Senators call to release drone memos
2/11/15 12:21 PM EST
A bipartisan group of senators filed an amicus brief with a federal court Wednesday in support of an ongoing lawsuit by the American Civil Liberties Union and The New York Times seeking memos about American drone operations abroad.
The four senators — Republican Rand Paul of Kentucky, and Democrats Martin Heinrich of New Mexico, and Jeff Merkley and Ron Wyden of Oregon — wrote that the Department of Justice’s legal memos on targeted killings represent an unconstitutional body of “secret law.”
They added their concern that “the Executive Branch’s excessive secrecy is frustrating the purposes of [the Freedom of Information Act] and impeding a healthy debate on an issue of paramount importance: when the Government may use drone strikes to kill one of its own citizens without charge or trial.”
The joint ACLU/New York Times lawsuit seeks to make public Justice Department memos on the 2011 killings of three American citizens: radical cleric Anwar al-Awlaki, his 16-year-old son Abdulrahman and 25-year-old Samir Khan.
During the summer of 2014, the U.S. 2nd Circuit Court of Appeals ordered the Justice Department to release a July 2010 memo on the issue of whether it is lawful for the executive branch to launch a targeted killing operation against an American citizen.
The ACLU/Times lawsuit seeks to uncover further redacted sections that contain constitutional justifications for the Justice Departments arguments, as well as other information.
The senators’ brief claims they wrote in order “to ensure that the public has enough information to hold its Government accountable.”
By Sebastian Rotella
A year and a half ago, I talked to Alberto Nisman, the Argentine special prosecutor whose mysterious death has made international headlines.
I didn’t know Nisman, but I knew the case he was investigating: the terrorist bombing that killed 85 people at a Jewish community center in Buenos Aires in 1994.
As a foreign correspondent, I had done a lot of reporting on the deadliest anti-Semitic attack in the history of the hemisphere. I interviewed survivors, investigators, diplomats, spies and shady characters from Latin America, the U.S. and the Middle East about an investigation plagued by corruption and cover-ups. Years later, I had watched from afar when Nisman succeeded in indicting Iranian officials and Hezbollah terrorists and securing Interpol warrants for them.
Nisman’s startling death last month left Argentina, a country for which I have great fondness, in turmoil. Sadly, that’s not unusual. The history of Argentina, and much of Latin America, is a chronicle of skullduggery: assassinations, massacres, scandals, frame-ups, convenient “accidents,” staged “suicides.” The Nisman case grows out of a labyrinth of lies and intrigue where almost everything seems possible except establishing facts, and almost nothing is what it seems.
Describing the elusive, chaotic reality of a South American nation, a U.S. law enforcement chief once told me: “The lights are going out in the house of mirrors.”
Although he wasn’t talking about Argentina, the image applies.
In the summer of 2013, I interviewed Nisman by phone and email. I agreed to meet him in Washington, D.C., where a congressional committee had invited him to testify about Iran’s spy network in Latin America and its alleged role in a plot to bomb John F. Kennedy Airport in New York. At the last minute, though, the Argentine government blocked his trip. President Cristina Fernández de Kirchner had agreed months earlier with Iranian leaders to set up a joint “truth commission” about the case, part of a geopolitical shift toward Iran and Venezuela.
Nisman and many others feared his own government intended to scuttle his prosecution.In an email to me on July 10, 2013, he wrote:”I followed the [Congressional] hearing on the web and I was very sorry I couldn’t be there.”
His troubles got worse. Last December, the government fired a powerful spy chief who was Nisman’s lead investigator. The prosecutor retaliated with a bombshell: He accused the president, her foreign minister and other political figures of conspiring to absolve the accused Iranians in exchange for commercial deals. Iranian diplomat Mohsen Rabbani, a top suspect in the 1994 attack, participated in secret talks, according to Nisman’s criminal complaint.
Argentine spies “negotiated with Mohsen Rabbani,” an indignant Nisman said in a television interview on Jan. 14. “Not just with the state that protects the terrorists, but also with the terrorists.”
The Argentine government denied his allegations.
Four days later, the prosecutor’s police bodyguards found his corpse in the bathroom of his high-rise apartment, shot in the head at point blank range with a .22-caliber pistol. He had borrowed the gun from an aide the previous evening, saying he was worried about threats. His death came the day before he planned to testify in the Argentine National Congress about his 290-page complaint.
