MercoPress. South Atlantic News Agency

Lavagna to meet Koheler in Miami on Monday

Government deaf to G7 call for constructive talks on defaulted debt. “There will be no turning back” on 25 cents per dollar offer.

There will be no turning back, Interior Minister Anibal Fernandez told reporters in the Patagonian province of Chubut.

The President took his time to study the state of Argentinas economy and decided this is how far the country could go in repaying.

Fernandez also boasted that Argentina is abiding by the agreement reached with the International Monetary Fund in September strictly.

The debt restructuring issue is causing short circuits between the Kirchner government and the IMF as some countries are putting pressure on fund bureaucrats to lean harder on Argentina unless the country comes up with a more reasonable debt proposal.

The local stock market yesterday sunk 4.5 percent, back to the levels at which it started the year, due to growing uncertainty over the debt negotiations.

The IMF board is meeting next month for the second revision of the 12.5-billion-dollar aid agreement signed in September. The government is due to pay the IMF 3.1 billion dollars on March 9.

Economy Minister Roberto Lavagna will be flying to Miami on Monday to meet with IMF managing director Horst Kohler, the government announced yesterday. The meeting was set up by Lavagna and Kohler over the phone yesterday and is designed to muster a political framework for the second review.

On Wednesday, Kirchner dismissed rumours that he was planning to call a national referendum to ask Argentines whether they agreed with the government's debt proposal.

Observers said that the move would be part of a strategy to turn the debt renegotiation into a national cause.

Economist Miguel Kiguel yesterday described the possibility as very dangerous.

It would be a mistake to politicize the discussion, said Kiguel, because it would complicate the negotiation in the future.