Rise of the Argentine Empire

The steel industry has always been a key focus of the San Martin government. Argentina's steel production capacity has increased twentyfold compared to five years ago, but it still falls far short of meeting the needs of Argentina's economic development.

After all, Argentina is not so lucky as to have the help of the Soviet Union or the United States, nor does Argentina have the ability to independently develop its steel industry. Furthermore, due to its isolation in South America, its importance in the world is less than that of Brazil.

For Argentinians, Americans have never been a good thing, and are even their biggest competitors. Argentina's wheat and meat have consistently been unable to enter the US market, and even the European market has been occupied by American agricultural products.

Industrial products are even worse. Argentina currently has an extreme shortage of American industrial equipment. Because the new president has opened up to the world, a number of Argentine companies have been bought by large American companies at low prices, and competitive pressure has become very high.

These foreign investments, especially American investments, are not entirely investments in industrialization, but more often of a monopolistic nature, such as banks, tobacco companies, automobile assembly plants, and oil.

Fortunately, Argentina's connection with Western Europe is smooth. Even without the United States, some advanced steel smelting technology and important production equipment can be imported into Argentina. It may cost more money, but it can still be bought.

Steel is the foundation of an industrialized country. If Argentina wants to achieve initial industrialization, San Martin himself estimates that it needs to produce at least 80 million tons of steel annually. After all, tiny South Korea produced 60 million tons of steel at its peak, and Japan had 120 million tons at its peak.

Prioritizing the development of heavy industry requires a large amount of capital investment. Argentina didn't have money before, and it still doesn't have money now. The La Pampa provincial government is not rich either, barely maintaining fiscal balance through heavy borrowing and customs tax revenue. The city hall of Blanca is relatively wealthy, but after all, it has not truly developed yet.

Why does the La Pampa provincial government, headed by San Martin, want to build the La Pampa Grand Canal ahead of schedule? It may seem unnecessary, but investing in infrastructure construction is, after all, a very good carriage for developing the economy, and it can also better develop agriculture along the river.

The total investment in the La Pampa Canal may exceed 200 million US dollars, but it can bring 500 million or even 1 billion US dollars in value, which is still relatively cost-effective, and it can bring in 30-50 thousand people.

This project has already received the support of the Presidential Palace. Buenos Aires will transfer a large number of unemployed people to the La Pampa Canal project. Most of these people come from the "poverty towns" of Buenos Aires, a type of shantytown, the embryonic form of future slums.

This will alleviate the unemployment crisis and secure 40 million US dollars in low-interest loans from Argentina's two national banks, as well as 2 million US dollars in subsidies, and also obtain investment from three state-owned power companies, greatly relieving the pressure.

The main force of Argentina's industrialization has become dominated by the military. The generals under President Aramburu almost all control several large factories, including a general who advocates nationalizing Rheinmetall Military.

This is San Martin's ally in Argentina's industrialization. The compradores of Argentina cannot carry out industrialization. These generals of the Ministry of Defense are mainly in the military industry, and relations have improved somewhat. A lean camel is bigger than a horse. The development of Rheinmetall Military is still moving forward, although this military industrial group no longer belongs to San Martin.

Although San Martin is not a traditional soldier, at least not one who has been promoted normally, he is now also regarded as a high-ranking military official. He has integrated into this circle.

In addition to the military industry, the automobile industry and the petrochemical industry are developing quite rapidly. Overnight, Reidon Motors has 23 more foreign competitors in the automotive industry, mainly American and European automobile companies. Ford, General Motors, Chrysler, Citroen, and Mercedes-Benz are all building new automobile factories in Argentina. These companies are major customers for future steel plants.

The construction of new automobile factories will take two or three years.

The oil industry is also the same. The Federal Petroleum Reserve Company YPF has signed a contract with the American Standard Oil Company to develop oil, which requires a lot of steel, which is a very large demand.

Returning to the canal project, this is just one of the infrastructure projects in La Pampa Province. San Martin also wants to build a large number of urban infrastructure facilities. The leadership of the coastal expressway has also risen from the city of Blanca to the provincial government. There is also the deepening of the Blanca Bay port and the construction of various water conservancy facilities, with a total investment estimated to exceed 1 billion US dollars.

