Argentine crisis: Part 2

During the weekend, the Government headed by President Duhalde evaluated a number of measures to avoid a furious increasing of the US Dollar value. However, the new normative proved to be ineffective, as Monday morning thousand of Argentinians crowded the financial districts of the main cities hunting for Dollars, no matter the price.

The slump of the local currency is pushing retail prices up, and some analysts are warning on a certain haywire of the inflation ratio. It is discounted that an hyperinflationary process will outbreak a new social crisis of uncertain consequences, but surely more violent than the episodes registered in December last year.

Notwithstanding, President Duhalde showed no worrying on a possible slump of the local currency, followed by an outrageous increasing in prices. In addition, analysts estimate country’s economy to drop down at least 8.0 % during 2002, and unemployment ratio to reach records of 25% by the end of the year.

Meanwhile, sources in the National Parliament expressed to this correspondent that the Economy Minister has in office an alternative plan, in case financial aid from the IMF does not come. It will consist of a return to a fixed exchange ratio, probably the figure will be in the region of 5 pesos per Dollar, as an attempt to stop the haywire of the foreign currency. This would mean, a new Convertibility plan, very similar to the previous one masterminded by former Minister Domingo Cavallo, now in trial for fraud on public accounts.

Hernan Etchaleco PRAVDA.Ru Argentina