World Bulletin / News Desk
Argentina signed an agreement with China on Wednesday that will allow the Asian country to build a fourth nuclear power plant and two hydropower plants in the South American country – the latest Chinese advance in the region.
China will provide $2 billion in financing for supplying goods and services from suppliers in its country and elsewhere for the project, Argentine Economy Minister Axel Kicillof said in a statement from Beijing.
He said another 32 billion pesos ($3.8 billion) will go to financing the supply of Argentine goods and services for the project, adding that construction will take eight years.
Latin America’s third-largest economy needs financing to expand energy capacity after years of buoyant economic growth has led to supply shortages and distribution constraints.
Argentina’s state-run nuclear power company, Nucleoelectrica Argentina, will build and operate Atucha III, which will have 800 megawatts of installed capacity. It will be erected adjacent to the Atucha II nuclear power plant in Zarate, located 71 miles northwest of Buenos Aires.
Argentina already has two nuclear power plants in operation with a combined 1,000 megawatts of capacity, or about 4 percent of total installed capacity. A third nuclear power plant is under construction.
Another agreement with China is to build two hydropower plants in Patagonia, a southern, sparsely populated region.
China will help finance construction of the Nestor Kirchner and Jorge Cepernic dams with a combined 1,300 megawatts of capacity.
“We expect to begin the dams soon,” said Argentine Planning Minister Julio De Vido, who traveled with Kicillof.
Argentina is turning to China for funds after a decline in private investments that fueled an increase in energy and infrastructure capacity in the 1990s. An economic crisis in 2001-02, however, ushered in an increase in state intervention, including price controls, higher taxes and trade restrictions. High inflation and a recession have further deterred private spending and the suspension of projects.
Chinese companies have picked up some of the slack, with Beijing-based oil company Sinopec buying Occidental Petroleum’s Argentine assets in 2010. The CNOOC Group, another Beijing-based oil company, also has bought a stake in Bridas, the second-largest oil company in Argentina.
Argentina, a huge agriculture country with ample energy resources, and much of the rest of Latin America, offer the attraction of ample natural resources for China, which lacks productive land and water for expanding crop output to feed a growing populace, now at more than 1.35 billion compared with 40 million in Argentina. The financing deals also open opportunities for the sale of Chinese manufactured goods and services to new markets.Last Mod: 04 Eylül 2014, 10:00