MercoPress. South Atlantic News Agency

Argentina’s big business warms up to CFK: confrontation is ‘pointless’

Adelmo Gabbi president of Buenos Aires stock market said G6 wants a four-year ‘truce’

Big business in Argentina agreed to prolong the current ‘truce’ with the government of President Cristina Fernandez but called for more investment and improved competitiveness with more accessible financing, besides a return to the international voluntary credit market and an agreement with the Club of Paris.

The so called G6, the group which brings together the country’s main sectors of the economy met for the fist time this week since the landslide victory or President Cristina Fernandez in the August 14 Primary and agreed that is was ‘pointless’ to have a confrontation and opted for a continued ‘truce’ which they hope will last for four years.

“We talked mainly about the August 14 primary and its implications. It is plain clear that the Argentine society voted for the model and what we must see is how we can contribute to improve that model”, said Adelmo Gabbi president of Buenos Aires stock market.

“We need more investment, improved competitiveness with better financing conditions. It is essential for Argentina to return the global voluntary credit markets and an agreement with the Club of Paris of sovereign creditors” added Gabbi.

“If I was the government I would collect all the economic data, which is very good, submit it to the Article IV IMF review because we need to get back to the money markets and stop being considered a ‘frontier country’. We must try our best, Argentina must go ahead and we must all contribute”.

Argentina’s big business also praised the new dialogue with the administration particularly through Economy minister Amado Boudou, who has proven an ‘effective’ link, and even “Mrs Kirchner who at least lately and with some of G6 members has reopened bridges to the presidential residence of Olivos”.

“It is evident we must change our style and approach, we have four tough years ahead and we can’t spend them in permanent confrontation”, said one or the participants at the G6 meeting which worked on the hypothesis of a clear victory for Cristina Fernandez re-election bid next October.

G6 agreed to the creation of task groups in each sector of the group which will elaborate and later take the results to the government. “We must not confront but rather join the main current”, said Carlos De la Vega president of the Argentine Chamber of Commerce.

It was also agreed to send a delegation of business representatives to the round of consultations of the Financial Action Task Force (referred to money laundering) before a qualification of Argentina on the matter is issued next October.

The Argentine business community fears that a non positive rating from FATF will have an impact on the country’s international standing.

Gabbi admitted that the Argentine stock exchange only trades an average of 5 million dollars daily and this is because “we have been unable to generate and manage trust. We must create confidence”.

Likewise, why capital flight from Argentina? “Very simple, it’s an Argentine addiction”, said Gabbi who showed latest data from the Federal Reserve indicating that the main per capita holders of dollars outside the US are Argentines with 1.300 dollars followed by Russians with 550 and Chinese with 390.