By Diego López Beltrán | 2023-08-02

BUENOS AIRES -– In a move that has raised eyebrows, Argentina has halted the construction of an American radar in Tierra del Fuego, while simultaneously signing a memorandum of understanding with a Chinese company to move forward with a multipurpose port project in the province.

The Argentine government's undersecretary of communications suspended in mid-June a permit granted last November to the US aerospace company LeoLabs to build an Earth orbit mapping station near the town of Tolhuin.

The reversal reportedly stemmed from concerns that the company has British investors, according to the official media Página/12 and the La Política Online (LPO) portal.

LeoLabs provides satellite monitoring services for aerospace companies, helping them avoid collisions by tracking space debris and identifying trajectories of objects in Earth's orbit.

The US ambassador to Argentina, Mark Stanley, in March applauded on Twitter the decision by LeoLabs to install the first orbit mapping station in South America, expressing hope that the company could "collaborate" with other entities to "protect against space debris."

However, the Argentine government reversed itself in June after concerns were raised that the information collected by the radar could be used for military purposes.

Construction work was already 50% complete when Buenos Aires halted it.

2 deterrents

Two key factors allegedly influenced the Argentine suspension.

First, according to a report by the General Inspectorate of Justice of Tierra del Fuego, LeoLabs has British investors.

Argentina is still at odds with the United Kingdom 41 years after their war over the Falkland Islands.

Second, the radar station would have been situated just 500km from those islands, still held by the British.

Yet while Buenos Aires suspended the installation of the US radar, the provincial government of Tierra del Fuego moved forward with another project of geopolitical importance.

On June 5, the provincial government asked its legislature to ratify an agreement signed on May 31 with the Chinese company Shaanxi Chemical Industry Group to construct a multipurpose petrochemical complex. The complex would include a port terminal in the town of Río Grande.

The agreement with the Chinese company provides for an estimated investment of $1.25 billion. The multipurpose petrochemical complex would produce 600,000 tons of synthetic ammonia, 900,000 tons of urea, and 100,000 tons of glyphosate, Bloomberg Línea reported.

In addition to the complex, the agreement also includes plans to construct a port for vessels of up to 20,000 tons and a 100-megawatt power plant.

The provincial legislature has not yet acted.

Chinese control of strategic infrastructure

The governor of Tierra del Fuego, Gustavo Melella, stated in an interview with Bloomberg Línea that the agreement with the Chinese company is only a "letter of understanding."

This means that the agreement is not yet finalized and requires national permits and the approval of the Argentine Foreign Ministry before it can be implemented.

In a report to Congress in May, the Ministry of Transport denied knowledge of a formal initiative to build a port terminal in Tierra del Fuego. The report stated that the ministry had not received any applications seeking approval of such a project.

Opposition MP Federico Frigerio questioned the initiative, stating that it "promotes the control of a Chinese state company over our strategic infrastructure."

Since the "the port is of a strategic nature", the investors should all be Argentine, whether they be local, private or public in nature, he tweeted on June 8.

However, it is unlikely that China will build a port in Tierra del Fuego, Agustín Rossi, President Alberto Fernández's chief of staff, told Congress in mid-June.

"The only port that is currently authorized to be built in the province is a multipurpose port by the Argentine company Mirgor," he said. The potential port is situated on the same land that the Chinese had planned to use.

Construction by Mirgor and its partner Newsan, both Argentine firms that assemble household appliances, is already under way.

If the Chinese decided to build a port in Tierra del Fuego, they would have to find another spot.

The $380 million Mirgor-Newsan port project has received approval for environmental studies and is expected to be operational within three years, according to Bloomberg Línea.