Suicide remains a possibility. Authorities say there was no sign of a struggle or intruders. The workaholic 51-year-old was under great pressure. But Nisman’s family, colleagues and others, including political opposition leaders, say he was murdered. There was no suicide note. He spent his last days preparing his legislative testimony and talking about it with associates, politicians and journalists.
Why would Nisman kill himself at a landmark moment? If he did, was he driven to it by blackmail and threats, or a devastating revelation that hurt his case? If it was murder, did it result from feuds in the intelligence community pitting presidential loyalists against spies aligned with Western agencies? Which faction would benefit from his death?
Enduring Tradition: the ‘Liberated Zone’
The persistence of state-connected violence and intrigue in Argentina goes way back. As in other Latin American nations, criminal mafias flourish. They often have links to security forces and roots in the military dictatorship that ended in 1983.
Manipulation reaches extremes capable of causing paranoia. Consider the practice known as an “operetta:” Police team up with hoodlums for robberies, split the loot, then ambush their partners and claim a victory against crime. During a wave of robberies of upscale nightspots in Buenos Aires in 1998, stick-up men killed a police officer guarding a restaurant. It turned out the killers were serving prison sentences. Guards ran a scheme in which they sneaked inmates out long enough to commit robberies, then return with the perfect alibi: They were officially behind bars.
Tactics and terminology of the “dirty war” linger. During the dictatorship, uniformed police assisted death squads by withdrawing from the area around a target and establishing a perimeter to create a “liberated zone.” Argentines still use that phrase to describe police involvement in mafia activity. Breakdowns in Nisman’s security 2013 it took his bodyguards 10 hours to enter his apartment after he failed to answer phone calls 2013 have led to talk of “a liberated zone.”
Looking back two decades, the phrase could describe the landscape in which the terrorist attack that Nisman investigated took place.
After President Carlos Menem, the son of Syrian immigrants, was elected in 1989, he had friendly relations with Middle Eastern governments that included Syria and Iran, launching a nuclear cooperation venture with Tehran. A whirl of scandal soon engulfed Menem’s government. Mafias with Middle Eastern links infiltrated government ministries, the judiciary, security forces, border agencies and transport firms to launder money and smuggle arms, drugs, contraband and people.
The notorious Monzer al-Kassar, a Syrian arms trafficker now serving a 30-year sentence in the United States for terrorism, illegally received an Argentine passport in record time and, according to Kassar’s testimony to a Spanish judge, wore a jacket and tie for the photo borrowed from President Menem himself. Presidential relatives and top officials fell in corruption cases in the 90s involving Kassar and a shadowy Argentine tycoon of Syrian descent named Alfredo Yabrán.
A “suicide” in 1990 has gotten new attention after Nisman’s death. Police found Brigadier General Rodolfo Echegoyen, a customs chief who investigated Yabrán, with a bullet in his head and a suicide note nearby. Police forensic experts eventually determined that someone else fired the .38-caliber pistol that killed the general. Yabrán later shot himself ( though some people don’t believe it) as police prepared to arrest him for ordering another death that shocked the country: the killing of a news photographer by corrupt cops who tried to pin it on a band of petty criminals.
Fingering Hezbollah and Iran
Menem soon distanced himself from Middle Eastern rulers and grew closer to Washington, seeing strong ties to the United States as key to Argentina’s future. Two bombings hit Buenos Aires: The explosion at the Israeli embassy that killed 29 people in 1992, and the attack two years later at the Jewish community center, or Argentine-Israelite Mutual Association (AMIA).
The attacks were a national trauma, evoking a vicious anti-Semitic tradition in the security forces and politics. I began reporting about the AMIA case in 1996 as a correspondent for the Los Angeles Times 2013 the first of many terrorist attacks I would cover. It was painful to relive the massacre with survivors and Jewish leaders, to see their schools and synagogues protected by bomb barriers and police guards, to hear eloquent, tearful speeches demanding justice on each anniversary.
The investigation suffered from inexperience, ineptitude and corruption. A fog of doubt enveloped facts as basic as whether a suicide car-bomb was used. The federal police accused officers of the provincial police, their longtime foes, of providing the van allegedly used as a rolling bomb. The provincial police planted a “witness”2013 a convicted murderer whom they coached using the case file 2013 to divert investigators. Theories pointed at Iran, Hezbollah, Syria, and neo-fascist military veterans who mysteriously appeared at the blast scene with an ambulance.
