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Judge reinstates Argentina central bank chief

Martin Redrado and Cristina Fernandez de Kirchner (12 March 2008)
Mrs Fernandez de Kirchner said Mr Redrado had "failed to fulfil his duties"

A judge has ordered the reinstatement of Argentina's central bank governor and blocked the president's plan to use currency reserves to pay public debt.

The court said Cristina Fernandez de Kirchner's emergency decree on Thursday dismissing Martin Redrado should be suspended until Congress voted on it.

In an earlier decision, it ruled the government could not move $6.6bn from the central bank to a special fund.

Mr Redrado angered the president after he refused to transfer the reserves.

He had said he would wait for Congress to ratify the measure when its recess ended in March.

Argentina has $13bn of international debt that matures this year, and a hole in its budget of between $2bn and $7bn.

'Fat profits'

In two rulings on Friday, judge Maria Jose Sarmiento thwarted the president's efforts to use Argentina's foreign currency reserves to pay down the country's debt and her decision to sack Mr Redrado.

I am returning to work at the bank. Justice has been done
Martin Redrado
Argentina Central Bank governor

"The judge decided to temporarily suspend the emergency decree which had led to the dismissal of this official," the Justice Department said.

In her decree, Mrs Fernandez de Kirchner said Mr Redrado had "failed to fulfil the duties of a public servant", and urged prosecutors to take unspecified legal action.

But Judge Sarmiento agreed with opposition politicians and Mr Redrado's lawyers, who said the president did not have the authority.

Under the bank's charter, the government can dismiss a member of its board, but must have a recommendation from a special congressional committee.

Moments after the rulings, Mr Redrado arrived at his office in Buenos Aires, waving at television cameras.

"I am returning to work at the bank. Justice has been done," he said.

But Interior Minister Florencio Randazzo said the government would appeal, telling Radio 10 that the constitution clearly gave it the right to issue the emergency decrees concerning the bank.

Mrs Fernandez de Kirchner also defended her attempt to use the bank's reserves to service debts, saying it would keep Argentina from paying "fat profits" to speculators who charged high interest rates.

"It's much better to use the reserves than to borrow at interest rates of 15% or 14%, when the reserves are barely earning 0.5% or 1%."



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SEE ALSO
Argentine bank chief steps down
08 Jan 10 |  Americas
Argentine bank boss asked to quit
06 Jan 10 |  Business
Argentina launches new debt deal
23 Oct 09 |  Business
Country profile: Argentina
29 May 12 |  Country profiles
Argentina to pay back $6.7bn debt
03 Sep 08 |  Business



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