BUENOS AIRES: Argentina's Foreign Minister Hector Timerman Thursday lashed out at the EU, calling its reaction to his country's nationalization of YPF, a subsidiary ofSpain's Repsol, "unacceptable."
Timerman was responding in an open letter to criticism by European Union Trade Commissioner Karel De Gucht.
"Your comments on Repsol-YPF have surprised me, both in their focus and the tone that was used. The reaction is excessive and the focus deserves a more detailed analysis," Timerman wrote.
"I find it unacceptable that you question the commercial policy of our country," Timerman wrote.
Spain's subsequent move to stop importing Argentine biodiesel "represents an unacceptable discrimination which, if it is not corrected by the EU, affects half of our exports toSpainor 10 percent of our total exports to the EU," Timerman said.
Argentinaannounced that it would seize 51 percent of YPF shares earlier this month, with some 26 percent to be held by the federal government and 25 percent going to the provinces.
Spainhas led a chorus of international outrage over the move, saying it harmed bilateral relations and would denyArgentinamuch-needed foreign investment and expertise in the oil sector.
In a letter made public on Monday, the EU's De Gucht said the expropriation "sends a very negative sign from the Argentine government to all international investors."
The move "adds to a growing list of problematic decisions adopted byArgentinain the recent past in the area of trade and investment," De Gucht said.
"The situation is now at a point where it risks jeopardizing our overall trade and investment relations," he wrote, according to the government Telam news agency.
Argentina's Senate earlier Thursday approved the government's move to nationalize YPF despite adamant US, EU and Spanish objections. The bill now goes to the Chamber of Deputies, which is expected to approve it on May 3.
YPF produces 34 percent ofArgentina's oil and 25 percent of its gas, and the company holds some 54 percent of the country's refining capacity, according to the private Argentine Petroleum Institute (IAP).
Buenos Aireshas accused Repsol of failing to invest in its oil sector, forcing a spike in costly imports.
After the Senate vote Repsol issued a statement defending its investment record inArgentina, countering the government's contention that the Spanish-owned company had failed to invest enough to maintain production levels.
But the takeover is popular inArgentina, where it is supported by both the government and the opposition.
Argentina's oil imports doubled to $9.3 billion in 2011 from the previous year and are set to top $12 billion this year, according to official figures.
Earlier this week the Standard & Poor's ratings agency downgraded its credit outlook forArgentinafrom stable to negative, largely due to the YPF takeover.
Argentinadeclared YPF a public utility on April 16. Later the same week it extended the move to YPF Gas, a separate company 85 percent owned by a division ofSpain's Repsol.
Comments
Comments are closed.