Argentine officials, in what has become a most Sisyphean task, are finalizing new economic measures they hope will impress a negotiating team from the International Monetary Fund, which landed in Buenos Aires Monday for a new round of negotiations.
At the top of the list for President Eduardo Duhalde and his economic team was an increase and expansion of tough taxes on exports, a sector that Duhalde has targeted since the freely floated peso improved their lot by making Argentine products cheaper and more competitive abroad.
Two Argentine dailies reported Monday that the new taxes on exports could be announced as early as Monday evening, although a government spokesman denied that any announcement is imminent.
Duhalde huddled Monday with his Economy Minister Jorge Remes Lenicov among other top officials to iron out details on the taxes and other issues to be presented in Tuesday's opening meeting of a two-week trip for the IMF team. Argentina is seeking upwards of $25 billion in fresh aid.
The Buenos Aires daily La Nacion reported on its Web site Monday that the tax increases will target the robust agriculture sector, with an increase to 20 percent on most farm products. Manufactured goods would see a tax of 10 percent, while higher-end value-added products would be taxed at 5 percent.
Trying not wholly to commit political suicide, Duhalde is expected to lift export taxes on specific items, such as honey and lemons, which are the essential source of income to small, specific regions of the country.
In response to last week's reports of a new peg for the peso, which was unhinged from its 10-year anchor to the dollar in January, Duhalde reiterated that no such idea is being considered. The IMF has been insistent on the peso remaining floated.
Which is a difficult political pill for Duhalde to swallow. A report over the weekend indicated that despite low internal demand -- consumer sales were about half of what they were a year ago -- prices for goods across the spectrum are rising. And those very
Argentine protesters who originally sent President Fernando de la Rua packing in December after deadly clashes with police can be counted on to take to the streets again, especially if prices continue to rise as the peso's value plummets.
"Everyone has an opinion, everyone thinks that it is easy (to lead the country out of recession)," Duhalde noted in a radio address this weekend. "But when the 'gong' sounds, I am left alone, alone with the crisis." To which IMF officials might reply á la John
Donne: "Never send to know for whom the bells tolls, Mr. President, it tolls for thee."
And some politicians are beginning to ring Duhalde's bell a bit on the measures he is looking to implement to appease the IMF.
Nestor Kirchner, the Peronist governor of Argentina's Santa Cruz province, echoed a familiar sentiment in Argentina that the IMF will only deliver funds to help out internationals hurt by the country's downfall.
"I think that the Fund, when it arrives at an agreement with Argentina, will send money to pay off international commitments. We aren't waiting for the arrival of funds to put into place a productive structure," Kirchner said Monday.
Former President Carlos Menem, whose economic policies of the early 1990s, such as the peso-to-dollar peg, many blame for the country's mess, was also quick to criticize his longtime rival and fellow Peronist Party member, Duhalde.
"He has no economic plan," Menem, sure to run for president again, graciously suggested of Duhalde on a local radio show. As a consequence of that, Menem opined, "Argentina is stagnant and is going downward." Nearly as sharp an analysis as noting that the word default begins with the letter "d."
But in a sign that Duhalde is getting some local and provincial politicians into line, reports Monday indicate that city workers in Buenos Aires will be paid in pesos beginning next month. Cash-strapped city and provincial governments have been forced in this economic crisis to issue bonds as salary in lieu of cash they didn't have. The IMF, seeking out transparency in Argentina's economic situation where it can get it, has insisted that optimally these bond payments be halted, and that a program be put into place whereby the bonds can be traded in for pesos.
Duhalde also worked Monday on advancing a social program that will target 1.2 million Argentines by offering a monthly salary of 150 pesos for four hours of work a day.