However, the landlord's family has no surplus food either. San Martin has to go through a number of American companies, but it is not convenient. Sequoia Investment Bank even plans to acquire a commercial bank, but it is relatively difficult because the United States currently does not allow investment banks to hold commercial banks, requiring financial "innovation" to do so.

In 1933, with the advent of the "New Deal" era, the US Congress passed the famous financial risk control act, the Glass-Steagall Act, which strictly separated commercial banks and investment banks.

If a US commercial bank could be established to conduct international investment and invest in Argentina, then Argentina could obtain more funds and loans, but this is not realistic. At least, such a sucker is impossible to exist.

The core of the Argentine Cohen Consortium is Balvanera Bank, currently one of the largest private banks in Argentina, with total assets exceeding 500 million US dollars, of which loans exceed 300 million US dollars, but this is the data for the entire Argentina, and it is impossible to lend all the funds to La Pampa Province.

The Blanca Commercial Bank, under the jurisdiction of the Blanca city hall, is developing rapidly, but its ability to attract money is not strong either. It would be difficult to lend out 100 million US dollars a year. In the final analysis, Argentina's overall economic strength is not enough, and everyone is unwilling to save money.

Despite the difficulties in development, San Martin still established the La Pampa Commercial Bank. This is the second local commercial bank in La Pampa Province. Previously, no one in La Pampa Province would open a bank, as it was a money-losing business. Now, it is very difficult to open one, and the provincial government would not approve it.

With a bank, it is possible to raise funds. The La Pampa Commercial Bank was established to absorb more deposits, but it cannot play a very big role at present. The Blanca Commercial Bank has also expanded to its limit.

However, these banks are more of an auxiliary nature. The core now is still to develop the steel industry, which is also an industry that can always make money.

Argentina's steel plants are not too many now, but too few.

Twenty more La Plata steel plants would be about right.

Steel is also an important basic industry supporting the automotive, home appliance, shipbuilding, machinery, and construction industries.

Argentina's automobile industry is starting with difficulty, the home appliance industry only produces some electric fans, or buys spare parts to assemble some refrigerators, and the shipbuilding industry still imports British diesel engines. This is not an excuse for not developing the steel industry.

The development of the steel industry has a strong driving effect on upstream and downstream industries, so developing the steel industry helps to enhance Argentina's industrial competitiveness and ultimately promote Argentina's national economic growth.

The development of Argentina's steel industry can not only reduce the import of steel and improve the foreign trade structure, but also lay the foundation for the development of heavy industry and promote the development of other industrial sectors.

Therefore, the La Pampa Provincial Government promulgated the "Law on the Promotion of the Steel Industry", which clearly supports the expansion and growth of La Pampa's two major steel companies, namely Blanca Steel Company and Hans Steel Company, and also established a third steel company, Medanos Steel United Company.

The provincial government also provides various preferential conditions to private companies, such as long-term loans with lower interest rates, large-scale construction of infrastructure, and the provision of cheap land.

The steel industry is a capital-intensive industry with very high barriers to entry. Only with a certain level of production capacity can economies of scale be guaranteed.

Therefore, the provincial government concentrates resources on the steel industry and provides support in finance, taxation, foreign loans, and technological development.

San Martin's strategy is to build a representative state-owned enterprise and concentrate resources to cultivate it. Blanca Steel Company and Hans Steel Company are both private steel plants. Blanca Steel Company is the steel plant of the Cohen Consortium, and Argentina's largest La Plata Steel Plant is also a private steel plant.

Currently, Argentina does not have a large state-owned steel plant. The largest state-owned Buenos Aires Steel Plant only produces 200,000 tons per year, and this is because a new blast furnace was built in the past two years.

Therefore, San Martin, in the Medanos County on the south bank of Blanca Bay, used the State-owned Assets Committee of La Pampa Province to establish the Medanos United Steel Company, integrating state-owned factory resources to develop a state-owned steel company.

