The New Commie South - More Argentine Hilarity

[Denny Crane!]

In further moves to distract the populace from institutional failings and to align with the strategies of other countries like Venezuela:

http://www.bbc.co.uk/news/world-europe-17739204

YPF Repsol: Spain warns Argentina of strong response

Demonstrators in Buenos Aires backed the nationalisation of YPF on Monday
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The Spanish government has warned it will defend its interests as a row with Argentina over the nationalisation of oil company YPF intensifies.

The majority stake in YPF is owned by Spanish oil firm Repsol, whose shares fell by 8% in early trading in Madrid.

Promising a "clear and overwhelming" response, Spain summoned the Argentine ambassador to express its concern.

The nationalisation has alarmed foreign investors but is said to be popular among ordinary Argentines.

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Nationalising YPF

Spain's Repsol has hitherto owned 57.4% of shares with 25.5% belonging to Argentina's Petersen, 0.02% to the Argentine government and 17% traded on stock exchanges
The Argentine government proposes to seize 51% of the shares, all of which will be taken from Repsol's stake, leaving the Spanish firm with 6.4%
The expropriated shares will in turn be divided between the Argentine government and provincial governors
Following the expropriation, Petersen will retain its 25.5% stake and 17% of the shares will continue to be traded
Repsol has vowed to demand compensation, saying it could seek international arbitration over its 57% stake in YPF.

"These acts will not remain unpunished," Repsol executive chairman Antonio Brufau told reporters.

The head of the European Commission, Jose Manuel Barroso, said he was "seriously disappointed" by Argentina's decision.

The EU expected "the Argentinian authorities to uphold international commitments and obligations", he said.

'Friendship' strained
Argentina's ambassador to Madrid, Carlo Antonio Bettini, was due to visit the foreign ministry at midday (10:00 GMT), the ministry told the BBC News website.


President Fernandez de Kirchner: "We are one of the only countries in Latin America and I would say in the world that doesn't have control over its natural resources"
Earlier, Spanish Foreign Minister Jose Manuel Garcia-Margallo said the "climate of friendship" between the two countries had been broken.

The Spanish Prime Minister, Mariano Rajoy, is travelling to Mexico and Colombia, where he is expected to seek support for Madrid's position.

His Industry Minister, Jose Manuel Soria, said Spain would take "all measures it considers appropriate" to defend the interests of Repsol and Spanish businesses abroad.

The nationalisation was announced to applause on Monday at a meeting between Argentine President Cristina Fernandez de Kirchner, her cabinet and provincial governors.

Reading out a statement at the meeting, an official said YPF had been "declared a public utility and subject to expropriation of 51% of its assets".

The government took over the management of YPF with immediate effect while the bill on expropriation was sent to the Argentine Congress.

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Analysis

Robert Plummer
Business reporter, BBC News
YPF is not the first big firm to be nationalised by President Cristina Fernandez and it is unlikely to be the last.

Ms Fernandez has continued the economic nationalism of her late husband and predecessor, Nestor Kirchner, bringing such companies as the national airline under renewed state control.

Like Aerolineas Argentinas, YPF was privatised in the 1990s by former President Carlos Menem, a man who transformed the Peronist party into an engine of free-market reform.

But since Argentina's economic collapse of 2001-02, Peronism has gone back to its original corporatist vision, and many sectors of the economy that were liberalised in that era are now back in government hands.

Supporters of the nationalisation celebrated in Buenos Aires, waving placards that read "YPF - we're going for everything".

Graffiti appeared on a city centre wall that read "Repsol, get out of YPF".

Mrs Fernandez de Kirchner stunned investors in 2008 when she nationalised private pension funds and she has also renationalised the country's flagship airline, Aerolineas Argentinas.

Many Argentines blame free-market policies such as the privatisations of the 1990s for the economic crisis which resulted in a debt default in 2001-02.

Argentina wants to reduce its expensive energy imports from elsewhere, the BBC's Tom Burridge reports from Madrid.

Before rumours surfaced several weeks ago that Argentina might take YPF from Repsol, Spain and Argentina generally enjoyed good political ties, and important economic ones.

