THE WALL STREET JOURNAL: Argentine Leader Turns Inflation Ire Toward Shell: “A day after urging citizens to boycott the local unit of Royal Dutch/Shell Group for announcing plans to raise gasoline prices, Argentine President Néstor Kirchner called the company "one of the 10 worst" world-wide” (ShellNews.net) 14 March 05
DOW JONES NEWSWIRES
March 14, 2005; Page A15
BUENOS AIRES -- A day after urging citizens to boycott the local unit of Royal Dutch/Shell Group for announcing plans to raise gasoline prices, Argentine President Néstor Kirchner called the company "one of the 10 worst" world-wide.
Although Mr. Kirchner's ire during the previous two days focused on inflationary concerns related to a price increase, Friday's tongue-lashing was aimed squarely at the company. "We want a lot of investment to come, but we obviously don't want the worst in the world to come," he added, attributing the label to a 2002 report by U.S. watchdog group Multinational Monitor.
Verbal assaults against foreign companies are nothing new to Mr. Kirchner, who on Thursday urged citizens to join in a "national boycott" of Shell for announcing it plans to raise prices between 2.6% and 4.2%. But the anti-Shell campaign is raising some eyebrows in boardrooms here.
Mr. Kirchner frequently blames multinationals for playing a disruptive role in Argentina's economic crisis of 2001-2002, which resulted in the government defaulting on more than $100 billion of debt. Currently, negotiations for new contracts with foreign companies operating the nation's utility companies have been contentious.
Some observers believe the administration is trying to make operating in Argentina as unattractive as possible to encourage the sale of foreign-held assets into local hands.
"You read between the lines in Kirchner's public speeches and see that he looks with favor on national companies," said an official at a foreign-controlled company. "It's a tendency that appears to be stronger every day, especially since the debt swap [completed last month]. Instead of calming down, it's like he's just gone on a campaign."
In response to complaints that the president's boycott will only hurt Argentines who independently operate some 800 of the 900 or so Shell service stations here, Mr. Kirchner offered another option: "They can get a patent with Enarsa, with PdVSA, or the other oil companies that work here," he said.
Enarsa, Argentina's new state-run oil company, consists of some two dozen employees. As such, it has looked to develop projects with operating companies, such as Venezuela's state-owned PdVSA. Last month, PdVSA and Enarsa opened two service stations in Buenos Aires amid speculation -- later confirmed by Shell -- that PdVSA was in talks to buy Shell's service stations in Argentina.
Shell representatives declined to comment about the potential boycott.
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