Argentina: President Optimistic Despite IMF Loan Conditions

Publisher Name: 
Associated Press

BUENOS AIRES -- Argentina's president, having just
secured $8 billion in emergency aid from the International Monetary Fund,
announced plans for a referendum this year on cost-cutting moves aimed at
fighting a recession.

In a televised address late Wednesday, President Fernando De la Rua told
this South American nation of 36 million that the referendum would reduce
the ''political costs'' of spending cuts and reforming social security and
state-run health care agencies.

De la Rua said he wanted to hold the plebiscite after Argentina's October
congressional elections, which are viewed as a major test for his
administration's longevity.

''The moment has come for a transformation of our system, and the people are
demanding reforms at once,'' he said.

''There are no miracle cures, nor magical solutions,'' said De la Rua,
whose governmental belt-tightening moves have sparked near-daily protests,
crippling national strikes and highway blockades by the unemployed.

Argentina is suffering from a severe economic downturn that began in 1998.
The country's unemployment rate has soared to 16 percent. Meanwhile, the
$130 billion public debt has embroiled the president in a monthslong
crisis.

''We have to spend less, collect more and fight against tax evasion,'' De
la Rua said in the address.

He vowed to curb further government spending, but said he wanted the
country's backing for attempts to reform the social security and national
health programs - both of which have been criticized as inefficient.

The president also said the government would revamp the Argentine customs
and federal revenue office, both key components in tax collection.

The IMF announced Tuesday it would add $8 billion in loans to the $14
billion currently available to Argentina.

AMP Section Name:World Financial Institutions
  • 194 World Financial Institutions