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Bush offers little help to Argentina on IMF talks

Posted on: Friday, 4 November 2005, 14:28 CST

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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