ARGENTINA: Argentine Congress approves OIL Company YPF nationalization spurring supporters of the bill to celebrate outside the congress building.

Record ID: 327776

  • Title: ARGENTINA: Argentine Congress approves OIL Company YPF nationalization spurring supporters of the bill to celebrate outside the congress building.
  • Date: 4th May 2012
  • Summary: BUENOS AIRES, ARGENTINA (MAY 03, 2012) (REUTERS) THE CONGRESS BUILDING VARIOUS OF DEMONSTRATORS ARRIVING AT THE CONGRESS BUILDING
  • Embargoed: 19th May 2012 13:00
  • Keywords:
  • Location: Argentina
  • Country: Argentina
  • Topics: Business,International Relations,Politics,Energy
  • Reuters ID: LVA46IEMEMI0KDWPPK2ZJT7Y65PJ
  • Story Text: Elated Argentines cheered their Congress' decision to nationalize the country's biggest oil company, YPF, underscoring the wide popular support that exists in this country for a measure that has rattled foreign investors and trade partners.
    By an overwhelming majority, the lower house Chamber of Deputies voted 207-32 in favour of expropriating YPF, clearing the way for President Cristina Fernandez to sign the bill into law. The Senate last week approved the measure by a similarly overwhelming margin.
    Congressman Edgardo Depetris defended the decision.
    "States are sovereign. States can decide what to do with their resources when they declare them public utilities and when it is made a strategic resource. Parliament is giving legality to a decision by the president of the nation and now tomorrow will be on its way to the appraisal court. This court is going to give the company a value and we are going to pay the price the Argentine appraisal court says," he said.
    Fernandez, a combative career politician who has tightened state control of the economy, unveiled the plan to seize a majority stake in YPF from Spain's Repsol six months after her landslide re-election.
    She justifies the nationalization of the company, which was privatized in the 1990s, on the grounds of slack investment to boost oil and natural gas production that has failed to keep up with growth in Latin America's No. 3 economy.
    Congressman Daniel Filmus said that YPF production must support the country's industrial growth.
    "And since we grew a lot we consume a lot more. So, to go along with this growth we have to show that YPF in the hands of the state is much more efficient, produces a lot more and it is enough to have the possibility to have the powerfully industrial country we deserve," he said.
    Repsol denies under-investing, but her message has struck a chord with Argentines, many of whom are suspicious of foreign companies and blame the free-market policies of the 1990s for setting the country up for its 2001/02 sovereign debt default.
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