December 21, 2014
Francisco and François II
President Cristina Fernández de Kirchner returns today from a week in Europe which can claim overall success for limited objectives. Whatever the mishap with her left ankle (which restricted an already unambitious agenda), CFK put the right foot forward in both Rome and Paris. The length of her Monday lunch with Pope Francis was the main surprise since its cordiality could be safely assumed with a peaceful transition period in their common homeland so much to their mutual advantage — no need to explore any specific issues with both agreeing even over the hot potato of crime as having its root causes in exclusion. Even if Pope Francis will be meeting with the heads of state of both Britain and the United States in the near future, neither South Atlantic nor foreign debt issues were reportedly broached (and nor was drug-trafficking).
In Paris CFK was always going to count on the good offices of French President François Hollande because the socialist leader of a European Union country had little choice but to back a debt restructuring against hedge fund holdouts after Europe’s insolvency crises of the last few years, renewing his pledge to be amicus curiae for Argentina before the Supreme Court of the United States. Whether the initial Argentine offer to repay Paris Club debt offers enough money up front and whether the repayment will be reciprocated with European investment (with the possible exception of Total oil, the French private sector showed distinctly less enthusiasm than Hollande, even if the ankle problem helped to cloak the scant business contacts) are details which can await the start of negotiations on May 28 and beyond. Yet perhaps following the Repsol compensation, Argentina will need to look harder at pending arbitration liabilities with French firms if it is to secure broader-based Paris Club support than Hollande’s good offices.
But all in all, a modest but effortless success with yesterday’s cultural activities the cherry on the cake. The limited agenda was always going to be overshadowed by the Crimean crisis with Paris perhaps more interested in Argentina’s continued United Nations Security Council rejection of Russian designs on the peninsula than in CFK’s wish list (not that France or Europe really know where they stand because clear-cut repudiation of Moscow’s aggression is inhibited by Russia’s role as a massive investor in Western Europe, a vital gas supplier and even a major French armaments client). Little gained but nothing lost.