Authorities charged Iranian diplomats along with the police officers, but a court acquitted the officers and another accused accomplice in 2004. The original investigators were themselves charged with bribing a witness and obstructing justice.
Then-President Nestor Kirchner, the current president’s late husband, decided it was time for a major effort. He appointed Nisman to lead a special prosecution unit with a generous budget and a staff of 80. Nisman worked closely with Antonio Stiuso, a veteran chief of the Argentine Intelligence Secretariat (SIDE) who had strong alliances with foreign services. They traveled to consult with U.S., Israeli and European counterterror agencies about the investigation.
In 2006, Nisman charged senior Iranian officials and leaders of the Lebanese terror group Hezbollah with plotting the AMIA attack, which was allegedly executed by Hezbollah militants and Iranian spies including Rabbani, the former cultural attaché in Buenos Aires. Interpol issued warrants for five Iranian suspects, including the country’s defense minister from 2009 to 2013, and Imad Mughniyah, the Hezbollah military chief who died in a 2008 assassination.
Despite many stumbles and defects in the investigation, most of the evidence and intelligence 2013 and the assessment of most U.S., Latin American, Israeli and European counterterror officers I’ve talked to 2013 points to Hezbollah and its longtime sponsor Iran in the embassy and AMIA attacks. The operations were part of a shadow war with Israel, counterterror officials say.
Argentina was an easy target because of weak law enforcement and a strong terrorist infrastructure in the region. Menem’s change in foreign policy also played a role, according to the Argentine charges.
Nonetheless, some Argentine commentators maintain to this day that terrorists connected to Syria 2013 and to Menemist intrigues 2013 committed the attack.
Iran denies involvement. In 1998, I interviewed the top Iranian diplomat in Argentina in the embassy that allegedly served as a base for the AMIA plot. He accused the CIA and the Mossad of framing his government.
“We have nothing to do with this because civilized men, men of culture, have no need to use savage weapons,” said Abdolrahim Sadatifar, the chargé d’affaires.
From Favored Son to Demon
In recent years, Argentina’s foreign policy became increasingly anti-Western as President Kirchner grew close to the late Hugo Chavez of Venezuela and his Bolivarian alliance. Her government clashed with Washington and, according to U.S. officials, cut cooperation with the CIA, DEA and other agencies. Argentine leaders improved ties with Iran, which expanded its presence in Latin America.
In 2013, Argentina and Iran agreed to the memorandum of understanding proposing a truth commission of third-country judicial experts to advance the probe with Tehran’s participation.
Leaders of the Argentine political opposition and the Jewish community criticized the idea of Iran, a longtime state sponsor of terrorism, helping to investigate its own officials. The proposal ultimately fizzled.
Nisman saw the drastic policy shift as a betrayal. He endured increased hostility from pro-government forces as well as anonymous threats to him and his two daughters, according to public statements of Nisman and others and press reports.
“He went from the favorite son to the demon,” Daniel Santoro, a respected investigative reporter for the Clarin newspaper, told me in a telephone interview last week. “It was a very brusque ideological change by the government, a swing of 180 degrees influenced by Venezuela.”
All the while, feuds heated up in the security forces. In a murky incident last year, a police SWAT team stormed the home of one SIDE chief and killed him in a shootout. A judge charged 10 officers with staging a drug raid to kill the spy, who was close to Stiuso. Political analysts see the ouster of Stiuso in December as a purge of a faction aligned with the CIA and other Western agencies.
Reportedly fearing he would be dismissed next, Nisman returned from a vacation in the middle of the Argentine summer and made his allegations against the president, describing the public agreement with Iran as a smokescreen for a conspiracy.
In the Jan. 14 television interview, Nisman asserted that telephone intercepts revealed a plan to blame the AMIA attack on “local fascists.” Nisman said Argentine suspects provided the Iranians with information about his investigation and “personal details” about him and his family. Suspects referred to him with anti-Semitic terms during phone calls, Nisman said in the interview. (The criminal complaint does not include phone intercepts of the president. AndForeign Minister Hector Timerman, who Nisman accused of being a central figure in the alleged conspiracy, is also Jewish.)
