THE INTENSIFIED RIVALRY BETWEEN BRAZIL AND ARGENTINA

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP85T00875R002000120044-5
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 12
• Document Creation Date: December 20, 2016
• Document Release Date: August 17, 2006
• Sequence Number: 44
• Publication Date: September 4, 1973
• Content Type: REPORT

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The Intensified Rivalry Between Brazil and Argentina
-'C IAA
DOCUMBIT SEVJCES BRANCU
r LE COPY
aid 1tJT DESTROY
Secret
O/NE Memorandum
4 September 1973
Copy No.
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CENTRAL INTELLIGENCE AGENCY
OFFICE OF NATIONAL ESTIMATES
4 September 1973
THE INTENSIFIED RIVALRY BETWEEN BRAZIL AND ARGENTINA
The intensified rivalry between Brazil and Argentina for
leadership of South America, spurred on by the return to power of
Juan Peron, could produces periodic sabre-rattling along the borders
as well as diplomatic arid political confrontations on a variety of
fronts. The rivalry 0.17, complicate US relations with both countries
and with the region as a whole. The principal challenge to the US
will be to maintain cordial and productive ties with Brazil while
keeping Argentina from becoming an implacable enemy of the US and
a force for carrying all of the Spanish-American nations in that
iirection.
Thic mamorevuium waa prepared in the 0ffico of Nat~onut Eotimatoo and
was dioauo'ad with appropriate offices in CIA. Conrranto may be addrooood
to:
SECRET
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1. Juan Peron's resumption of power in Argentina is a nightmare
come true for Brazil's military leaders. They did not got along well
with Argentina's other chiefs, but they were at least happy to see the
Peronist movement excluded from the government. The Peronist victory
at the polls was a nasty surprise for the Brazilians, and, now that
Peron himself is ready to resume the presidency, the Brazilians are
especially concerned. 't'rey despise Peron and what he stands for, in
particular his pointedly anti-Brazilian nationalism, his demagoguery,
and his belief in a powerful labor movement. The Brazilians are worried
about the security implications of having an implacable enemy back in
power next door and the political implications of Peronist political
attitudes infecting the Brazilian populace. In turn, Peron despises
I,ne Brazilians and resents their accomplishments of recent years. On
certain issues Peron may have gro1'n more mellow and cautious over time,
but his firm conviction that Argentina must challenge Brazil for lcadc.,t
ship in South America has apparently not diminished.
2. It does not take much to rekindle the bitter rivalry bet.wccr
Argentina and Brazil. In effect, the t .v populations leave little in
cor:rrxn except their 'Wrder. Argentina with its Spanish licri:age,
European population, and co-stopolitan : ojihi5ticatit,rt cor r,a st . sharply
with lir.azil's Afrt~-i'ortuluc c heritage, r.ulti-racial population, and
leave grown culture. Argentina has a huge middle class ilnd a literacy
irate of ove . 90 I rA-cnt; 1tr3: il's raiddlc class is X11, the gh grow ng,
? ~itti
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and the literacy rate in Brazil is barely above 50 percent. The
Brazilians consider the Argentines haughty, patronizing, and racist;
the Argentines see the Brazilians as mongrel and uncultured. They are
classic enemies.
3. For well over a century, the course of Argentine-Brazilian
diplomacy has been one long struggle fnr leadership on the continent.
They fought two wars over Uruguay in the nineteenth century, and,
although they have not come to blows since, thoy have almost invariably
been part of opposing alliances. For geopolitical reasons, Argentina
has been allied most often with Peru, whereas Brazil has seen its
interests generally coincide with those of Chile. The so-call
buffer states between Brazil and Argentina (Bolivia, Paraguay, and
Uruguay) have been the chief targets of the various power struggles.
