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Bush offers little help to Argentina on IMF talks

November 4, 2005

By Tabassum Zakaria

MAR DEL PLATA, Argentina (Reuters) – The United States on
Friday offered little help to Argentina in its quest for
more-flexible terms from the International Monetary Fund, as
they prepare for talks on a new economic program.

U.S. President George W. Bush said Argentina was in a
stronger position than when it earlier relied on U.S. help with
the international lender, and a State Department official said
Argentina had a sufficient record of economic improvements to
make its own case to the IMF after a financial collapse in
2001-2002.

Bush said after meeting with Argentine President Nestor
Kirchner that Kirchner told him he wished the IMF had a
different outlook toward Argentina and its economy. But Bush
appeared to suggest that the United States — the IMF’s biggest
and most powerful shareholder — would not wield its influence
in any discussions.

“I was pleased that the United States was helpful during
the early part of his (Kirchner’s) term with the IMF, and I
suggested that his record is such now that he can take his case
to the IMF with a, with a much stronger hand,” Bush said.

Argentine media had reported before the meeting that
Kirchner would ask Bush to wield his influence with IMF to
obtain the best terms for Argentina.

Argentina has been pushing for the IMF to take a more
flexible position on issues such as taxes, debt, interest rates
and exchange rates as they prepare for formal talks on a new
IMF-backed economic program.

Argentina suspended negotiations with the IMF more than a
year ago to focus on restructuring $100 billion in defaulted
debt with private creditors, but has said it is ready to
restart talks. No schedule for new talks has been released.

Tom Shannon, assistant secretary for the Western Hemisphere
at the U.S. State Department, told reporters at the summit that
Argentina’s record could stand on its own.

“Argentina really doesn’t need our help in this regard
because it has the success story that it needs to take into
these kinds of negotiations,” Shannon said.

Kirchner, who took power long after the crisis, is a fierce
critic of the IMF in tensions that date back to a meltdown
triggered by the government’s free-spending ways that
eventually drove the country to economic collapse.

“He (Kirchner) has been an outspoken person for reform. I
listened very carefully to his point of view,” said Bush, who

was in Argentina attending the 34-nation Summit of the
Americas.

Kirchner believes that as Argentina moves forward, the IMF
“should be a less-intrusive partner in terms of creating
conditionalities for official IMF assistance,” Shannon said.

He said it was in the interest of the United States that
Argentina do well, “because a stable, democratic, prosperous
Argentina is an important anchor in a region that faces a lot
of trouble at this time.”

Bush on Friday conducted a round of diplomacy on the
fringes of the summit. He held a morning session with leaders
of Central American countries that signed a free-trade
agreement, and later held joint talks with leaders of Colombia,
Bolivia, Peru and Ecuador.


Source: reuters



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