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Don Chatarrín discovers the free market: Is Milei giving China the "invisible hand"? Southern Energy (SESA), a consortium formed in 2025 by PAE (30%), YPF (25%), Pampa Energía (20%), Harbour Energy (15%), and Golar LNG (10%), conducted the international tender for the supply of pipes that sparked the controversy. The consortium projects an investment exceeding US$15 billion. In the vote on reviewing the tender to allow Techint to access the supply, PAE appears to have been the most vehement opponent, indicating another rift at the highest levels of corporate power. The supply of the pipes that sparked the dispute is just one component of a more ambitious project that includes the construction of the infrastructure to transport gas from Vaca Muerta to the Gulf of San Matías. Through this route, the Neuquén shale gas will end up in the Hilli Episeyo and MK II liquefaction vessels, which will be located at sea, about six kilometers from the mainland. PAE, whose public face is one of the country's wealthiest families, the Bulgheronis, is actually primarily partnered with British Petroleum and the Chinese company CNOOC. Harbour Energy is also a British-based oil and gas company. Golar LNG, meanwhile, is headquartered in Bermuda and specializes in floating LNG storage and offloading (FFO) infrastructure. The construction of the gas pipeline is also subject to an international bidding process, which Southern Energy will resolve between March and April. Ten companies are competing for the contract. Paolo Rocca is also competing in this tender with Techint Engineering and Construction in a Temporary Business Association (UTE) along with SACDE, owned by brothers Damián and Marcelo Mindlin, which has a voting stake in Southern Energy. These are the same companies that built the Néstor Kirchner gas pipeline (renamed Perito Moreno) and, more recently, the Vaca Muerta Oil Sur (VMOS) pipeline. The VMOS pipeline was indeed supplied with pipes from Tenaris, Techint's subsidiary, which outbid the Indian company Welspun. Not only that, but Techint also built the VMOS pipeline despite submitting a more expensive bid than Pumpco, an American company we'll discuss shortly. The fact is, Techint won that bid thanks to the influence of Horacio Marín, the current president of YPF and a former employee of Paolo Rocca for thirty years: prior to joining YPF, he managed Tecpetrol, Techint's oil company. In the tangled web of events unfolding between Techint and the Milei administration, one key detail stands out: at the beginning of his term, the president appointed Marin, also known as Paolo Rocca, as president of YPF. Not only that, but Techint also appointed Julio Cordero, an anti-worker zealot who had previously served as the group's legal counsel for labor matters, as Secretary of Labor. When did the relationship break down? It's a question that can't be answered with certainty, but in the corridors of power, it's said that Paolo hasn't been getting his calls answered at the Casa Rosada for quite some time. In the bidding process for the construction of the new gas pipeline to the San Matías Gulf, Techint will face competition from other major players. The most prominent is the consortium comprised of local firm Contreras Hermanos, the aforementioned Pumpco (United States), and Bonatti (Italy). Pumpco is a construction company belonging to MasTec, owned by brothers Jorge and José Mas, who also own Inter Miami, the soccer team where Lionel Messi plays. This company appears to boast of Donald Trump's backing. Bonatti, for its part, has experience in energy infrastructure projects and desalination plants in Chile. The Mas brothers are the sons of the late Cuban businessman Jorge Mas Canosa, a prominent member of the Florida gas industry, who initially did business with José Luis Manzano. The Mas brothers were left disappointed when Techint and SACDE beat them to the contract to build other pipelines in Argentina. Now, they're seeking revenge. But there are other contenders vying for the gas pipeline construction: the consortium formed by Víctor Contreras and Sichim (Italy); BTU, a local construction company controlled by the Mundin family; OPS, a Neuquén-based company owned by Carlos “Charly” Pérez; Pecom, part of the Pérez Companc group; Bueno Engenharia, a Brazilian company; and IEB Construcciones, which recently acquired the construction company Dycasa. Another significant business opportunity is opening up through the consortium formed by YPF and the Italian company ENI, which also includes the UAE-based XRG and a fourth company originating in Saudi Arabia. This consortium is seeking financing from JP Morgan and plans investments of US$17 billion, encompassing tenders for the supply of pipes and the construction of a gas pipeline, an oil pipeline, and