The Foreign Service Journal, October 2004

So, what can Argentina expect from the next government of the United States? Analysts anticipate differences of style rather than substantial changes in U.S. poli- cies. They point also to the fact that in the American system, it is not so much the president but rather Congress that is decisive as far as the framework for bilateral relations is concerned. This is especially true today as the Republicans control the House and the Senate as well as the pres- idency. But this does not change the top priority for Argentina: that the next U.S. administration continue supporting Argentina in dealing with the International Monetary Fund, the World Bank and the rest of the international financial community. “The fundamental thing for us this year was clearly to have the comprehension and the support of the U.S. government in our recovery framework, stabilization and economic growth proposals for Argentina, and especially our decisions in the international financial field,” says Argentina’s ambassador in Washington, José Octavio Bordón. What Is Important And so, Ambassador Bordón emphasizes, it is very important that both the Republicans and the Democrats understand the reasons the American administration passed from a critical or indifferent stance — adopted well before the Argentine crisis and maintained by the Bush administration, despite former president Carlos Menem’s extensive market- based reforms, throughout 2002 — to a favorable attitude toward Argentina during the past 18 months. During that period, looking forward to the presi- dential elections in Argentina in May 2003 in which President Nestor Kirchner was elected, the U.S. sup- ported the country in reaching an unusual deal with the IMF (for only six months) that was the beginning of re-establishing international relations and eco- nomic recovery. Kirchner’s economics minister, Roberto Lavagna, realized that a new paradigm against rescue packages was emerging in the interna- tional community, and that Argentina could not expect to get fresh money for a long period of time. Lavagna’s new recovery strategy was to maintain exposure on multilateral debt, in order to get some fiscal room to deal with private creditors. More recently, he has inferred also that the country is willing to reduce its exposure somewhat. Pres. Kirchner’s initial over- tures toward the Bush adminis- tration led to a new agreement with the IMF in which, again, the U.S. played a pre- dominant role. The program set at the IMF-World Bank meetings in Dubai was strongly resisted by the Europeans and Japanese, because of the Fund’s lend- ing-into-arrears policy, in which a sovereign country’s good-faith negotiations with private creditors are the basis for exceptional access to a Fund program. Now, it is time for the Argentine government to again sit at the table with the IMF to discuss the next two years’ goals. Argentina will ask the next presi- dent of the United States to continue with the process, supporting the country with credit rollovers in the IMF, the World Bank and the IDB, until pri- vate investors’ confidence is fully restored. Official Preferences John Kerry’s idea of creating a “New Community of the Americas” has sown new hope in Argentina. Besides developing a continental transport master plan and working to harmonize customs, immigration and security politics, Kerry is backing legislation to create a “Social Investment and Economic Development Fund for the Americas.” Authored by a bipartisan group led by Kerry advisor and Democratic caucus head Rep. Bob Menendez, D- N.J., H.R. 3447 would establish a fund to distribute $250 million per year to strengthen democracy and combat poverty in Latin America. Introduced in the House in November 2003, the bill was reported out of subcommittee and referred to the full House International Relations Committee for action in May. Although nobody has mentioned Argentina specif- ically in connection with the initiative, news of the F O C U S O C T O B E R 2 0 0 4 / F O R E I G N S E R V I C E J O U R N A L 35 John Kerry’s idea of creating a “New Community of the Americas” has sown new hope in Argentina.