4. During the years of the first Peronist 'ovcrnment (1946-1955),
Argelitina had clear- superiority in the economic area was by far
the predominant power ir. the southern cone of South America. 'this
is no longer the case. Brazil's ccon'xisy is booming, and its industrial
exports arc expanding rapidly; Argentina is suffering from a frustrating
pattern of stop and go growth and high inflatlor.. Moreover, Brazil's
rdlitary?ir oscd political stability centrastrs sharply with the chiotic
r^.anruvcring f; Atgcntinc politics. The acccx-panying Brazilian dyna,-lir~i
and .;elf-ccni ide; c ,a led to ignificar,t change s in its rely ions
with its rxihber s.
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5. Brazil has used its now economic might and political energy
to become the predominant outside power in Uruguay, Paraguay, and
Bolivia. In May 1973, Brazil and Paraguay agreed to build the world's
largest hydroelectric power plant at Itaipu despite strenuous objec-
tions :From Argentina. Brazil offered Paraguay improved outlets for its
exports and promised to purchase nearly all of the power generated by
Paraguay's share of the complex. The Argentines, worxicd about jeopar-
dizing clams on the lower Parana River, simply could not match Brazil's
offer, In the last few months, brazil has also strengthened its eco-
nomic and political ties with Bolivia. Brazil has agrecd to construct
rr steel mill in Bolivia and a gas pipeline from Santa Cruz to Sao Paulo;
..vid Bolivia's Preside'it Banzcr, fearful that the friendship of the
Argentine government Could no longer be counted on with Peron back in
power, has agreed to move closer to Brazil diplomatically. In Uruguay,
the ilrazilians have close tics with the anny, in part because of earlier
assistance in coping with the Tupm :o terrorist:;.
0. ?il;c tram;-,bn:izonic highways, aside from opening new pcrspcc-
t.ivc:; tar ccon,c ;air growth, are projecting Brazilian influence to and
~cnc uclna, the Guyazaas, and Colombia. And Brazil liar. made or rturr: to
111 the South k.iericunt countries with iLc:ah1c fptrolrurti ~IeposIts.
tcazil is helping :t (incita~0ing t't?a:c':itel.a, i'oliVia, and l.c;u.a~'.or) to
-xp1ot for oil and arranging to 1arC1a a=e l;4rtiv qt antt i t it+:-. of whatever
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is discovered. All of this makes the Argentines extremely uncomfortable.
The press in Buenos Aires continually harps on the dangers of Brazilian
expansionism and makes a big point of supposed threats to Argentine
security interests, such as proposed Brazilian expeditions to Antarctica
and the planned launching of communications satellites.
7. The Argentines are also a :tremely sensitive to close tics be-
twuen Brasilia and Washington. From the vantage point of Buenos Aires,
it looks as though the US has chosen Brazil as its representative in the
Southern Ilemisphore. In this context, th'. Argentines describe the Brazi-
lia i role as "sub-imperialist". Every t ;ono a LIS official praises Brazil
for its economic growth, political stability, and favorable attitude
toward foreign investment, the Argentine -- shudder. President Medici's
triumphal trip to Washington in December 1971 was especially galling,
because it conjured up images of the US and Brazil combining; forces to
keep other Sot' h American countries in check.
8. In retaliation, the Pcronists m v talking about leading a
?,trcngtheaacd union of Spanish-American nations. They are trying to
join the Andean Pact, and are busily lobbying among its wi,hers in an
{-ffor*_ ro erect barriers against Brazilian cconmic expansion and pel:-
ti+cal in;1uc;ace. They are i ishit ., the 14-TV Ont Ole
cr mt.ric. rxj t uvrk toor.ctlhcr to withstand pres=urrs of the US-
= raz a l al l ianCe :~ta~1 tl:c;.` a: e wi3a;aine c?' ; : -
1 articaalarl'- in
-tai 1e and Pena.
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9. 'Do Poronists are also pressing for unity of the labor move-
ment in South /'unorica. Their call for a new labor central is not-. likel;r
to got very far, but it is the sort )f initiative that irritates and
worries the Brazilian military. Brhzil,'s planners know that it would
he difficult to maintain high rates of economic growth if Brazilian labor
unions became vigorous and demanding like their counterparts in Argentina.
Consequently, the Brazilian government will be anxious to coin-ter any
Argentine moves that smack of international syndicalism.