Medanos County is located south of the provincial capital of Ajo District. It is a thriving agricultural county with an area of 1,200 square kilometers and a population of 30,000. It is the largest suburban county in Blanca City. The harbor here is excellent, but economic development is lagging behind, completely incomparable to Alta District, the largest district in Blanca City.

The coastal highway of La Pampa Province has begun construction southward from the city of Bahía Blanca. Transportation is not a concern, and the port of Médanos has also begun construction. Bahía Blanca now has more than 10 ports built, distributed along the coast.

José himself is in charge of Médanos United Steel Company. The La Pampa Provincial Government has raised 30 million US dollars in loans, using the most cost-effective 500 cubic meter blast furnace technology, allowing the La Plata Steel Plant and Bahía Blanca Steel Plant to directly support the construction of the new steel plant.

In less than a year of José's administration, the overall debt scale of the La Pampa Provincial Government has rapidly reached 180 million US dollars. This is just the beginning. José has already started contacting foreign banks, hoping to obtain more loans for economic development, especially the development of the steel industry, as well as the petrochemical industry.

This is unavoidable. Loan-based development has become an inevitable path. Although most of these 180 million were obtained by José through loans from American companies, mainly from Sequoia Investment Bank.

La Pampa Province's tax revenue is currently insignificant, not even as much as the money collected by the Bahía Blanca Customs. Tax system reform is still bogged down in disputes, as it is the lifeblood of the municipal governments below and a major obstacle. Although most of the financial power has been controlled,

tax collection is still dominated by the people below.

José has to rely on external loans, which he is quite good at.

He has also begun to prepare for some cooperation with foreign consortia or at the national level, which depends on the bargaining chips in his hands.

As the administrative head of a province, he is qualified to do so. What José urgently wants most is to hook up with the Soviets, but it is too far away. As a second choice, Germany, France, Britain, the Netherlands, Belgium, and Italy would be great if they could establish some official-level cooperation, such as establishing consulates.

Argentina is an immigration country and has relatively close relations with Europe. José is also looking for channels to establish various foreign cooperation.

Some of his capital in the United States has also entered these European countries, and Prari International also has some investments in Europe.

But this time it is to obtain foreign investment. There are already many foreign companies in Bahía Blanca, but they are too small in scale.

These foreign companies are unlikely to invest in the steel industry. Everything still depends on oneself.

They can invest in high-profit industries like automobiles, petroleum, and tobacco, but definitely not in steel.

José's focus on attracting investment from Western European countries is on other industries.

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Through the construction of the La Plata Steel Plant, Argentina has basically mastered the construction of 500 cubic meter blast furnaces. However, what they are now challenging is not 500 cubic meters, nor 1580 cubic meters, but the more difficult 2000 cubic meters.

In the coastal industrial avenue of Alta District, Bahía Blanca, a super-large steel plant covering 3,000 acres is taking shape. This is the headquarters of the second plant of Bahía Blanca Steel Company.

The planned total investment scale exceeds 100 million US dollars, with a construction period of 3-5 years. It is expected that the annual ironmaking capacity will reach 5 million tons, and the steelmaking capacity will be 4 million tons, making it Argentina's super steel plant, with a scale exceeding Argentina's entire annual output last year.

The first plant of Bahía Blanca Steel Company is located on the other side. It has almost completed the construction of 12 500-cubic-meter blast furnaces, and it is expected to reach an annual production capacity of 4 million tons next year. However, the 500-cubic-meter blast furnace can only be regarded as a temporary measure after all.

Not far away is the new plant area of Hans Steel Plant, which also covers 2,000 acres. The construction scale of Hans Steel Plant is 2 million tons of ironmaking and 1 million tons of steelmaking.

After completion, Bahía Blanca Steel Plant will surpass Hans Steel Plant and La Plata Steel Plant to become a world-class steel giant.

After World War II, the steel production capacity of major steel powers in the world increased rapidly. The increase in the number and scale of urbanization and towns led to the expansion of infrastructure construction space, which increased steel production from the demand side. Other factors, such as the development of international trade, also stimulated a sharp increase in steel demand.

