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New finance minister faces difficult task

Latest update : 2008-04-26

Carlos Fernandez, the head of Argentina's tax collection agency and an ally of former president Nestor Kirchner, has been appointed as the country's new economy chief. He replaces Martin Lousteau, ousted in the wake of a massive farmer strike.

Carlos Fernandez, the head of Argentina's tax collection agency, took over as economy minister Friday after his predecessor was sacked amid spiralling inflation and anger among farmers.
  
Fernandez, 54, an expert on state finance, was sworn in by President Cristina Kirchner at the presidential palace, replacing Martin Lousteau, who left after just four months on the job.
  
"It is a challenge," Fernandez, who is close to Kirchner's husband, former president Nestor Kirchner (2003-2007), told reporters. "I will continue to work to ensure that things go well."
  
Lousteau, 36, left his post as the government struggles to resolve a bitter dispute with farmers who staged a crippling three-week strike last month over a tax hike on soybean exports.
  
April 2, the farmers declared a one-month halt to their strike, which was the first major test of the new, four-month-old Kirchner government and, some say, sharply eroded its authority.
  
During their 21-day protest, thousands of farmers erected some 400 road blocks in central Argentina, leading to unprecedented shortages of food and raw materials in major urban centers.
  
The raising of export tariffs on soya products -- an agricultural mainstay of Argentina -- from 33 to 44.1 percent triggered the strike.
  
Farmers said that, along with income taxes, transport costs and the high cost of land, it would push many out of business.
  
Soybeans are dubbed "green gold" in Argentina for the sky-high prices they fetch on the world commodity market.
  
Half of Argentina's 30 million hectares of farmland are now given over to soybeans, which represent an export income of 24 billion dollars (15 billion euros) a year.
  
The confrontation has deepened divisions between Argentina's upper and middle classes -- including many well-off farmers -- and the poor class, swollen by the country's 2001 financial collapse, which supports Kirchner.
  
The fragile truce between the agricultural sector and the government expires May 2, and could see fresh protests in rural areas.
  

Date created : 2008-04-26

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