MercoPress. South Atlantic News Agency

Cristina Fernandez admits “the model has distortions which must be corrected”

Let’s hope God will show the light to the US and EU, said the Argentine president

Argentine President Cristina Fernandez promised on Monday to continue defending with ‘tooth and nails’ the powerful wheel of domestic consumption that has boosted the current economic model but also admitted the existence of ‘distortions which must be corrected’.

Her strong statements before auto workers at a Ford motor manufacturing plant follow recent cuts in the many subsidies that the Argentine treasury finances and which some experts anticipate will hinder the purchasing power of middle and upper class consumers who will have to pay dearer for basic services such as electricity and natural gas.

But the Argentine president also admitted that the current economic model implemented for several years now “suffers distortions that must be corrected and re-directed to ensure growth possibilities for the domestic market and sustain the aggregate demand”.

“We know that one of the keys of success is for the most vulnerable sectors of the economy to have access to basic services because since they don’t have a savings capacity, all they make, they consume, and thus they help to keep the strong activity of the economy. And if you don’t believe me ask the Chinese how they do it and there you will find the clue of what I’m saying”, said Cristina Fernandez.

The Argentine president pointed out that the G20, to which Argentina belongs, has finally started to understand the need to have ‘strong domestic markets’ to ensure a prosperous economy.

In moments of crisis, what is needed to sustain growth, aggregate demand and have people consume, “taking from those who have less to continue giving to those who have most is a mechanism that has long ceased to function any where in the world”.

She later talked about the current economic problems affecting Europe and the United States, and said she hopes “God will show them the light, so they can find a quick solution to their crises.”

“We don’t live in Disneyworld, but fortunately our situation is far from what we can see is happening in other countries. I don’t mean as a way to find solace, but simply to appreciate what we have,” she said.

Following on what has been her speech since winning by a landslide, Cristina Fernandez again emphasized on business leaders and union heads “to be responsible when it comes to special interests, considering the world we’re living in”.