Nisman seemed more isolated and embattled than ever, Santoro said.
“He had ended up all alone,” Santoro said. “There was an environment of threats, a campaign of denigrating statements and harassment of the prosecutor.”
That context fits with scenarios of suicide or murder.
The president’s reaction to the death contributed to the uproar. Kirchner quickly took to Facebook to suggest that Nisman committed suicide. In a startling reversal days later, the president speculated that he was murdered and accused Stiuso of manipulating him with “false leads” to undermine her government. And she cast suspicion on the aide who loaned Nisman the pistol, though he has been charged only with the minor offense of giving a gun without legal authorization.
“This is the worst scandal for the president, the worst scandal since the government of Isabel Perón” in the 1970s, Santoro said. “The government has made remarkable errors.”
Like a Circus Act
Santoro published a scoop last week about how investigators found documents revealing that Nisman considered issuing arrest requests for the president and the other politicians. The government denied it. The president’s cabinet chief tore up a copy of Clarin on camera and called the newspaper garbage. But then the attorney general’s office confirmed the story.
Argentines have responded to the case with disbelief. History has taught them to see each detail as sinister. The investigation has moved slowly and key forensic work remains incomplete. Nisman’s hands didn’t test positive for gunpowder residue, though authorities say that could be explained by the pistol’s small caliber. The federal police have opened an internal investigation of Nisman’s 10-man protective detail, whose security measures were seemingly lax.
Nisman called Stiuso several times in his final hours, authorities said this week. Prosecutors have subpoenaed the veteran intelligence chief to testify. There is great expectation because Stiuso’s 43 years in the spy game make him a feared figure with vast knowledge of the political underworld.
It could be that Nisman was the victim of pro-government forces sending a mafia-style response to his challenge 2013 or of scheming rival forces trying to destabilize the government. The simplest scenario could also be true: He made hasty accusations against powerful people and, in a moment of regret and despair, killed himself.
The pervasive uncertainty reminds me of an experience I had in 1999 with a mysterious witness in the AMIA case. His name was Wilson Dos Santos.
Dos Santos was a fast-talking, green-eyed, 38-year-old from Brazil. He had masqueraded as an Italian engineer to marry a well-to-do woman, fooling her and her Italo-Brazilian family. He had allegedly been a police informant while peddling immigration documents and smuggling contraband at the “triple border” region of Argentina, Brazil and Paraguay, a base for gangsters and extremists with ties to Hezbollah and other groups.
Dos Santos seemed important because he showed up at the Argentine, Brazilian and Israeli consulates in Milan, Italy, in July 1994 and warned officials of an impending terrorist attack in Buenos Aires. He said he had done work at the triple border and elsewhere for a group of Iranian terrorists who had carried out the Israeli embassy bombing two years earlier and were plotting a new strike. The target, he said, was a building under renovation.
As often happens with “walk-ins” telling tales, no one took him too seriously. Until a week later, when the bomb blew up the AMIA community center, which was under renovation. Dos Santos testified at length in Buenos Aires. Then he self-destructed. He changed his mind, denied everything, was charged with perjury and fled to Brazil.
Nonetheless, his warning stood out as a rare fact in the sea of ambiguity. Investigators believed that foreign spies, perhaps in a Brazilian service, learned of the plot and used Dos Santos to indirectly send a warning.
I tracked down Dos Santos. We had an edgy conversation in the food court of a shopping mall in Sao Paulo. Two men watched us from a distance and one of them followed me to my car; sources told me that Brazilian authorities were keeping an eye on the recalcitrant mystery witness.
Dos Santos wore sunglasses propped on his head and acted skittish. He stuck to his new story. He said he wasn’t a spy and didn’t know any terrorists. The timing of his visit to the consulates was pure luck 2013 a “bingo.”
“I’m a fool,” he said. “If I were smart, I wouldn’t have made up this story.”
As he talked, I remembered the anguish of Luis Czyzewski, the father of an AMIA victim. Paula Czyzewski, a diminutive 21-year-old, was in the lobby when the explosion destroyed the community center and killed her at close range. Her mother survived because, at the moment of the blast, she had walked to the far end of the building to send a fax.
