Despite frequent denials and mutual admonitions Latin America has responded to its commodities-fueled economic boom with military regeneration and rearmament of varying intensity.
The more cash-endowed of the Latin Americans states have set out to spend more, even borrowing against future income, as in oil-exporting Venezuela.
Argentina is neither cash-rich nor at risk of attack from its neighbors. But it has a simmering feud with Britain over the Falkland Islands, the South Atlantic Overseas Territory of London that it overran in a 74-day conflict in 1982 and was beaten back by British forces with the loss of 1,000 lives among Falkland civilians and troops on both sides.
Argentina wouldn't say why it wants a nuclear-powered submarine but defense analysts cited neighbor envy. Brazil is lavishing tens of billions of dollars on military regeneration, which it sees as a future export earner, and a nuclear-powered submarine is part of the plan. France will help Brazil build the submersible, plus four more, and expects to profit from other military hardware sales to Brasilia.
Argentina has no such strategic plan at work but it argues that higher defense needs are a natural outcome of its stepped up campaign to get Britain out of the Falklands.
Argentina has blocked Falklands shipping, punished vessel operators with any suspected links to Falklands and got Latin American neighbors to support its sovereignty claim over the Falklands at international forums.
A nuclear-powered submarine is seen as a potential deterrent and prestige-earner in relation to neighbors and adversaries alike.
There's only one problem: Argentina isn't saying how it will fund it. The country is heavily in debt and struggling to be accepted back into international capital markets.
Argentine Defense Minister Arturo Puricelli said Argentina intended to install a nuclear reactor into a conventional diesel-electric TR-1700 (Santa Cruz) Thyssen submarine. He didn't mention the cost or the timeframe for the construction and commissioning of a nuclear-powered submarine.
Argentina, like Brazil, is a nuclear power with earliest work in the technology dating back to 1964. It operates two nuclear power reactors that meet 1-10th of its electricity needs and a third reactor will come on stream next year.
Argentina's early plans to produce nuclear weapons faced problems because of military rule and opposition from the United States. Argentina has lagged behind Brazil, which sees nuclear fuel reprocessing as a growing business opportunity and is widely seen to be more advanced in its nuclear industries.
Puricelli said plans for developing a nuclear-powered submarine followed orders from President Cristina Fernandez de Kirchner.
"President Cristina Kirchner has requested us to come up with a nuclear propulsion development project for our submarines," Puricelli said, adding the country already has capacity to develop nuclear propulsion for submarines.
Puricelli said Argentina is working on two submarines -- Santa Fe and San Juan -- and hopes to equip Santa Fe with nuclear propulsion. Work on a specially adapted reactor involves scientists from the National Atomic Energy Commission and the National Institute for Space and Nuclear Technology.
However, the Santa Fe submarine isn't a new project. Argentina bought it in the 1980s and until recently the Thyssen submersible was distributed in crates at the Domecq Garcia shipyard, waiting for assembly.
Argentina's original plan called for six vessels, two TR-1700s built in Germany by Thyssen Nordseewerke, two in Argentina by Astillero Domecq Garcia and two smaller TR-1400s also built in Argentina. A later agreement in 1982 was modified to six TR 1700s.
By last accounts, only about 75 percent of the submarine has gone through assembly stages -- and that doesn't include any part of the planned nuclear reactor.
Critics quoted in the media called the project "pharaonic" -- a reference to the president's alleged tendency to embark on ambitious costly projects.
Unnamed naval sources quoted in the media also called the submarine project inappropriate for Argentina in its present economic straits, MercoPress reported. Argentine military commanders have been fighting for more funds for basic refurbishment of the armed forces equipment.
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