MercoPress. South Atlantic News Agency

Looking for political support

A 41 billion US dollars international stand by support, a new orthodox Economy Minister respected by all parties as a brilliant professional and a clear determination to put the house in order by targeting a balanced budget, seems the right combination to get a country back on its feet and to begin to recover from a thirty months recession.

But without the main ingredient, political support and leadership, it's very hard to complete the picture and this has become Argentina's main frustration, and President De la Rúa's recurring nightmare since he took office fifteen months ago.

Ricardo López Murphy and his austerity plan to cut expenditure 1,9 billion US dollars in 2001 (including many Congressional perks and pensions), 2,5 billion in 2002 and 3,5 billion in 2003, has full blessings from international and local financial institutions, and the business community, openly expressed over the weekend following a speech by the new minister outlining his policies to Argentina's most important decision makers.

However the budget reductions and plans to streamline government, have split Argentina's ruling coalition, Alliance, leaving President De la Rúa with half his cabinet.

Left leaning minority partner Frepaso which abandoned ministerial posts insists the ruling Alliance still exists, although there's no certainty of Congressional support for the drastic spending cuts and tax reforms announced. President De la Rúa is also facing resistance in his own party, the Radicales, a significant portion of which feels more inclined to team up with Frepaso and the provincial governors who will be exposed to the greatest impact of federal budget savings.

This has forced President De la Rúa to look for support in the Peronist opposition or those groupings which under former president Carlos Menem imposed radical and sweeping reforms such as open market policies and privatisation of public utilities, that are anathema to hard core Frepaso and part of the Radicales, basically those led by former president Raúl Alfonsín.

But in this nerve racking situation, the Argentine political system has been warned that default and an end to international support, are round the corner unless Argentina moves forward from the current stagnant situation.

President De la Rúa is scheduled to make a speech this week in Santiago de Chile during the annual assembly of the Interamerican Development Bank, IDB, an event which convenes bankers, investors, presidents and former officials from the region. One of the outstanding figures of the gathering will also be Mr. Doming