Spain does a significant amount of trade in the country, so there is likely to be an economic fallout to this dispute too, our correspondent says.

But President Fernandez de Kirchner has dismissed the threat of reprisals.

"This president isn't going to respond to any threats... because I represent the Argentine people," she said.

"I'm the head of state, not a thug."

'Mistaken policy'
According to AFP news agency, Repsol will seek compensation of at least $10bn (£6.3bn; 7.7bn euros).

YPF accounts for just over a quarter of Repsol's operating profit, 21% of its net profit and 33.7% of its investments, Mr Brufau said.

Repsol's executive chairman accused President Fernandez de Kirchner of resorting to nationalisation "as a way of hiding the economic and social crisis which Argentina is suffering".

Argentina's crisis, he argued, was rooted in "a mistaken energy policy".

He accused Argentina of running a campaign of "harassment" in recent weeks in order to push down the price of YPF shares and get a bargain price for the expropriation.

"It is not appropriate for a modern country, Argentina does not deserve this," he said.

Repsol's Argentine partner, the Eskenazi family's Grupo Petersen, has a 25.5% stake in YPF which will not be affected by the nationalisation.

However, Reuters notes that it is unclear how Petersen will be able to repay a $1.9bn loan provided by Repsol.

Spain will be royally peed off to put it lightly.

As a Brit I have to wonder what the implications are for the Falklands dispute, it certainly means more support from surrounding countries for Argentina but they have shot themselves in the foot for support in Europe particularly any kind of sympathy Spain might have had.

[Phier]

Soon, with such bold action, they too can become a paradise like Venezuela!

[justicar5]

As a Brit I have to wonder what the implications are for the Falklands dispute, it certainly means more support from surrounding countries for Argentina but they have shot themselves in the foot for support in Europe particularly any kind of sympathy Spain might have had.

Wrong on that one, Chile for one is going up in flames, in fact the only nation that likes it is Venezuela. (At least according to the Radio 4 news reports).

I do however think that natural resources should be nationalised, but this a a retarded way of going about it. (A better way to do it is to set up a state owned company with 30-40% of shares available to oil companies who want to exploit the resources.)

[Derpy Hooves]

Ooh yet another interesting thing in the Mudpit. I shall be paying attention to how this thread goes. I predict more talk of the Falklands in this thread.

[jamson]

South America has been left wing for a long time now, with left wing European support and even as far as US and Chinese opinions THE UK will give the islanders constant refurendums or just hand over control.

[Claudius Gothicus]

The issue is too large to explain it clearly on the Mudpit right now, but to put it bluntly it's both a neccessary and stupid and populist and legitimate and irrational and rational move.

Kinda contradictory but the idea of recovering the production of oil and fuel isn't far fetched, especially considering REPSOL hadn't made a clear investment since at least the mid 00's. This non-investment policy wasn't only REPSOL's fault and the ''fix prices'' policy of the Gov. certainly didn't help along with Crony-Capitalism.

On the other hand, when the Company worked as a Mixed Ownership(State and Private capitals) in the mid to late 90's it was very profficient. But, and here is the tricky part, the company went from ''mixed status'' to almost fully private when a Constitutional Change made in '94 came into effect 4 years later, that change granted Provinces the regalias derived from oil and so a large anti-YPF pro-''full privatization'' Lobby was setted by the Governments on the Oil Provinces, among which was Cristina Fernandez's province: Santa Cruz. With all the lobby the final push finally helped REPSOL buy the company in '99.

So, basically the company was doing OK and then a big lobby was set up by provincial goverments to privatize and tax the YPF company, said lobby worked through a Constitutional Grant and a degree of internal corruption, favors-trade etc. The funny and sad and certainly unerving part is that the ones who are now playing the ''Patriotic card'' where the ones who privatized the ''Mixed Company'' back in the day.

I'll try to respond the questions regarding this issue as neutrally as I can but I don't expect a great deal of reflexive thought though on many, this is the Mudpit after all.

[Plan C]

The issue is too large to explain it clearly on the Mudpit right now, but to put it bluntly it's both a neccessary and stupid and populist and legitimate and irrational and rational move.

