Ships are moored at a port on the Parana River in Santa Fe, Argentina, December 21, 2020. REUTERS\/Stringer<\/p>\n
US\u00a0House\u00a0Foreign Affairs Committee Chair Warns of China Role in Argentina Contract Bid<\/p>\n
BUENOS AIRES, May 21 (Reuters)\u00a0\u2013\u00a0U.S.\u00a0House\u00a0Foreign Affairs Committee Chairman Rep. Brian Mast has warned\u00a0U.S. Secretary of State Marco Rubio of \u201cChinese malign influence\u201d in a bid for a major contract in<\/p>\n
, according to a letter seen by Reuters.<\/p>\n
The April 23 letter concerns an auction for a 25-year contract to dredge and operate Argentina\u2019s Parana River, a vital waterway for most of the country\u2019s agricultural exports, that Argentina estimates will reach $10 billion in investment.<\/p>\n
The terms of the tender, which is in its final phase with a decision expected in the coming days, explicitly barred state-owned companies,\u00a0preventing bids from Chinese firms.<\/p>\n
But Mast alleged that China was attempting \u201cto circumvent that choice through a private sector proxy.\u201d There is \u201cserious concern\u201d that Jan De Nul, a Belgian dredging company vying for the contract, \u201cmaintains deep and ongoing links to PRC state-owned entities\u201d through Servimagnus, an Argentine firm that\u2019s part of Jan De Nul\u2019s consortium, the letter claimed.<\/p>\n
Jan De Nul has managed the Parana waterway for decades and is competing for the contract against the Deme Group, whose consortium includes investment firm KKR & Co\u00a0and\u00a0U.S.-based Great Lakes Dredge & Dock Corp. In the bid\u2019s point-score system, Jan De Nul has been ahead.<\/p>\n
Argentina River Auction Draws Fire From U.S. Dredger Over \u2018Cooked\u2019 Tender<\/p>\n
The Trump administration, a close ally of Argentina\u2019s President Javier Milei, has expressed concern about\u00a0Chinese influence in Latin America, including Argentina, where Beijing in March was its second-largest trading partner.<\/p>\n
Awarding the contract to Jan De Nul \u201cwould be unacceptable and damaging to Argentina\u2019s national security, America\u2019s national security and our bilateral relationship,\u201d the letter said.<\/p>\n
China\u2019s foreign ministry did not immediately respond to requests for comment.<\/p>\n
In response to Reuters\u2019 questions, Jan De Nul and Servimagnus called the claims of ties between the companies and Chinese capital during the bidding process \u201cabsolutely false and malicious,\u201d and said that \u201cthere is no participation by Chinese companies, either as partners or as suppliers.\u201d<\/p>\n
Last Tuesday, Argentina\u2019s National Ports and Navigation Agency celebrated the culmination of the bid, calling it a process that had seen \u201cstrong multisectorial support.\u201d\u00a0In a statement, the agency said that the company and Deme have had partnerships with Chinese companies but \u201cthis is not grounds for disqualification.\u201d<\/p>\n
About 80% of Argentina\u2019s agricultural and agro-industrial exports leave the country via the Parana River, flowing from the Rosario agro-industrial hub and surrounding areas to the South Atlantic Ocean.<\/p>\n
Deme\u2019s consortium was approved by the\u00a0U.S. Department of Commerce\u2019s Advocacy Center, which helps companies pursuing foreign contracts, according to a person in contact with the consortium who requested anonymity.<\/p>\n
The lobbying effort resulted in Milei adviser Santiago Caputo flying last week to D.C. to meet with officials, including Mast, Michael Jensen, senior director for Western Hemisphere affairs on the National Security Council, and Alec Oxenford, Argentina\u2019s ambassador to the\u00a0U.S.<\/p>\n
Caputo was told that the\u00a0U.S. had \u201cgrave concerns\u201d about Chinese involvement in the bid, according to a person familiar with the visit. The person said the concerns stemmed partly from allegations of frequent contact between the Chinese embassy and Servimagnus\u2019 office in Argentina.<\/p>\n
The consortium, in a May 11 letter addressed to Jensen seen by Reuters, has also alleged \u201cclear bias\u201d against\u00a0U.S.-backed investment, saying that the timeline for companies to present a technical offer was rushed and had benefited Jan De Nul.<\/p>\n
Argentina\u2019s anti-corruption prosecutors\u2019 office has also signaled concern about \u201cserious and obvious\u201d procedural irregularities in the bidding process.<\/p>\n