MercoPress. South Atlantic News Agency

Argentina thanks Uruguay.

In a brief 24 hours visit to neighboring Uruguay, Argentine caretaker president Eduardo Duhalde who will be leaving office next May 25, thanked the Uruguayan government for all the support given to Argentina, “when we were a step away from the abyss”. Mr. Duhalde also admitted that the Argentine crisis had a negative influence for the Uruguayan economy, but now the “positive ripples” from Argentina will reflect in Uruguay.

"Thanks to God and the efforts of the Argentine people we're effectively recovering", said Mr. Duhalde adding that in the same way that "our blunders and difficulties could have harmed this beloved people, I believe that from now on a wave of positive ripples will be coming".

In a joint press conference with Uruguayan president Jorge Batlle in Montevideo, Mr. Duhalde said that this was his "last State visit" as president of Argentina and his main purpose to thank the Uruguayan government for its support in the early days of his interim mandate began in January 2002, "when Argentina seemed hopelessly condemned to failure, when people talked of national dissolution, when Pope John Paul remarked that civil war was imminent, when Argentina was a step away from the abyss".

President Batlle pointed out that when "Argentina grows and improves, Uruguay benefits", with a similar relation when Argentina "undergoes difficulties". The Uruguayan president also remarked that in spite of the political division between Uruguay and Argentina, "for centuries both countries, have had a common destiny".

In late 2001 and early 2002, the Argentine economy collapsed, the country defaulted 128 billion US dollars in foreign debt, and panicked Argentine depositors crossed to neighboring Uruguay to collect their savings and deposits. As a consequence the Uruguayan banking system, traditionally a haven for Argentines, suffered a gigantic run and in August 2002 Uruguayan officials declared a bank holiday and froze foreign currency deposits in government banks. In the meantime Uruguay lost half its bank deposits and the economy suffered a contraction equivalent to over 20% of GDP.

In the second half of last year with massive financial help from the United States Treasury Uruguay managed to overcome the confidence crisis and in 2003 began a "voluntary" reprogramming of its sovereign bonds with debtors, 5,3 billion US dollars, currently in process.

Mr. Duhalde was particularly critical of what he defined as the "liberal or ultra liberal" economic policies that condemned Argentine society to poverty, misery, social exclusion and inequality.

"Production and work are the only means to recover an economy and get a country back on the rails, be it with great or minimal government intervention. Britain, Germany, France after the Second World War are all examples of different economic thinking but they had one thing in common, production, production and more production and jobs", indicated Mr. Duhalde who described the current globalization process as inevitable, but "not necessarily the open market policies".

"That's a lot of nonsense, rich countries have two sets of rules, one for us and one for them; they can nurture their markets, we simply have to open them; that's over in Argentina, we request and demand reciprocity".

"We, the bread basket of the world had our supermarkets and stores flooded with agricultural produce from Europe, United States and Asia, and we have limited access to their markets, that's Liberal nonsense, a stupidity. Of course they congratulated us, because that's what they wanted and suited their interests".

Mr. Duhalde further on argued that without domestic markets, no economy works, and "I'm pleased to announce that Argentina has already managed to substitute 40% of consumer imports, which means Argentine production, jobs and money for Argentine workers and businessmen, and may I insist not with protection but with increase Argentine competitiveness".

Mr. Duhalde said he favored the best of relations with United States even when considering that the "Washington consensus" of open markets that was launched in the late eighties, is "finished and over".

Regarding foreign debt Mr. Duhalde admitted that the damage caused to Argentina' international standing when Congress (in December 2001) approved while singing the national anthem, a 128 billion US dollars default was dramatic and catastrophic.

"I believe that as with any common citizen that can't pay his debts, he can request a reprogramming, rescheduling, rolling over, but the face value of a bond is the face value and must be repaid: if it says 100, 100 must be honored and returned".

While in Montevideo addressing the Uruguayan National Assembly, outgoing president Duhalde was informed by one of his aides that former President Carlos Menem had stepped down from the presidential run off, and immediately broke the news to the legislators.

"We have an elected president", announced solemnly Mr. Duhalde adding, "Menem has let down public opinion, those who voted for him and the image of Argentina in the world".

"Everyone knows he didn't participate because he feared the most catastrophic of defeats ever. Former president Menem never respected institutions", emphasized the outgoing Argentine president and Mr. Menem's most despised political enemy