Kinda contradictory but the idea of recovering the production of oil and fuel isn't far fetched, especially considering REPSOL hadn't made a clear investment since at least the mid 00's. This non-investment policy wasn't only REPSOL's fault and the ''fix prices'' policy of the Gov. certainly didn't help along with Crony-Capitalism.

On the other hand, when the Company worked as a Mixed Ownership(State and Private capitals) in the mid to late 90's it was very profficient. But, and here is the tricky part, the company went from ''mixed status'' to almost fully private when a Constitutional Change made in '94 came into effect 4 years later, that change granted Provinces the regalias derived from oil and so a large anti-YPF pro-''full privatization'' Lobby was setted by the Governments on the Oil Provinces, among which was Cristina Fernandez's province: Santa Cruz. With all the lobby the final push finally helped REPSOL buy the company in '99.

So, basically the company was doing OK and then a big lobby was set up by provincial goverments to privatize and tax the YPF company, said lobby worked through a Constitutional Grant and a degree of internal corruption, favors-trade etc. The funny and sad and certainly unerving part is that the ones who are now playing the ''Patriotic card'' where the ones who privatized the ''Mixed Company'' back in the day.

I'll try to respond the questions regarding this issue as neutrally as I can but I don't expect a great deal of reflexive thought though on many, this is the Mudpit after all.

Why does Kirchner flat out refuse compensation for Repsol? If Vaca Muerta fields are so vital to Argentine energy security, usual route would be to buy YPF out, that's how most business is done, right? Otherwise it reeks of state-sanctioned theft, surely.

[Claudius Gothicus]

Why does Kirchner flat out refuse compensation for Repsol? If Vaca Muerta fields are so vital to Argentine energy security, usual route would be to buy YPF out, that's how most business is done, right? Otherwise it reeks of state-sanctioned theft, surely.

Because that would mean having to buy the company under a negotiated price, which would be far higher than the one the Government is predisposed to pay(we are not doing that great on funds any more, with the capital flight and the losses in the Balance of Trade).

And doing that would also mean losing all the ''populist'' shock of the whole measure. Come on, we are a Latin American country, do you believe we are intellectually beyond cheap demagoguery with nice flags and loud words?

[Choki]

The issue is too large to explain it clearly on the Mudpit right now, but to put it bluntly it's both a neccessary and stupid and populist and legitimate and irrational and rational move.

Kinda contradictory but the idea of recovering the production of oil and fuel isn't far fetched, especially considering REPSOL hadn't made a clear investment since at least the mid 00's. This non-investment policy wasn't only REPSOL's fault and the ''fix prices'' policy of the Gov. certainly didn't help along with Crony-Capitalism.

On the other hand, when the Company worked as a Mixed Ownership(State and Private capitals) in the mid to late 90's it was very profficient. But, and here is the tricky part, the company went from ''mixed status'' to almost fully private when a Constitutional Change made in '94 came into effect 4 years later, that change granted Provinces the regalias derived from oil and so a large anti-YPF pro-''full privatization'' Lobby was setted by the Governments on the Oil Provinces, among which was Cristina Fernandez's province: Santa Cruz. With all the lobby the final push finally helped REPSOL buy the company in '99.

So, basically the company was doing OK and then a big lobby was set up by provincial goverments to privatize and tax the YPF company, said lobby worked through a Constitutional Grant and a degree of internal corruption, favors-trade etc. The funny and sad and certainly unerving part is that the ones who are now playing the ''Patriotic card'' where the ones who privatized the ''Mixed Company'' back in the day.

I'll try to respond the questions regarding this issue as neutrally as I can but I don't expect a great deal of reflexive thought though on many, this is the Mudpit after all.

but argies skipped many legal steps. They are following the steps of Venezuela
And now we dont have imported products? Our industry is in the medieval age.
And with the issue of YPF we lose all claims to the Malvinas at the UN by the childish behavior of our President.