a multi-product pipeline. This business conglomerate operating in Vaca Muerta, both in the extraction of hydrocarbons and in the construction of infrastructure works that will allow the expansion of the capacity to export gas and oil, demonstrates a capitalist war taking place between foreign powers and a local bourgeoisie seeking to position itself to obtain its share in the plunder of our country's common natural resources. Techint and prebendary capitalism The Rocca family's record includes Agostino's involvement, the founder of the business empire, in Benito Mussolini's government and his establishment in Argentina with financing through national government funds. During the civic-military dictatorship that emerged from the 1976 coup, state repression and the disappearance of workers in the "Night of the Pipes" were carried out with the complicity of the steel company's owners. Towards the end of the dictatorship, the Rocca family's company (like the Bulgheroni family of PAE, who vetoed Techint's pipes for the controversial gas pipeline) benefited from the nationalization of private debt carried out by Domingo Cavallo. The recycling of that public debt to this day constitutes a burden on the shoulders of the working people, who suffer the austerity measures in all aspects of life—a sacrifice in favor of imperialist financial capital. In recent history, the Techint Group showed a very important expansion in Vaca Muerta due to the benefits received by Tecpetrol, the hydrocarbon arm of the business conglomerate, thanks to the efforts of the Government of Mauricio Macri. During the Macri administration, the Rocca family was also among the top one hundred businesspeople who moved the most dollars out of the country, according to an exposé by journalist Horacio Verbitsky. The family that owns Techint also appears on the Panama Papers list and in other reports detailing the placement of funds in tax havens through opaque mechanisms. Another detail reveals that the holding company prefers to keep its assets abroad: its official headquarters were established in Luxembourg. In 2020, at the beginning of the Covid pandemic, former president Alberto Fernández called the business owners who were laying off workers "miserable." The Techint Group was among them: it had announced the dismissal of 1,400 employees. Two years later, the company won the bid for the pipes that would make up the Néstor Kirchner gas pipeline amid cross accusations between Kirchnerism and the then Minister of Productive Development, Matías Kulfas, about the responsibility for a bid that had all the indications of having been directed in favor of the miserable Techint. Kulfas suggested off the record that the state-owned company Energía Argentina (IEASA), in charge of the gas pipeline construction and headed by a subordinate of Cristina Kirchner, facilitated Techint's business deal. Meanwhile, the former president was demanding a tough stance from Alberto Fernández's government because Paolo's company was requesting dollars from the Central Bank to import supplies from Brazil instead of utilizing its local production capacity. A tragicomic detail that illustrates recent political history: Kulfas was ousted after his mentor, former president Alberto Fernández, asked him to resign; in his place, for a brief period, Daniel Scioli took over, now in Milei's camp. The internal politics of the Frente de Todos coalition continued, but Paolo Rocca's group brought the sheet metal from Brazil, apparently using their own resources. They also built the Néstor Kirchner gas pipeline in partnership with Pampa Energía. The history of the Kirchner administration's relationship with the Techint Group was not without tension, nor without shady dealings. The company is implicated in the "notebooks" case of the taxi driver (with a whiff of intelligence service involvement) Óscar Centeno for having paid bribes to former Kirchner administration officials to obtain compensation for the nationalization of SIDOR in Venezuela in 2008. Both Paolo Rocca and executives Luis Betnaza and Héctor Zabaleta were prosecuted. Rocca was acquitted for lack of evidence. Betnaza and Zabaleta were acquitted by Judge Julián Ercolini because he confirmed that they paid bribes, but motivated by “humanitarian” reasons. The judiciary deserves the Nobel Prize in Literature. Milei's fantasies Federico Sturzenegger's defense of the Indian pipes in a lengthy post on the X network, where he summarizes the bible of the free market and low prices as the epitome of economic efficiency, ends up being either a display of total ignorance of current geopolitics or praise for Chinese capital, which will apparently supply the steel for the Indian company Welspun to produce the pipes for the gas pipeline. Techint's defeat in the contentious bidding process is not a triumph for