Artistic rendition of Argentina's ARSAT II satellite.

[Satnews] According to a report in the Buenos Aires Herald, the government has faced a backlash after Rodrigo de Loredo, the president of the state owned Arsat telecommunications company, announced the immediate suspension of the Arsat III satellite program.

“Arsat needs to be self-funded,” de Loredo said, “because it has some good things but its finances are mismanaged. In this way, we are looking for the incorporation of collaborative groups.”

De Loredo added that the funding of the wider reach of the geo-stationary satellite Arsat II, currently in orbit and capable of providing satellite coverage to Argentina’s neighbors and thereby generating revenue, would also require funding from outside of the state project.

“We found that Arsat II had launched without having sold anything. We are now presenting the permits to sell the coverage of the satellite,” he said.

The Arsat president—the son-in-law of Communications Minister Oscar Aguad—faced criticism following the apparent cancellation of the project. De Loredo’s predecessor Matías Bianchi, who oversaw the recent successful and popular launches of the Arsat I and II satellite programs during the tenure of ex-President Cristina Fernández de Kirchner, said he was “surprised” by the announcement and questioned de Loredo’s assessment.

“Arsat II had already signed contracts for about 30 percent of its capacity (and) numerous contacts with potential customers had already been made to reach 80 percent of its capacity,” Bianchi told Radio del Plata.

He rejected the claims of “mismanagement,” stating that the previous administration had left the ARSAT programme on budget and on course for self-funding, and warning about the introduction of private investment to the project.

“We left a business plan and a balance certified by the external auditor in October, operating profits. ARSAT was on its way to economic independence ... It is possible that the vision of a company that cannot compete with private firms won’t compete at all. It’s a self-fulfilling prophecy. If it cannot compete with the private sector, ARSAT will not be able to self-finance,” he said.