The steel production capacity of Asian countries such as Japan, New China, and India has increased rapidly, and many new technologies have been applied. Among them, Japan has developed the fastest. Japan focuses on developing heavy industry, and investment in the steel industry has increased, and crude steel production has also surged. The average annual compound growth rate after World War II was as high as 22%. Japan reached 9.41 million tons, and New China reached 2.85 million tons.

Under the support of the Soviet Union, New China started the First Five-Year Plan with the 156 project as the core. After the implementation of the first five-year plan, steel production may increase to more than 5 million tons.

In Europe, after the establishment of the Coal and Steel Community, Western European steel production capacity has been growing at a rate of almost 10 million tons per year, and supply is in short supply. Among the three giants in Western Europe, West Germany produced 21.34 million tons, the United Kingdom 20.11 million tons, and France 12.63 million tons.

The steel production capacity of the superpowers, the United States and the Soviet Union, has also increased rapidly. Last year, the United States produced 106.17 million tons and the Soviet Union 45.27 million tons.

Argentina's steel production reached 3.2 million tons last year, ranking 13th in the world, lower than Italy, Czech Republic, Canada, and the Netherlands. It did not enter the top ten as José had expected. Even so, Argentina's steel production is very impressive, ranking among the top steel powers in South America.

The main reason for the low steel production capacity is that the third blast furnace of the La Plata Steel Plant was put into operation at the end of last year, and production will only be possible this year. The 12 500-cubic-meter blast furnaces built by the Bahía Blanca Steel Plant and the 6 500-cubic-meter blast furnaces of the Hans Steel Plant are estimated to be put into operation at the end of this year at the earliest. The construction progress of blast furnaces in other domestic private steel plants is also slow. From this point of view, Argentina's steel production this year is estimated to lag behind again.

José, through Thunder Mining, established Australian Mining, Colombian Mining, and South African Mining to mine and purchase coal, ensuring the coal needed for steelmaking.

In terms of domestic coal and mineral exploration, José newly established Southern Mining Company to conduct geological exploration in the Patagonia region. Argentina has so much peat. If several high-energy coal mines are found, it will greatly alleviate the risk of supply disruptions.

In terms of iron ore, Uruguay Iron Mine, Northwest Argentina Iron Mine, Brazil Iron Mine, and Bolivia Iron Mine were established through Prari International to ensure sufficient supply of iron ore.

The new steel plant adopts a large number of advanced technologies. The scale of the blast furnace will be an astonishing 2,000 cubic meters, which is larger, more technologically advanced, and more energy-efficient than the 1,580 cubic meters of the La Plata Steel Plant.

At the end of last month, after the successful ignition of the third large blast furnace of the La Plata Steel Plant, capacity expansion was temporarily stopped.

The real vitality of the steel industry is not here, but around the Bahía Blanca Special Steel Plant. The special steel plant is the old plant area of the Bahía Blanca Steel Plant, mainly based on converters. After two years of expansion, the annual steel production can now reach 1.6 million tons, making it the second largest steel plant in Argentina, capable of producing a large number of important materials such as stainless steel, cast steel, steel plates, and spring steel, second only to the La Plata Steel Plant in scale.

The Bahía Blanca Special Steel Plant is now in deep cooperation with the Hans Steel Plant. After the molten iron from the blast furnace of the Hans Steel Plant is released, it is directly sent to the converter of the special steel plant for smelting and processing.

The most active steel market in Argentina has formed around the plant areas of the two major steel plants, which is far higher than the steel markets in La Plata and Buenos Aires.

This market is inseparable from the support of the Bahía Blanca Municipal Government. As the city with the most rapid urban scale growth in Argentina, Bahía Blanca's demand for steel has increased rapidly. Industries such as road and bridge construction, real estate, construction, machinery, automobiles, shipbuilding, railways, and petroleum all require massive amounts of steel.

This has also generated a large amount of demand.

80% of these steels are consumed domestically in Argentina, and the rest are used for export.

Argentina's major industrial cities have obtained the newly added steel production capacity of La Plata and Bahía Blanca, and the economy has begun to return to normal growth. Other surrounding countries also hope to import steel from Argentina, which is why José is continuing to build the Bahía Blanca Steel Plant non-stop. Now, producing one more ton of steel can earn a lot more money, which can be described as a highly profitable industry.

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