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ARGENTINA | 27-10-2020 00:20

Fernández de Kirchner calls for political pact to end Argentina’s currency woes

Vice-President Cristina Fernández de Kirchner called Tuesday for a grand political agreement to resolve Argentina’s mounting currency crisis, a move that was mostly met with incredulity among the opposition.

Vice-President Cristina Fernández de Kirchner called Tuesday for a grand political agreement to resolve Argentina’s mounting currency crisis. 

In a rare public statement issued Monday touching on a number of subjects, Fernández de Kirchner said that Argentina’s “bimonetary economy” – in which the public earns and spends in pesos, but saves and imports in US dollars – is unsustainable and must be fixed once and for all.

The former president, who led Argentina from 2007 to 2015, called for the nation’s politicians to work together to resolve the problem, a suggestion that prompted incredulity from the opposition.

"The problem of the bimonetary economy, which is, without a doubt, the most serious that our country has, it is impossible to solve without an agreement that encompasses all the political, economic, media and social sectors of the Argentine Republic," said Fernández de Kirchner in a post on her website. "Whether we like it or not, that is reality and with it you can do anything but ignore it."

"Bimonetary politics is not an ideological problem: it is neither left nor right," she declared in her missive, which was divided into three parts.

The background to the vice-president’s comments is continued speculation about a potential devaluation of the peso. Government leaders, including President Alberto Fernández and Economy Minister Martín Guzmán, repeatedly denied the rumours last week.

As of Monday night, Argentina's unofficial black market exchange rate – the so-called ‘dolár blue’ – stood at 190 pesos per greenback, more than double the official exchange rate, which is subject to strict currency controls. 

In her text, the former president defended currency controls that were implemented during her time in office, before going on to describe the current devaluation chatter as “extortion." Argentina’s financial instability must be solved once and for all, she argued.

"Can anyone seriously think that a country's economy can function normally like that?" she asked rhetorically. "Argentina is the only country with a bimonetary economy."

Figures from the opposition Juntos por el Cambio coalition mocked the idea that the vice-president, a fierce critic of the Mauricio Macri administration that succeeded her in office, had the right to speak of political leaders working together.

"Dialogue is welcome if based on respect, and in the letter, it criticises businessmen and the previous government before calling for an agreement," PRO party leader and former security minister Patricia Bullrich told La Nación.

Former presidential candidate and outspoken economist José Luis Espert dismissed the letter as "ignorant," saying he considered the proposals "very ridiculous."

"If we need a multi-sectoral agreement to control the dollar, manage the country and carry out the reforms that must be made to end [Argentina's] decline, then we need a supranational force to govern us. The dollar issue should be a small thing," he said in an interview with La Nación's TV station.

Defending the president

Fernández de Kirchner penned the open letter to mark the 10th anniversary of her late husband’s death, former president Néstor Kirchner. In it she fiercely defended the current postholder, Alberto Fernández, who won Argentina’s election a year ago largely thanks to her backing and the support of her loyal voter base.

Nevertheless, she did not refrain from hinting at her unhappiness at sectors of the government he leads, expressing dismay at "funcionarios y funcionarias que no funcionan" ("functionaries who do not function").

Some analysts speculated that that phrase was a possible ultimatum, amid rumours of tensions between the Frente de Todos coalition’s Kirchnerite wing and other government officials, especially over foreign and economic policy.

Critics have blasted Fernández this year for some populist decisions that revive memories of Fernández de Kirchner’s leadership, raising questions about who is making top decisions.

The former president then went on to dismiss the speculation that the head of state was a “puppet” and that she was really running the show. 

"As they have run out of the excuses, they had to move on to a second script: 'Alberto does not govern,' 'The one who decides everything is Cristina,’” she wrote. 

“The story of the "puppet President" was used with Néstor regarding Duhalde, with me regarding Néstor and now with Alberto regarding me.

"In Argentina, the one who decides is the president. You may or may not like what he decides, but the one who decides is him.”

The former president also criticised business leaders for “mistreating” the president, citing those who had criticised the president at the recent IDEA Colloquium.

 "The climax of this permanent and systematic mistreatment occurred a few days ago at a famous business meeting calling itself a place of ideas, at which while the president of the nation was speaking,” she wrote, accusing the businessmen of “attacking him simultaneously.”

Speaking on Tuesday, President Fernández said he liked the letter and felt it was "an endorsement" of his administration.

"I read the letter and I liked it, I took it as an endorsement. It is very generous in many concepts and I value it. It has praiseworthy, generous and affectionate concepts," he said.

– TIMES/NA/BLOOMBERG

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