the free market and Sturzenegger's fanciful pronouncements about an "invisible hand" leading to a paradise of benefits for all. This logic of thought, characteristic of Milei's political movement, clashes with that of Donald Trump, the government's main ally. The government, riding high on its success, also ignores economic efficiency and the "morality" of the state benefits enjoyed by Mercado Libre, or the overpricing that led to a scandal at Nucleoeléctrica Argentina, where Milei placed Demian Reidel, with whom he "rewrote" much of economic theory and aspires to win the Nobel Prize in Economics. However, Sturzenegger's discourse is consistent with the idea of a transition toward macroeconomic stability, with inflation tamed by the force of the free market. In reality, several elements of this thesis need to be questioned. First, inflation is not so tamed; since the 1.5% recorded in May 2025, it has shown increasing figures month after month. Second, a future slowdown in inflation will be the result not of the success of the official policy, but of an economy heading toward a landing—for now, a soft one—of its productive activity, which could turn into a recession in the medium term. The attempt to impose macroeconomic stability is perfectly combined with the attempt to discipline the working class by cutting wage purchasing power and adjusting public budget items linked to social spending. But the macroeconomic order in the financial field presents several weak points: on the one hand, with the issuance of bonds with capitalizable interest, the government presents a situation of financial surplus when the accounting of those interest payments would result in a financial deficit, which the Consultora 1816 estimates at 0.8% of GDP. On the other hand, the government's current financial respite, characterized by a stable dollar, moderate reserve purchases by the Central Bank, and a decrease in country risk, is based on dollar-denominated debt issuance by companies and provincial governments, as well as a certain financial appetite among investors willing to take more risks. This has been facilitated, for example, by Ecuador's return to debt issuance. However, it lacks a fundamental shift in the financial capital's perception of the difficulties faced by Economy Minister Luis Caputo in managing Argentina's debt burden. In fact, talk has ceased about the Scott Bessent swap, the US$20 billion that international banks were supposed to provide to finance Argentina. In January, Caputo was scrambling to find ways to meet an international payment. He faces the same situation by mid-year. Finally, the controlled dollar is based not on the free market, but on the Central Bank's exchange rate management with its band system. This policy, combined with economic liberalization for foreign goods and services, is unsettling for local manufacturers who see the influx of Chinese cars, textiles, cheap cell phones, and many other goods from other countries. This supposed macroeconomic stability contrasts sharply with two realities: the financial and primary production sectors are showing some dynamism, while industrial activity is entering a recession and has significant unused installed capacity. Since October, official data from the Monthly Economic Activity Estimator (EMAE) has shown that the more dynamic sectors are not offsetting the decline in those that are struggling: in fact, in October and November, INDEC recorded month-on-month drops in overall economic activity. A recent report from the Center for Studies in Argentine and Latin American Economic History (CEHEAL) presents an alarming picture: it indicates that the decline of Argentine industry between 2023 and 2025 is the most profound in two decades; it notes that although a technical rebound was observed in the first half of 2025, the recovery was interrupted by the third quarter (activity fell again by 2.4% year-on-year); which consolidated a new recession explained by the exchange rate lag and the decline in domestic consumption; of 24 manufacturing branches, 22 reduced their activity between 2023 and 2025, with food and energy registering positive dynamism that consolidates the re-primarization of the productive structure to the detriment of heavy industry. CEHEAL places Argentina's situation within a Latin American context in which "industrial GDP per capita has returned to 1985 levels, within the framework of a regional 'lost decade' characterized by deindustrialization and a loss of global manufacturing relevance." This definition summarizes the decline in which the Argentine and regional economies find themselves. This is the second transition that the Milei government seeks to impose: towards an economic structure with less industrial relevance and greater importance of extractive activities (hydrocarbons, agriculture, mining) that