MercoPress. South Atlantic News Agency

Breaking News from South America.

Still not good enough

Faced with a new IMF delegation that insists on fiscal and foreign exchange discipline, the Argentine government imposed export duties, ranging between 10 and 20%, on agricultural commodities exports. "Our objective is to collect an additional 1,5 billion US dollars to keep with budget targets, and help ease the pressure on local food prices", said a spokesperson for the President Eduardo Duhalde administration. Argentina after defaulting on 141 billion US dollars debt, and cut from international credit, is anxiously waiting to reach an agreement with the IMF that will give the country access to 10 billion US dollars in fresh funds. "The delay in reaching an agreement with the IMF and the drop in tax revenues has forces us to take this undesired and transitory measure", indicated Production Minister José de Mendiguren. Apparently the delay is originated in the lack of trust in Argentina's economic policies and pending promises to eliminate the fourteen different bonds printed by provincial governments circulating as parallel money and a drastic cut in the provinces budgets. The current delegation expects to deliver a paper on Argentina to the IMF annual spring assembly to be held next April 20/21st. Powerful farmers organizations that last year exported over 10 billion US dollars in cereals and oil seed complained bitterly about the new duties arguing that "they are recessive and will only make overall agricultural production drop". Farmers wrath however is minor compared to the threats Mr. Duhalde faces in the currency exchange market where the US dollar reached four pesos (after a whole decade pegged at 1 to 1) but now seems to have temporary stabilized at 2,80 pesos, and with inflation, 10% in the three months since taking office, and 25% for the basic food supply. In Washington IMF Deputy Managing Director Anne Krueger said that "we can't lend into anything that does not have the hope that Argentina can come out of it with the promise of growth?and that requires some changes". "Argentina must develop a tighter budget, a sustainable fiscal and monetary policy, a workable exchange rate system, change bankruptcy laws and lift bank restriction