- The Washington Times - Monday, December 24, 2001

BUENOS AIRES Adolfo Rodriguez Saa, a populist provincial governor, was sworn in as Argentina's interim president yesterday, saying he would suspend payment of the crushing foreign debt that led to his predecessor's downfall.
The announcement by the 54-year-old leader prompted a rousing ovation from Congress minutes after it had voted 169-38 to appoint him as caretaker president following nightlong debate and wrangling.
Rushing to fill the term vacated last week by Fernando de la Rua during a popular rebellion, Mr. Rodriguez Saa is to rule pending the results of a special election March 3.
"Let's take the bull by the horns. We are going to talk about the foreign debt," he said in his inaugural address. "The Argentine state will suspend the payment of the foreign debt.
"All the resources allocated in the budget to pay the foreign debt will be dedicated instead to create jobs while debt payment remains suspended," he added. "The social emergency is Argentina's most serious problem."
But the new president made clear that suspending payments on the $132 billion debt both the principal and interest did not mean repudiating it and that his interim government would seek an early dialogue with creditors.
"Argentina's situation is very difficult. I ask for help," Mr. Rodriguez Saa said three days after deadly rioting and looting forced Mr. de la Rua to resign. Twenty-seven persons were killed and hundreds injured.
Mr. Rodriguez Saa said his priority would be to help pull Argentina out of a four-year recession that had left nearly 40 percent of the 36 million population in poverty. Some 18 percent are out of a job.
The measures announced by Mr. Rodriguez Saa marked a radical shift. He ruled out a devaluation and dismissed calls to replace Argentina's currency, the peso, with the U.S. dollar. Instead, he announced without elaboration plans to introduce a "third currency."
He also vowed to distribute food among poor families and to create 1 million jobs. "Wherever an Argentine family exists without a job, that will be our priority," he said.
His announcement on suspension of the foreign debt payment won widespread support, especially from his Peronist Party, now returning to power after two years in opposition.
Support also came from ordinary Argentines, who often complained they were paying a stiff price for Mr. de la Rua's policies and the restrictions he imposed in order to pay the debt. The restrictions included a partial freeze on access to bank accounts a measure expected to be lifted soon.
"They did the right thing in not paying foreign debt now," said Francisco Cordoba, a deliveryman. "We've got to get things in order. There is a lot of poverty."
Some criticism arose, however, especially from conservative economists.
Manuel Solanet of the Foundation for Latin American Research called the move "typical Peronist demagoguery and populism."
Jorge Avila of the Center for Currency Studies warned that "reality will crush the president. In a few weeks he will have to face the United States and foreign creditors. He will quickly lose his optimism."

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