Screenshot from vincentin website
The government of the indebted country wants to prevent the sale of national resources, an international banking consortium wants to transfer the insolvency process to the usa
On 9. June, the argentine government announced the expropriation of the vicentin agribusiness group. The "markets" saw a general attack on private property – in the middle of corona times and in the middle of the national bankruptcy. The shares of argentine companies listed on wall street plummeted, and the country’s risk skyrocketed.
The casa rosada refused: no, no one had the intention to expropriate on a large scale, vicentin was a special case. According to president alberto fernandez, the intention is to save the company – which is wholly owned by the national government – in order to prevent it from being "into the hands of foreign capital" . This is a "strategic decision". He is concerned about the "food safety".
This slogan comes from the unpopular ocologists, since the left-wing reformists of the rio de la plata have so far kept the gene soy "for a gift of god" (pepe mujica) and the demand for pesticide-free agriculture for silly. New times dawn in the pampas?
The vicentin ie is now also occupying international courts and the world bank. It’s not just about a few subsidies for a bankrupt corporation – as happens every day in the northern hemisphere. The government in buenos aires is rebelling against the sellout of its national wealth. And it’s about criminal money laundering and fraud. At the center of the allegations is the world’s roughest commodities trader: glencore, based in switzerland.
Vicentin, founded in 1929, is one of the biggest players in the south american agribusiness, with its own port. Its shares are owned by the family. The peronist governments of nestor and cristina kirchner dreamed of a "national bourgeoisie" and granted loans almost without limits. Mauricio macri’s (neoliberal) government has also shown itself to be rude, as chemical agriculture plays billions in.
By the end of last year, debt had reached a level that made bankruptcy inevitable. The country was insolvent and could no longer get fresh money. That was the end for vicentin – because its competitors, the u.S. Groups cargill, adm and bunge, louis dreyfus (netherlands) and the chinese cofco receive financing on the international capital market at an interest rate of less than one percent.
At the last minute, on 2. December 2019, one week before president fernandez was to take office, "" vicentin salvaged what could be salvaged and divested its stake in renova – an agribusiness that produces biodiesel. Until then, it was owned half by vicentin and half by glencore. On 2. December, the swiss acquired 16.67 percent of renova’s shares, giving them a two-thirds stake in the company. One day later, vicentin founded the brokerage firm nacadie argentina, which handles more or less dubious financial transactions in paraguay, uruguay and panama. The exact purchase price is not known, and it is unclear into which account glencore paid. Glencore’s spokesman refused to comment to telepolis. On 4. December, vicentin declared its inability to pay. Then came the court vacations and in february the judiciary opened the bankruptcy proceedings. Rough believer in the billion-dollar debt is the state-owned banco de la nacion.
In principle, argentine bankruptcy law recognizes two possibilities: either the pledged assets fall to the creditors, or a supervised insolvency is chosen. In this case, the bankrupt company can continue to operate until a solution is found. The argentine government feared that the creditors – in this case the state-owned banco nacion – would be bypassed or compensated with a few worthless pieces of foreign debt and the fillet pieces of the group would be given to foreign financiers. Glencore’s offer for the remaining shares in renova was already on the table. Then the agribusiness would be completely in foreign hands.
The expropriation is also controversial in argentina. The governors of the soybean provinces are under prere and are keeping their distance. The former peronist minister guillermo moreno said that interfering with an ongoing judicial process was illegal and disregarded the separation of powers. Promptly he was called from his own ranks as a "traitor" insults. Former economy minister roberto lavagna, whose party is also in the government, also voiced doubts. Instead of expropriating, he said, they should be paid off with a "golden share" a veto right in strategic decisions, and a right to a share in the company’s profits.
New quality of international money collection
Vicentin’s shareholders turned first to the argentine judiciary and then to the public in an open letter, saying that the decree was "surprisingly" and the expropriation "unjust, arbitrary and illegal". They did not respond to the accusations of money laundering and fraud in the sale of renova.
Yesterday they were pleased with a new turn of events: the foreign creditors have turned to a court in new york and asked for a discovery process to be opened "discovery process" . For the time being, it is a matter of gathering information, possibly the banking consortium – including the world bank – wants to continue the insolvency proceedings in the usa.
This would be a new quality of international money collection. In the future, it will no longer be the registered office of a group that is decisive for the place of jurisdiction, but the registered office of a creditor. Of course, this does not apply to "side ies" such as human rights. In january 2014, the u.S. Supreme court had barred a san francisco court from hearing the case of the store steward murdered at mercedes-benz argentina. "The general state of the u.S. Slowdown could discourage foreign investors" – hewed it in the judgment.
The government is up against the wall with its back against the wall. She has provided her followers with an argumentation aid and in it she refers to the german bailouts. It is still arguing with the judiciary about the status, but its forced administrator has already started work. The expropriated company will be "mixed company" as a mixed company, according to the "ypf model" – announced matias kulfas, minister of productive development.
The "ypf model does not bode well
The erdol company ypf had been privatized in the 1990s by the peronist carlos menem, and the party had celebrated it, including the then governor of the (erdol) province of santa cruz, nestor kirchner and his wife (the congresswoman) cristina. Then she became head of state and expropriated repsol as an act of "national sovereignty". However, the new ypf did not become a state-owned company, but a mixed company, with the operational part in the hands of the private owners, including the u.S. Asset managers. Ypf is listed on wall street and is subject to us jurisdiction.
Cristina appointed as its ceo miguel galuccio, an executive from schlumberger, the world’s largest oil exploration company. And he relied on fracking. While shell recently stopped fracking because of the triggered earthquakes, ypf continues to rely on this technology. The "instituto patria", a think tank of vice president cristina kirchner, has already sent out head hunters, "to look for a galuccio for the agro sector" to look for.
The argentine left sees the expropriation with mixed feelings. Miryam gorban, chair of the department of food safety, sees the decree as a "small step in the right direction". A "publicly owned company" can manage the agricultural sector sustainably and without pesticides. Juan pereyra, an environmental lawyer, also sees positive signs. The country can no longer afford chemical agriculture. Not only does it produce toxic food, but it is becoming more and more expensive every year.
But in the "argumentation aid" the government does not mention terms such as ecology and sustainability. The new vicentin will not "company in public hands". It is to be managed by ypf-agro. And ypf-agro is the largest producer of glyphosate in argentina.