Czyzewski was a gentle, dignified man with combed-back gray hair and haunted blue eyes. In 1998, he had traveled to Brazil to see Dos Santos testify before Argentine prosecutors at a special hearing. As Czyzewski watched, he broke down in tears.
“For the first time, I had the sensation that I was seeing a person who could have participated in my daughter’s death,” he told me. “More than an interrogation, it was like a circus act. He overwhelmed himself with his own lies.”
The Nisman case inspires a similar mix of sadness, disgust and frustration. Argentines have been overwhelmed by lies over the years. No matter what the investigation of his death concludes, a lot of people probably won’t believe it.
The prosecutor has become another victim of a massacre that remains shamefully unsolved. Another victim of a labyrinth that leads not to justice, but to new labyrinths.
Related coverage: Read Sebastian Rotella’s investigation with PBS Frontline and The New York Times into failed intelligence before the 2008 Mumbai terror attacks.
By Gareth Porter
February 11, 2015
Who Killed Alberto Nisman? And Why?
The evidence already available about Argentine Prosecutor Alberto Nisman’s death from a gunshot to the head creates a strong presumption that he was murdered.
He was about to present publicly his accusation that President Cristina Fernández de Kirchner and her foreign minister, Héctor Timerman conspired to absolve Iran of the 1994 AMIA bombing and lift the Interpol red notices on the accused Iranians.
And it was Nisman’s 2006 request for the arrest of six former senior Iranian officials for the bombing that prompted his push for those red notices. In the context of Argentine political culture, with its long experience of impunity for crimes committed by the powerful, the circumstances of his death have led to a general conviction that the government must have been behind his murder.
But there is good reason to be cautious about that assumption.
Nisman’s case against Kirchner was problematic. The central accusation in his affidavit, made 96 times, according to press accounts, was that Kirchner and Timerman had sought to revoke the Interpol arrest warrants against the former Iranian officials.
But Ronald K. Noble, the secretary general of Interpol for 15 years until last November, denied Nisman’s accusation. Noble declared, “I can say with 100 percent certainty, not a scintilla of doubt, that Foreign Minister Timerman and the Argentine government have been steadfast, persistent and unwavering that the Interpol’s red notices be issued, remain in effect, and not be suspend or removed.”
Noble’s denial raises an obvious question: Why would the Kirchner government, knowing that Nisman’s main claim could be easily refuted, have any reason to kill him on the eve of the presentation of his case? Why give those seeking to discredit the government’s policy on the AMIA bombing the opportunity to shift the issue from the facts of the case to the presumption of officially sponsored assassination?
The Kirchner-Timerman negotiation of an agreement with Iran in January 2013 for an “international truth commission” on the AMIA bombing that would have sent five respected international judicial figures to Iran to question the accused Iranians. That was a way of getting around the Iranian refusal to subject former high-ranking officials to Argentine justice.
But Nisman was trying to prove that was an illicit cover-up for a cynical deal with Iran. He considered it “a betrayal of the country and his work,” according to his friend, Gustavo Perednik.
Nisman’s “criminal complaint” against Kirchner and Timerman claimed the government’s negotiations with Iran involved a “sophisticated criminal plan” to make a deal with one of the Iranians the prosecutor accused of the AMIA bombing, former cultural attaché Mohsen Rabbani. It asserted that Argentina promised Iran that it would lift the Interpol notices on the six Iranian in exchange for an “oil for grains” deal.
Nisman’s accusation was based on snippets of transcripts from 5,000 hours of wiretaps of conversations of allies of Kirchner government that have now been made public by a judge.
One of the excerpts quotes Rabbani himself, in a conversation with an ally of Fernandez: “Iran was Argentina’s main buyer and now it’s buying almost nothing. That could change. Here [in Iran] there are some sectors of the government who’ve told me they are willing to sell oil to Argentina … and also to buy weapons.”
The statement proves nothing, however, except that that Rabbani knew some Iranian officials who were interested in oil sales to Argentina. No evidence of Rabbani being involved in negotiating on behalf of Iran is suggested in the Nisman document, and the person at the other end of the line was not an Argentine official. So the conversation did not involve anyone who even had direct knowledge of the actual negotiations between the governments of Iran and Argentina.
