MercoPress. South Atlantic News Agency

Opposition is born.

Promising a “constructive opposition”, Mr. Ricardo López Murphy who has emerged as the most important non Peronist figure in current Argentine politics, took advantage of the political vacuum created by Mr. Menem's long meditated decision to step down from the presidential run off and was extremely critical of the former president and caretaker president Eduardo Duhalde.

"Let's make this quiet clear we're not going to be tricked again. They've done terrible damage to the Republic and once again they are working out a deal, yes they are both to blame, Menem and Duhalde", blasted Mr. López Murphy leader of the recently created Federal Movement Recreate who was a close third in the April 27 presidential round.

"They are both to blame. Argentina is shocked. Mr. Menem's stepping down from the second round is a collection of all possible negative political signals. The episodes surrounding the resignation of the vicepresident (Carlos Alvarez); two presidents (De la Rúa and Adolfo Rodríguez Sáa), and again the transfer to the electorate of those problems they (Menem and Duhalde) are incapable of negotiating, has taken us to the edge of another possible institutional rupture", stressed Mr. López Murphy.

"The former president and the current president have subordinated the interests of the Nation to their deep political rivalry. Today they are giving us a demonstration of their total lack of respect for the Argentine society".

"It is essential to launch a line of thinking that will help contain the anguish of millions of Argentines and channel those moral values without which Argentina will never be able to find the road to progress".

"Institutions must be protected and must stand up to these follies. The Federal Movement Recreate will give public opinion evidence of a constructive opposition", ended Mr. López Murphy who is a renowned economist and international consultant.

On ending the second mandate of Mr. Menem, in December 1999 the Alliance took office with Mr. Fernando De la Rúa as president. However following internal dissent and claims of corruption in Congress, vicepresident Carlos Alvarez resigned and in December 2001 the De la Rúa administration completely collapsed.

The General Assembly nominated San Luis governor Adolfo Rodríguez Sáa president but a few days later he also stepped down and finally in January 2002, caretaker president Eduardo Duhalde was elected by Congress.

Some of the tasks ahead

Even when Mr. Roberto Lavagna the successful Economy Minister who managed to bring Argentina from the brink of complete disaster has been confirmed on the job of an elected president Nestor Kirchner cabinet, sending a message of continuity to investors, tough decisions must be addressed in the coming months.

Argentina defaulted on 128 billion US dollars of foreign debt in January 2002 and still has to reach an agreement with debtors. The exchange rate (US dollar) has to consolidate at an attractive level for the current export oriented economy to keep growing. Privatized public utility rates must be adjusted and an estimated hike of 10/15% has been planned. Finally social security and fiscal reforms are in the agenda as part of a future long term agreement with the International Monetary Fund.

A transitory IMF agreement rolling over repayments actually ends next August.

In less than a year Mr. Lavagna has managed to stop the Argentine economy from contracting and is expected to expand this year 4%, putting an end to the recession that began in 1998.

However in that time the peso system pegged to the US dollar was shattered, over half the Argentine population is under the poverty line and unemployment above 20% in spite of the "Head of family" program that extends aid to one and a half million homes.

Mr. Lavagna also managed a precarious truce with IMF officials who were distrustful of Argentina's promises, given previous experiences, and even predicted an apocalyptic scenario with hyperinflation and social disruption. Time proved Mr. Lavagna's positive forecast correct and the IMF had to admit changes.

With the oncoming presidential election, now over with the nomination of Mr. Kirchner, many of these delayed decisions now have to be fully addressed.

Mr. Lavagna has proved an able financial storm manager, but a strong political support will be even more crucial to convince a battered Argentine public opinion, still suspicious of its ruling political system.

Fresh events are a good example of this.