Domestic and Global Pressure Increases Against Argentine President Cristina Kirchner

Sep 17, 2012, 09:00 ET from American Task Force Argentina

Paris Club and IMF Dismayed with Argentina, Canada and Italy Vote Against New IADB Credits for Argentina, and Large Anti-Cristina Protests Undermine Kirchner Administration's Image

WASHINGTON, Sept. 17, 2012 /PRNewswire-USNewswire/ -- On the heels of anti-Kirchner protests across Argentina, ATFA commends leadership against Argentina at international financial institutions and highlights mounting criticisms over President Kirchner's policies, as indicated by recent events:

  • The International Monetary Fund is expected to issue a very strong report against Argentina on Monday (La Nacion);
  • Canada and Italy have joined the US in voting against IADB credits for Argentina (La Nacion);
  • The Paris Club is upset with Argentina and Nicola Stock, leader of Task Force Argentina (Italy), calls for Argentina to be ejected from the G-20 (Clarin); and
  • Massive anti-Cristina protests have mounted across Argentina as she moves closer to changing constitution to run again (various reports).

"The rising international condemnation of Argentina and the new civil unrest are a wakeup call to the Kirchner Administration that her economic mismanagement, distortions of national economic data and disregard for the international rule of law have worn thin," explained ATFA co-chair Robert Shapiro.  "ATFA and the United States Government have reproached Argentina on its failure to makes any in a variety of matters, including its refusal to pay outstanding final World Bank ICSID awards and lack of engagement with its creditors and international institutions.  We urge President Kirchner to honor her outstanding obligations and normalize relations with her country's U.S. creditors and with the international community."

Argentina defaulted on a record $80 billion of sovereign debt in 2001 and repudiated the debts owed to many foreign creditors, and the world considers the country to still be in default.  As Argentina has persistently refused to pay both its outstanding private creditors, including $5 billion owed to U.S. lenders, and more than $9 billion owed to member nations of the Paris Club, it has been effectively barred from raising new funds in international capital markets. 

In response to Argentina's unmet promises to repay its international creditors, Nicola Stock, representative of Italian bond holders, demanded at the Paris Club meeting this past week that "Argentina should be kicked out the G-20."

This discontent with Kirchner's policies was echoed at the Inter-American Development Bank by the governments of Canada, the U.S., Spain and Italy, which all opposed a new package of US $700 million in loans to Argentina this week.  Since September 2011, the U.S. has opposed all future lending to Argentina by the IDB and World Bank, with the exception of loans for programs targeting the very poor.

Argentina also faces very strong criticism at the IMF for its failure to participate in the periodic economic reviews that every other country does, or to correct false official statistics on inflation and economic growth.  The IMF will decide on Monday whether to implement a "measure of censure," a tool that is rarely used and which would open the door to more serious sanctions.

The international community realizes the Argentine people deserve better.  "Every day the Kirchner Administration refuses to abide by international law and repay lenders adds more hardships to the everyday life of Argentine citizens," ATFA Co-chair Nancy Soderberg said.  "President Kirchner is wrong to tell the people of Argentina that 6 pesos, $1.30, is enough to buy a day's food.  The time is now to take bold steps to demand an end to this Administration's unacceptable policies." 

About the American Task Force Argentina

The American Task Force Argentina (ATFA) is an alliance of organizations united for a just and fair reconciliation of the Argentine government's 2001 debt default and subsequent restructuring. Our members work with lawmakers, the media, and other interested parties to encourage the United States government to vigorously pursue a negotiated settlement with the Argentine government in the interests of American stakeholders.

SOURCE American Task Force Argentina