The same thing applies to the other individuals who have been identified as speaking on the wiretaps in favor of such a deal. Those individuals are friendly with officials of the Kirchner government and friendly with Iran, but the actual negotiations were carried out by senior officials of the foreign ministries of Iran and Argentina, not by private individuals. The distinction between knowledge and hearsay is a fundamental principle in judicial processes for a very good reason.
The presentation of facts or allegations as proof of guilt, even though they proved nothing of the sort, was also a pattern that permeated Nisman’s 2006 “Request for Arrests” in the 1994 AMIA bombing.
Contrary to the general reverence in the news media for his indictment of senior Iranian officials for their alleged responsibility for the bombing, his case was built on a massive accumulation of highly dubious and misleading claims — from the “irrefutable evidence” of Rabbani’s participation in planning to the identification of the alleged suicide car bomber. This writer’s investigation of the case over several months, which included interviews with U.S. diplomats who had served in the embassy in Buenos Aires in the years following the AMIA bombing as well as with the FBI official detailed to work on the case in 1996-97, concluded that the Argentine investigators never found any evidence of Iranian involvement.
Nisman asserted that the highest Iranian officials had decided to carry out the bombing at a meeting on August 12 or 14, 1993, primarily on the testimony of four officials of the Mujahedeen E-Khalq (MEK), the Iranian exile terrorist group that was openly dedicated to the overthrow of the Iranian regime. The four MEK officials claimed to know the precise place, date, and time and the three-point agenda of the meeting.
When U.S. Ambassador, Anthony Wayne, meeting with Nisman in November 2006, asked him about Argentine press reports that had criticized the document for using the testimony of “unreliable witnesses,” Nisman responded, according to the embassy reporting cable, that “several of the witnesses were “former senior Iraqi [sic] officials, e.g. Bani Sadr, with direct knowledge of events surrounding the conception of the attacks.”
Nisman’s suggestion that former Iranian president Abolhassan Banisadr had “direct knowledge” related to the AMIA bombings was a stunningly brazen falsehood. Banisadr had been impeached by the Iranian legislature in June 1981 and had fled to Paris the following month — 13 years before the bombing.
Nisman also cited the testimony of Abolghasem Mesbahi, who called himself a “defector” from the Iranian intelligence service, that Iranian officials had made such a decision sometime in August 1993. But Mesbahi was known by U.S. intelligence analysts as a “serial fabricator,” who had also told an obviously false story about Iranian involvement in the 9/11 attacks. Nisman failed to mention, moreover, that Mesbahi had given a secret 100-page deposition to Argentine investigators in 2000 in Mexico in which he had claimed the planning for the attack had begun in 1992.
Nisman was so convinced of Iran’s guilt that he was ready to see almost any fact as supporting evidence, even when there was an obvious reason for doubting its relevance. For example, he cited Rabbani’s shopping for a van “similar to the one that exploded in front of the AMIA building a few months later.” In fact, however, as I reported in 2008, the Argentine investigation files include the original intelligence report on the surveillance of Rabbani showing that Rabbani’s visit to the car dealer was not “a few months” before the bombing, but a full fifteen months earlier.
Despite the Argentine intelligence following Rabbani’s every move and tapping his telephones for all those months, Nisman cites nothing indicating that Rabbani did anything indicating his involvement in preparations for a terror bombing. The FBI official who assisted the investigation told me in a November 2007 interview that the use of phone metadata to suggest that Rabbani was in touch with an “operational group” nothing but “speculation,” and said that neither he nor officials in Washington had taken it seriously as evidence or Rabbani’s involvement.
The fact that Nisman’s two indictments related to Iran and AMIA were extremely tendentious obviously does not dispose of the question of who killed him. But whatever the reason for his being killed, it wasn’t because he had revealed irrefutable truths about AMIA and Argentine government policy.
Gareth Porter is an independent investigative journalist and historian writing on US national security policy. His latest book, “Manufactured Crisis: The Untold Story of the Iran Nuclear Scare,” was published in February 2014.
This article originally appeared in Middle East Eye.
By Silvio Canto, Jr.
February 12, 2015
Twenty years ago, a horrible terrorist act killed 87 and injured over 100 in Buenos Aires, Argentina. It was the worst terrorist in this hemisphere before 9-11. It targeted Jews at a major Jewish Center.
Sadly, we are still waiting for a formal explanation of what happened. How does the murder of 87 people remained unsolved for 20 years? It is a scandal of hemispheric proportions!
