Andy Silvester is the Campaign Manager at the TaxPayers’ Alliance.
This weekend, somewhere in between the state dinners, photo opportunities and awkward handshakes in which absolutely nobody mentions Ukraine, G20 leaders will come together to – in theory – discuss the priorities for the developed world over the coming months and years.
Around that large and no doubt well-appointed table will be representatives of Cristina Kirchner, Argentina’s President. The rap sheet against Kirchner is lengthy, but for those who, understandably, have decided not to follow the intricacies of Argentinian domestic politics, it’s worth repeating. To cut a tremendously long story short, the Argentine Government is refusing to meet its international obligations on debt repayment, IMF rules, economic statistics and respect for court judgements.
Earlier this year, Argentina defaulted on its international loans for the second time in 13 years. The USA and other creditors have won more than 100 court judgements against the Argentine government and, despite Kirchner’s commitment to respect US law when issuing the bonds, the government has ignored the rulings.
It accounts for nearly 50 per cent of cases at the International Centre for Settlement of Investment Disputes, is the only G-20 nation that refuses to submit to “mandatory” International Monetary Fund surveys, and is the first country to be censured by the IMF for essentially fiddling the figures on inflation and employment. It’s got so bad that The Economist refuses to print the country’s official statistics, “tired of being an unwilling party to what appears to be a deliberate attempt to deceive voters and swindle investors.”
With that rap sheet, it’s no surprise that polling conducted by the TaxPayers’ Alliance released today demonstrates just how unhappy European taxpayers are with the Argentine government. Some 69 per cent of them believe that Argentina should be booted out of the G-20 until Argentina completely and fairly settles its debts, and 87 per cent support a “rule book” for G-20 membership that would require member countries to manage their finances responsibly, pay the debts they owe, and uphold the rule of law in order to qualify for membership.
And, strikingly, they also support the UK’s decision to withhold World Bank funding from Argentina until the debt situation is revolved and its behaviour on the world stage improves. Driven by pressure from our Stop Funding Argentina campaign and the basic logic that the UK shouldn’t be funding a country that refuses to recognise the sovereignty of the Falklands, the UK Government allied with others to vote down loans to the pariah country. A number of MPs, not least Andrew Rosindell, are calling on the Government to continue economic pressure.
Since then, Argentina’s financial behaviour has been as deplorable as ever and its foreign policy ever more belligerent – as Kirchner attempts to distract people from the slow-motion car crash of her state-driven economic policy, as evident in the purchase of 24 advanced Saab Gripen fighter aircraft at the cost of $1.6 billion. In December, the World Bank’s members will vote on whether to restart the loans. Despite the lack of progress in bringing Argentina back into the world’s capital markets as a respected member of the world economy, the Bank’s board has endorsed a new country strategy for Argentina including some $3 billion in new loans.
The UK Government must now, as before, mount a significant diplomatic operation to ensure that Argentina settles its old debts before it receives any new ones. This is, after all, British taxpayers’ money at risk. As our polling shows, there remains plenty of support in an international community tired of Argentine intransigence. To her credit, Justine Greening has stated her opposition to re-starting the loan program in the Commons. At a time when the Prime Minister is looking for friends on the Continent, leading a Europe-wide campaign to ensure we don’t prop up a trouble-making regime with taxpayer cash would be a good start.