MercoPress. South Atlantic News Agency

“Unprecedented crisis”

Argentine is suffering an unprecedented crisis and will end 2002 with a 16% drop in the country's Gross Domestic Product, GDP, according to the IMF report “World Economic Prospects” released during this year's annual assembly in Washington.

IMF also anticipates that Argentina runs the risk of returning to one of its historic woes: inflation, and forecasts a 29% for this year, and 48% in 2003.

The report indicates that the 2002 fall in Latinamerica's GDP is partly due to the "Argentine crisis and its contagion effects over neighbouring countries, particularly Uruguay and Paraguay".

"Argentina is experiencing an economic contraction of unprecedented historic magnitude, with an accumulated reduction of its GDP towards the end of 2002 equivalent to 20%, almost double what the country underwent during the Great Depression of the 1930's".

Argentina's crisis is "tragic and unprecedented" said Kenneth Rogoff, IMF Chief economist, but insisted the multilateral organization was involved in helping the country out of its current situation.

However the IMF report reiterates that Argentina must help itself more before financial assistance is forthcoming. "Quick progress is needed in several areas", reads the report recalling that Argentina must develop a complete strategy involving the serious financial condition of the banking system which must be applied in a transparent and homogenous way.

Other demands include a "monetary anchor sustainable with the economic program and strengthen the country's Central Bank independence".