BBC:President Fernandez de Kirchner's policies have won support among ordinary Argentines

Yes only the ordinary argies support this government
this guys are typical communist and inmigrants who never workedl, paid by the government to get support from them
I hope I never find that I have a terminal disease, that would be the excuse for me to go out like a sniper to kill corrupts
joke


We are the new Cuba

[♖The Balkan Sobranie♖]

South America is the disgusting abode of communism and other misinformed, absurd and hypocritical political ideologies. Home to Che Guevara, Fidel Castro and other diego pinkos.

[Condottiere 40K]

While on one hand the full privatization of the company reeks of corrupt crony capitalism, but alarming the very investors that you need to pull your country out of it's economic death spiral does seem a self inflicted wound.

[Thorn777]

In further moves to distract the populace from institutional failings and to align with the strategies of other countries like Venezuela:



Spain will be royally peed off to put it lightly.

As a Brit I have to wonder what the implications are for the Falklands dispute, it certainly means more support from surrounding countries for Argentina but they have shot themselves in the foot for support in Europe particularly any kind of sympathy Spain might have had.

Link to your article?

[Babur]

isn't Hugo Chavez dying though? I don't see the point of Argentina wanting to emulate Venezuela.

[Claudius Gothicus]

isn't Hugo Chavez dying though? I don't see the point of Argentina wanting to emulate Venezuela.

''Nationalistic dickwaving'' of ''leftist tendencies'' do not know ''names'': they are intellectual movements, taking a hold on society or government and pushing for policies from there.

[Big War Bird]

Take take take

[justicar5]

Take take take

yes Repsol where.

Why does Kirchner flat out refuse compensation for Repsol? If Vaca Muerta fields are so vital to Argentine energy security, usual route would be to buy YPF out, that's how most business is done, right? Otherwise it reeks of state-sanctioned theft, surely.

but yes, it should be a buy out, not a seizure.

[Facupay]

Argentina should start caring about PR. It doesn't matter if this nationalization is legitimate or not, it makes Argentina, a country already famous for it's economic and politic inestability, look like in the eyes of foreign investors and other countries, in this case Spain and maybe the EU.

Their almost autistic foreign policy is hurting them alot. I mean, here in Uruguay the commerce chamber is still completely furious with Argentina because they banned many Uruguayan products in an arbitrary and surprising manner, despite being bound by the Mercosur. It's like they don't even pretend they care about the rest of the world anymore.

[Claudius Gothicus]

Their almost autistic foreign policy is hurting them alot. I mean, here in Uruguay the commerce chamber is still completely furious with Argentina because they banned many Uruguayan products in an arbitrary and surprising manner, despite being bound by the Mercosur. It's like they don't even pretend they care about the rest of the world anymore.

Well yeah the trade policies of Argentina border those of other super-protectionist countries... it's stupid taking into account many capital goods have to be imported to feed the local industry.

And in regards to the REPSOL-YPF problem, yes the general policy was nothing more than absolutely self-inflicted damage to PR and possible investments. The logical route would have been creating a whole new company and systematically redirecting funds and investments to that new company to then buy from the spaniards.

[Facupay]

Well yeah the trade policies of Argentina border those of other super-protectionist countries... it's stupid taking into account many capital goods have to be imported to feed the local industry.

And in regards to the REPSOL-YPF problem, yes the general policy was nothing more than absolutely self-inflicted damage to PR and possible investments. The logical route would have been creating a whole new company and systematically redirecting funds and investments to that new company to then buy from the spaniards.

Absolutely, it's important for a country to be able to administer it's own strategic resources but they should have handled things in a better way.

Lo peor son los monitos que aplauden y que dicen que es espectacular porque es la venganza del pueblo contra los gallegos explotadores y monárquicos .

As a Brit I have to wonder what the implications are for the Falklands dispute, it certainly means more support from surrounding countries for Argentina but they have shot themselves in the foot for support in Europe particularly any kind of sympathy Spain might have had.

Why? no surrounding country hates Spain or anything. It's purely a problem between Argentina and Spain.

[Admiral Piett]

When are these Latino countries going to recognize that this nonsense is only fueling their poverty? It's really stupid that two of them are walking backwards 20 years after some time of progress. Brazil and Columbia at least have the general idea of what's going on and are becoming quite strong due to more pragmatic policy.