10. Argentina's relations with Chile have improved over the last
few years, in laigc part because both countries feel an urgent need to
seek allies. Chile also %las tense relations with Brazil and worries about
Brazilian intervention in its internal affairs. Argentina has consistently
extended credit to Allende' s regime, and trade between the two countries
is extensivo, despite the chaotic economic situation in Santiago. Allende
himself was the featured guest when Hector Cmnpora was sworn in as I'resi-
dent. 'T'hus, despite their ideological differences, the Argentine and
(iii lean govotwnnnts find it mutually advantageous to cooperate. Peron
is l il:.ely to develop his own close relations with Allende because he
l- r orally syrjaathizes with Allende's plight and feels thrcate eel by the
c:l onc tics between the tt5 and Brazil.
11. nc I;ra:i :1:,?r gove nwcnt 1= ..'orricd about Argentine tics with
I.c~43' t ailc and 01ba, and is rccxcupied '$tli talc subject of leftist
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countries with subversive inclinations. The Brazilians assume that
Brazilian terrorists will be able to obtain a safe haven and physical
support in Argentina, and they are worried about sabotage of the
hydroelectric complex at Itaipu. Consequently, the Brazilians are
stepping up their intelligence activities in Argentina. They also plan
to maintain contacts with those elements of the Argentine armed forces
who oppose the Peronists, expecially in the navy.
12. Outright military hostilities between the two countries
are only an outside possibility, but the governments are in the process
of reorienting and modernizing their armed forces just in case. Brazil
plans to reinforce its units in Southern Brazil, to tighten border
controls, to begin surveillance of suspicious Argentines in Brazil,
and to purchase more military equipment. Argentina has reoriented
sonic army divisions which noi"mally face the Chilean border, and is
propar-ing to increase substantially its force of M41 light tanks.
President Medici has told advisors that he is opposed to moving against
neighboring countries, but that he is in favor of more contingency
plasm i gig. As an example of Brazilian concern, Argentina has been chosen
as the simulated target of the Brazilian Navy war games for 1973. In
this atmosphere, it would not be surprising to sec periodic sabre-
ratt I ing along the borders, whether from deliberate provocations or
irgsulsivc reactions.
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13. US relations with Argentina are bound to worsen in any. case,
as the Peronist Government seizes every opportunity to emphasize. its in-
dependence in foreign affairs (e.g., its recent adhesion to the group of
non-aligned nations). Even- the Brazilians on occasion will find it
useful to take anti-US positions on issues of economic independence and
national pride. Nevertheless, the intensified rivalry between Brazil
and Argentina will complicate IT., relations with both countries and with
the region as a whole. If the US becomes. more closely identified . with
the Brazilian government, this will exacerbate the rivalry in the. southern
cone and make it easier for Argentina to pull the ;spanish-speaking . coun-
tries together. An expanded Andean Pact, determined to counterbalance
the economic and political influence of both the US and Brazil, could
cause serious problems for the US. On the other hand, any US overtures
to Peron that emphasize Argentina's leadership role in South America.
would infuriate the Brazilians, our most reliable and formidable allies
in the area.
14. The US has little leverage with which to dampen down the
quarrelsomeness of Brazil and Argentina. Both governments will be in
the market for more military equipment and would prefer to buy it in
the US, but there are plenty of potentiai sellers in Western Europe. too.
At meetings of the OAS and other international bodies, where Argentine
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and Brazilian diplomats will be competing for influence, the US will
often be caught in the middle and. be unable to acconm,todate both coun-
tries at the same time.
IS . The principal challenge for the US will be to maintain the
friendship of Brazil while keeping. Argentina. from becoming an impla-.
cable enemy of the US and a regional. leader in that direction. Perhaps
some points could be scored indirectly in the OAS framework by privately
encouraging other South American countrie3 to work to assuage the
Argentine-Brazilian rivalry, in the name of regional peace and harmony.
Such an approach would. require. a public reduction of US emphasis on
Brazil as the favored South American son.
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