MercoPress. South Atlantic News Agency

Regional reaction

Argentina's Mercosur partners expressed their solidarity with the incoming government but privately are following events closely, not only because of the effects of the moratorium in financial global markets, but since the situation is still, politically unresolved.

Brazil, Chile and Uruguay said there was not much to fear in financial or trade terms, since all three countries were not surprised by the outcome. "The risk of contagion is limited", said Brazil's Central Bank president Arminio Fraga, while Chilean Finance Minister Nicolas Eyzaguirre underlined his country's "responsible fiscal and monetary policy". However in Uruguay, former president Julio Sanguinetti forecasted a "very difficult 2002, more demanding than 2001", and in Chile a leading Senator from the ruling coalition, Adolfo Zaldivar, said events should "come as a warning to Chile". Brazilian leading newspapers also underlined the inevitability of the Argentine outcome and blamed the International Monetary Fund, IMF, for the mismanagement of the situation. The Argentine crisis is the "disastrous end to an illusion" fostered by the IMF that for many years hailed Argentina as the model to follow, and from the outset supported Mr. De la Rúa's government, writes the influential O Estado de Sao Paulo. Jornal do Brasil from Rio do Janeiro claims IMF acted cruelly in the last stages of Argentina's plight after supporting for so long an unsustainable economic policy.During the recent Mercosur summit in Montevideo, Brazilian President Fernando Cardoso allegedly invited Argentina to devalue and begin working in a common currency with Brazil. Further north in Mexico, that in the past triggered two financial crisis in Latinamerica, 1982 and 1995, compared the Argentina situation, with Turkey, "a strategic US military ally, where the US bases ensure that the financial IMF flow to Ankara will continue". But the first impacts of the Argentine situation will be felt head on, in the coming days, with the holiday season when over a million Argentines normally flood Uruguayan, Chilean and Brazilian beaches. So far reservations are almost inexistent.