Financial Hitmen Outflanked, Argentina Joins the BRICS

In the early morning hours of Aug. 24, Brazilian President Lula da Silva called his friend, Argentine President Alberto Fernandez, from Johannesburg to enthusiastically tell him that Argentina was one of six nations invited to become new members of the BRICS. To the beleaguered Argentine President, whose government has been subjected to relentless financial warfare, as well as threats and blackmail from the Biden Administration, this was completely unexpected. Two days earlier, several Argentine dailies had carried a story saying that the issue of Argentine membership wasn’t even on the summit’s agenda.

Then, at 8:00 a.m. local time, Fernandez addressed the nation to say that “We are going to be protagonists of a common destiny in a bloc that represents over 40% of the global population. We will continue to strengthen fruitful, autonomous and diverse relations with other nations of the world…as the BRICS are a new opportunity for Argentina.” A new opportunity indeed in the optimistic world order that is taking shape. Lula’s role in this has been indispensable. He has been a fierce advocate for Argentina since he took office Jan. 1, denouncing the IMF for “holding a knife” to the country’s neck with its “asphyxiating” conditionalities.

The IMF wielded that “knife” as Argentina tried to renegotiate the obscene $44 billion loan the Fund granted former neoliberal President Mauricio Macri in 2018. On Aug. 16, Finance Minister Sergio Massa, who is also the presidential candidate of the ruling Union for the Fatherland (UP) coalition, told reporters that the IMF demanded the peso be devalued by a drastic 20% (!) as a condition for approving the terms of the renegotiated loan. As soon as the Central Bank announced the devaluation and an interest rate hike to an astounding 118%, economic chaos ensued.

European Union officials, lined up with London and Wall Street, also warned Argentina in mid-July that it was “not the right time” to join the BRICS as this would send the “wrong signals” to Russia and China about the Ukraine War. On Aug. 17, despite having committed to attending the BRICS-Plus summit in Johannesburg, President Fernandez suddenly pulled out with no explanation.

President Lula was having none of this. Speaking from Johannesburg to fellow Brazilians Aug. 22 in his weekly press conference, he emphasized the importance of Argentina joining. Brazil, he said “cannot pursue a policy of industrial development” without its neighbor. Were Argentina a member of the BRICS, he insisted, it would be possible to help it, because the group would be able to “propose a more serene, mature and less pragmatic strategy,” rather than the one “proposed by the current rules-based order that only favors the financial system.” To follow up on the Johannesburg meeting, Lula met with Massa in Brasilia on Aug. 28 to discuss specific proposals for strengthening bilateral trade and facilitating credit lines to Argentina for infrastructure projects.