In my talks last month with Argentines in Buenos Aires and Cordoba I heard the same message – the government is incompetent and is holding back the potential of our rich country. As one entrepreneur said to me, “no educated successful person here goes into politics.” President Kirchner’s nationalization of Spanish private investment in Argentine energy interests is perfectly timed for my recent writing on Argentina.
Here is a country sitting on a huge amount of the same shale gas that is transforming North America, but who has now chosen to cutoff all access to foreign development capital. How can a US, European, or Asian energy company pour the billions of dollars of capital investment for drilling, pipelines, liquified natural gas terminals and ports into Argentina? President Kirchner may receive short term popularity, but she is acting against her country’s interest to divert public attention from Argentina’s economic underperformance.
Oh, wait, but I forgot it is Argentina – there is a pattern there. And speaking of the Malvinas/Falklands, I understand a prime issue for Argentina is energy exploration around the islands. Argentina wants the development rights. How would Argentina develop deepwater fields in the South Atlantic without foreign capital?
Going to war or nationalizing investor property is not going to unleash the power of the Argentine people and their amazing country.