US-Latin American Relations Heading South

The US Under-Secretaty of State for Latin American Affairs Arturo Valenzuela has set off a firestorm in Buenos Aires when making remarks critical of Argentina's legal protections for foreign investment. The remarks have so angered the Argentines that Foreign Minister Jorge Taiana sought out Secretary of State Hillary Clinton on the margins of the World Climate Conference in Copenhagen to lodge a protest.

What set off the fireworks were comments by the Under-Secretary in Buenos Aires as his initial trip to region since being confirmed was wrapping up Wednesday. Valenzuela relayed some criticism he had heard from the representatives of US companies doing business in Argentina about the local investment climate.

"I noticed a change: In 1996 there was much more enthusiasm and intentions to invest; today I heard concerns about legal insecurity and concerns about economic management; unless there are changes, the expected investments can't be carried out," he told local press on Wednesday. Valenzuela was also the Under-Secretary for Latin American Affairs during the Clinton Administration, the hey-day of the neo-liberal Washington Consensus when free markets economic policies were all too often rammed down Latin America's throats.

That comparison to 1996 and the criticism of legal protection regime for foreign investment (inseguridad jurídica) is what triggered a ferocious response not just from the Argentine government of Cristina Fernández de Kirchner but from various sectors within Argentina that has been front-page news for the last two days.

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