The story has hit the international pages after the murder of Alberto Nisman, the prosecutor who was investigating the case and focusing on President Cristina Fernandez.
The investigation speaks volumes about Argentina, or what I call the dysfunctional nation. No one has done a better job of explaining Argentina today than Professor Jeremy Adelman (via Fausta’s Blog):
“You know there’s trouble when a country has to sign deals with rogue states to prevent economic Armageddon.
You know there’s serious trouble when a government parlays its investigation into a lucrative plan to botch it up.
The saga ravels together two longstanding problems.
The first is the vulnerability of Argentine institutions to manipulation and the weakness of the rule of law. After the AMIA bomb went off, then-President Carlos Menem promised justice. What followed was a sham. Corrupt police officers were arrested. Extraditions were deliberately bungled. One Iranian spy, Abolghasem Mesbahi, reported that Menem received $10 million in his Swiss bank account from Tehran to thwart investigators. The federal judge overseeing the case, Juan José Galeano, was finally impeached more than 10 years later. One of the leading voices in the campaign for greater transparency in the investigations was Cardinal Jorge Mario Bergoglio, now Pope Francis. In 2006, Nisman accused Tehran of abetting the Lebanese militants, Hezbollah, in the bombing.
To cap things off, in 2013 the Argentine government signed an agreement with Iran to form a “Truth Commission” to investigate the AMIA bombing. A year later, an Argentine court ruled the agreement to be unconstitutional. A stacked Congress is appealing the decision.
The Nisman affair is a saga that braids together incompetence, corruption, and murder on a global scale.”
Argentina has sadly turned into a country where no one trusts the government and everone knows that justice is for sale. It seems that everyone in the street suspects that Mr Nisman was murdered by those who did not want to hear what he had to say before Congress. Not a soul in Argentina believes that it was a suicide or accidental death. Yet, everything continues and the man and woman in the street grows more cynical by the second.
Of course, this latest episode is not without consequences. The government’s populist policies have scared international investors. It has created domestic havoc and put Argentina as #4 on Professo+r Hanke’s misery index. It has also exposed Argentina’s corruption and ties to rogue states.
Argentina is well known for “tangos”, often passionate songs about tragic love stories.
I don’t believe that any “tango”, past or yet to be written, can match the tragic reality of what we are seeing in Argentina today.
As a great friend from Argentina said: “Great country but always a tango”!
By Davide Scigliuzzo
11 February 2015
NEW YORK, Feb 11 (IFR) – Investors piled into a new US$500m bond from the City of Buenos Aires on Wednesday, hoping to reap hefty gains if and when Argentina mends fences with international creditors.
Argentina’s capital city amassed around US$2bn in orders for the six-year amortizing bond, which priced at par to yield 8.95%.
That was roughly flat to Argentina’s own curve and clearly piqued buy-side interest, taking into account the city’s stronger financial position and better credentials as a debtor.
“It is still attractive considering that the sovereign could tighten significantly post-settlement (with holdout creditors),” said a New York-based hedge fund manager.
“(The city’s bonds) could go back to trading 100bp-200bp tight to the sovereign.”
Still not all investors are convinced that now is the time for a debt play in Argentina, where the debt market has already rallied on hopes of a more market-friendly government come presidential elections in October.
“For me, Argentina is too expensive at the moment,” said one London-based portfolio manager who did not participate in the deal.
“We have had a very nice rally in Argentine assets, but you still need to see a resolution (with holdouts) for yields to come in.”
Faced with some investor pushback, Buenos Aires was forced to make some concessions on structure, opting against the inclusion of a call option that would have allowed officials to redeem the notes as soon as 2017 at a pre-determined price.
“Clearly there was a lot of resistance,” said the portfolio manager.
Final pricing came at the tight end of guidance of 9% area (+/- 5bp) and tight to initial price thoughts of 9.25% area.
The country’s local-law Bonar 2024s, which have an average maturity falling in 2021, were quoted at a yield of 8.8% mid-market on Wednesday morning, according to a New-York based broker, while the shorter-dated 2017s were spotted around 9%.
The new notes will have final maturity in 2021, but amortize in three equal installments over the least three years, for an average life of five years.
