MercoPress. South Atlantic News Agency

Tough decisions still to come

Interim Argentine president Adolfo Rodríguez Saa confirmed his administration is working in the creation of a new currency which will help finance the million jobs he promised on taking office, and that will thrust the country out of the four years recession and record unemployment.

The "argentino", the new legal tender, will be backed with all state assets including prime property such as Government House ("Casa Rosada") and even Congress building , announced president Rodríguez Saa during an open meeting with militant trade union leaders, who helped with the downfall of previous elected president Fernando De la Rúa. Although there has been strong pressure (both local and international) to either devalue the peso or dollarize all currency and deposits, president Rodriguez Saa dismissed both arguing that a devaluation would condemn millions of Argentines who have debts in dollars, and changing the local currency for the US dollar would benefit very few. However his Finance Minister Rodolfo Frigeri under strong questioning admitted that the "argentino" is planned to phase out gradually the current system which has the peso pegged to the US dollar. Argentina would then have a "tri-monetary" system. Last weekend Argentina's new government announced it was suspending payments of its monumental (non payable) debt of 132 billion US dollars, the greatest default in history. So far the new president is winning the mediatic exposure, holding well publicised meetings with union and political leaders, industrialists, farmers, church hierarchy, groups of jobless and even human rights organizations to whom he has promised his government will not prevent foreign extradition of alleged violators. However locally, deposits continue frozen, only salaries and pensions can be withdrawn from banks, the 30 days future US dollar is selling at 1,55, (that is 55% devaluation), retailers are said to be increasing prices an average 20%, and some representative personalities are expected in the coming hours. Uruguayan president Jorge Batlle will be arriving in Buenos Aires this Thursday to meet Rodríguez Saa and give his government's support. However Mr. Batlle will also carry a personal message from the International Monetary Fund Secretary General, with which the new Argentine administration must begin immediate talks. Uruguay will also formally hand over the six months rotating Mercosur chair to Argentina, an event that should have taken place a week ago in Montevideo but was marred by th