provide dollars to service the public debt in favor of imperialist financial capital. The cost of this second transition that is being imposed falls on the populations of the sacrifice zones where the benefits of extractivism do not reach, but the environmental damage does. But it also falls on urban workers: CEHEAL estimates a loss of around 100,000 industrial jobs starting in November 2023. These lost industrial jobs are mostly located in metropolitan areas of the provinces in the so-called central region of the country. The policies of the previous administration, which are leading to deindustrialization, are what prompted the veiled criticisms, prior to the more open confrontation, between Techint and the government: Paolo Rocca warned months ago about the lack of industrial policies. For Rocca, industrial policy doesn't mean promoting a vigorous investment process to expand the industrial sector or foster the development of new industrial branches, but rather protecting his business. Although the exchange rate lag partly explains the difficult industrial situation, investment reluctance, that is, the propensity of the country's richest capitalists to take dollars abroad, is also part of the explanation, among other factors, for the lag in productivity and the dependence of the Argentine economy on imperialist capital. The halt in local industrial investment contrasts sharply with Techint's decision to make significant investments in the United States in the not-too-distant future. It also contrasts with the group's and the broader industrial sector's commitment to partnering with extractive industries. A notable case is that of Martín Rappallini, president of the Argentine Industrial Union (UIA), who is a partner in the San Jorge project to extract copper in Mendoza. This project has faced widespread rejection from the people of Mendoza, who have demonstrated on highways, in the streets, and in assemblies to defend their water supply. Rappallini's silence regarding the controversy surrounding the pipelines, the difficult situation facing the industrial sector, and his involvement in mining businesses has sparked criticism from small and medium-sized enterprises (SMEs) within the UIA itself. This silence also contrasts sharply with his support for the anti-worker labor reform being promoted by the current administration. An ECLAC estimate of the distribution of Gross Value Added (GVA) in our country shows that an average of 72% of wealth during the period 2004-2024 was generated in the provinces typically referred to as the central region: the City of Buenos Aires, the Province of Buenos Aires, Córdoba, Entre Ríos, and Santa Fe. In terms of population, these provinces also represent 72% of the inhabitants. In 2024, the Province of Buenos Aires alone accounted for 33% of the wealth generated and 38% of the population. The policies of Javier Milei's government are leading to a shift in the axis of capital accumulation from the central region toward the Andes Mountains, which could be described as a third transition that is being imposed. The problem is that, taken together, the three transitions they are trying to impose would entail enormous destruction of industrial productive forces (but also of the scientific and technical capabilities of public institutions) and practically a civil war against the urban working class in the country's central region. The attack on the working class is also based, among other things, on the exploitative labor reform that the government will try to pass in Congress in the coming weeks. The intervention of the working class to defeat this labor reform project is fundamental for its future, as well as for reversing the extractivist course, shaped by imperialist financial capital, that they intend to impose. The country of smokestacks along the Paraná industrial belt would give way to a nation of extractive enclaves, where success is measured in cubic meters of exported gas, not in manufacturing jobs. In this capitalist "novel of entanglements," the 100,000 losses in industrial employment are not a miscalculation or a side effect, but the cost of a transition that aims to discipline the workforce. At the end of the day, the outcome of this war between powerful nations and capitalist conglomerates is uncertain, but the prize is clear: the common resources of Vaca Muerta and the Andes Mountains. If the working class fails to change course and establish a perspective for economic reorganization on new (non-capitalist) foundations, the controversial gas pipeline will end up transporting much more than gas: it will carry with it the remnants of a national productive structure. https://www.laizquierdadiario.com/Don-Chatarrin-descubre-el-libre-mercado-Milei-le-da-la-mano-invisible-a-China? Back |
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