Sunday, January 24, 2010

Great Britain, Argentina Relaunch Old Fight

Great Britain and Argentina are having a new diplomatic row over an old issue – the Falklands Islands. Last month Argentina passed a law claiming that they own the Falklands (or Las Malvinas as they call them), Britain has sent a note to Argentina’s embassy in London saying their new law was utter nonsense (in so many words). The two nations have debated the issue for decades – Argentina cites the island’s proximity and an 1820 decree as the source of their claim, the British respond by saying they’ve possessed the Falklands for nearly two centuries and that the islands approximately 3,000 residents overwhelmingly want to remain part of the British Empire.

Back in 1982 Argentina tried to retake the islands by force. The British responded by sailing a naval flotilla halfway around the world, which then promptly routed the Argentines and restored the Falklands to British rule. While the two nations relaunched diplomatic relations in 1990, they still have never settled their dueling claims of ownership over the islands.

So why bring this issue up now? One possible explanation is that Argentina’s President Cristina Fernandez de Kirchner could be using the dispute as a way of shifting her nation’s attention from a collection of bruising domestic issues. Kirchner is trying to restructure her nation’s debt through a swap of foreign currency for defaulted bonds and she’s having a very public fight with her own vice president. Another possibility though is that old international relations fallback – oil.

New exploration indicates that there could be vast reserves of oil under the seabed surrounding the Falklands, some projections say the region could hold as much as the North Sea. Drilling on the first test well is planned to start next month. If the reserves pan out, it would mean an economic boom for the Falklands – the residents would get a 9% royalty on all the oil extracted from the seabed around the islands. Of course the nation that owns the Falklands would also own the oil around them, which could explain Argentina’s newfound interest in the islands.
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