MercoPress. South Atlantic News Agency

Opposition candidate pledges to respect Argentina's debts and rejects defaulting

Many fear Fernandez might halt repayment of a US$ 56 billion IMF credit line, repeating the default prompted by Argentina's worst economic crisis in 2001-2002.

Argentine presidential candidate Alberto Fernández said on Thursday that no one wants a default for the country and he's ruling it out if elected. The center-left candidate appeared to be trying to calm investors who reacted to his strong finish against conservative President Mauricio Macri in an initial round of voting by battering Argentina's stocks and currency.

Many fear he might halt repayment of a US$ 56 billion credit line from the International Monetary Fund, repeating the sort of default prompted by Argentina's worst economic crisis in 2001-2002.

But Fernández said at a candidates' forum that “nobody can seriously propose” a default because “it is a debt contracted two years ago by a democratically elected government.”

Fernández said a default “is a solution that sets us back” and said it's “an error” to raise the issue. He said that if elected, he would maintain a “cordial, kind and respectful” relationship with U.S. President Donald Trump, who has a personal relationship with Macri dating back years from their days as businessmen.

Recession-hit Argentina is heading for a jittery run-up to the elections on Oct. 27.

Fernández and his unrelated running mate, former President Cristina Fernández, topped Macri by 16 percentage points in a sort of primary vote on Aug. 11 — a margin large enough to suggest they might win a first- round victory in the general election.

Macri's loss, and fears of a potential return to interventionist policies by a leftist administration, hit markets, crashed the peso currency and sent stocks and bonds tumbling.

Speaking at the same forum, Macri attributed the loss to an “angry vote” by many Argentines who have continued to lose purchasing power to a high inflation and a weak currency while poverty rises. He said that the results of the primaries were a “sucker punch.”

“First, I need to pick up the glove after this blow because before being a president, I'm a person, and clearly, the result was a battering,” Macri said at the forum organized by the newspaper Clarin.

Macri also said that IMF officials will visit Argentina next week to track the country's commitments on its loan deal and he asked his leftist rivals to offer detailed economic plans to calm investors and help dispel uncertainty.