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Thursday, 12 December, 2002, 22:17 GMT
Argentina pleads for help
Soup kitchen
Poverty is rife in the crisis hit country
Argentina has urged the International Monetary Fund (IMF) to speed up aid negotiations to make it easier for the country to avoid defaulting on its debt repayments yet again.

"If the IMF would facilitate an accord, Argentina could move more quickly to cancel its debts with multinational credit organisations," said Cabinet Chief Alfred Atanasof.

If the Fund fails to do so, "the talks are going to get more complicated", he warned.

Argentina is facing a debt repayment deadline on Saturday: By then, it has to have raised $726m to make a payment on a lone to the World Bank.

By Thursday afternoon local time, the situation looked bleak.

"It will not be paid because we have not been able to reach an aid agreement with the International Monetary Fund," said Armando Torres, an Economy Ministry spokesman.

Dependence

The World Bank has become Argentina's only source of income from abroad after foreign investors have taken several steps back following last year's default on debts owed to them.

This has contributed to a cash crunch which has made it extremely tough for President Eduardo Duhalde to push ahead with social programs.

Mr Duhalde has responded by refusing to eat into his country's pressured reserves to make debt repayments, insisting the cash is required at home.

More than half the country's 36 million people are living in poverty, and hunger has become a serious problem.

Massive default

From the IMF's point of view, such reluctance to play ball with international lenders has made it tricky to resume emergency aid.

A year ago, the IMF pulled the plug on its lending to Argentina, in effect forcing the government to default on its foreign debt repayments.

At the time, Argentina failed to make a repayment on $95bn of its $141bn in foreign debt.

An economic crisis followed which caused the link between the country's currency, the peso, and the US dollar to collapse.

Human suffering was widespread too and deadly riots resulted as desperate people took to the street.


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10 Dec 02 | Business
04 Dec 02 | Americas
20 Nov 02 | Business
16 Nov 02 | Business
06 Nov 02 | Crossing Continents
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