Fund managers took up the vast majority of the new issue, accounting for 76% of the allocation, followed by hedge funds with 17% and banks and private banks with 7%. Around 82% of the paper went to US investors, while European accounts took 18%.
Bank of America Merrill Lynch, HSBC and JP Morgan were the bookrunners on the deal, which is expected to be rated Caa2 by Moody’s, CCC- by S&P and CCC by Fitch.
By Chris Jasurek
February 11, 2015
The Chinese regime may be using arms sales to Argentina as a way to break into the Latin American market, says a new analysis from intelligence company IHS Jane’s.
During a Feb. 5 communiqué, officials from China and Argentina may have “affirmed a number of previously reported military programmes,” according to Jane’s.
The deals stretch the full gamut of Argentina’s military. They include weapons systems for Argentina’s army, navy, and air force.
“While 100 or more APCs [armored personnel carriers], up to five corvettes, or 14 new fighters may not significantly alter the balance of power with Argentina’s neighbours or in regards to Argentina’s ambitions to take the Falkland Islands (Malvinas),” states Jane’s, “this could also mark the beginning for more substantive Chinese military exports.”
Once the contacts are signed, the Chinese regime and Argentina may exchange military officers, and China may build military field hospitals in Argentina.
The deals could include co-production of military vehicles between the Chinese regime and Argentina.
According to Jane’s, vehicles co-produced by China and Argentina may include Chinese 8×8 VN1 amphibious armored personnel carriers (APCs), Chinese FC-1 fighter jets, and China’s 1,800-ton P-18N corvette naval warships.
If Argentina goes through with its programs to co-produce military vehicles with China, says Jane’s, the Chinese regime could get “its first significant military-commercial ‘beachhead’ in Latin America.”
The programs to co-develop military vehicles follows similar deals signed between Argentina and the Chinese regime in 2012. The Chinese regime will build a space tracking and control station in Argentina’s southern Neuquen Province.
According to Jane’s, the space facility will allow the Chinese regime to grow its satellite networks and expand its space programs.
“Argentine sources note that a crucial quid-pro-quo is that Buenos Aires will gain access to strategic information from China’s formidable surveillance satellite constellation,” it states.
The weapons sales to Argentina, coupled with the arms sales from China, according Jane’s, “creates a possible shift in the balance of power in Latin America and increase China’s military influence in the region.”
China’s New Frontier
The Chinese regime is working to expand its influence in Latin America.
Leaders from the 33-country Community of Latin American and Caribbean States (CELAC) met in Beijing in mid-January. During the meeting, the Chinese regime promised to invest $250 billion in Latin America over the next 10 years, and to increase bilateral trade by $500 billion.
The Chinese regime appears to be striking while the iron is hot. Latin American countries are experiencing their lowest economic growth rate since 2009, according to a Jan. 28 report from the Congressional Research Service.
At the same time, notes the report, Latin American countries have become more confident in their ability to solve their own problems, which has led them to be less dependent on the United States. Through this shift, it notes, China “has become a major trading partner for many countries in the region, ranking as one of the top two export and import markets.”
There is a pushback against China’s investment in Latin America and elsewhere
Chinese trade in Latin America has grown from around $18 billion in 2002 to nearly $260 billion in 2013, the report states, although it notes the United States is still the single largest trading partner for many of the countries with close to $846 billion in trade in 2013.
There is also a pushback against China’s investment in Latin America and elsewhere, which experts are comparing to China’s similar investment programs in Africa—deals where China’s investment programs have shown to help the countries in the short-term, yet harm them in the long-term.
Fact Check Argentina reported after a Dec. 29, 2014, agreement for Chinese investment, that the deal would “subvert Argentina’s labor force in favor of Chinese workers.”
It compared the investment to Chinese programs in Africa, where “Critics say that Beijing is only interested in Africa as a potential wellspring of mineral resources, and that its projects there often benefit governments more than local people.”
In Sri Lanka, there is a similar pushback against the Chinese regime’s investment projects. Recently elected Sri Lankan president Maithripala Sirisena says he hopes to change this dynamic.
Sirisena called the “credit money received from abroad,” which was broadly interpreted as referring to China’s investment, a robbery “taking place before everybody in broad daylight.”
“If this trend continues for another six years our country would become a colony and we would become slaves,” writes Sirisena in his election manifesto.