Fw: ARGENTINA DECLARES STATE OF EMERGENCY

["Nello Margiotta" <animarg@tin.it>]

 [NOTE: The following is a report from the BBC, dated Thursday, 20
 December, 2001, 01:37 GMT. It is posted for information purposes.]


 Argentina declares state of emergency

 Union members resorted to violence in Buenos Aires

 The Argentine Government has declared a state of emergency after violence
 erupted over the country's worsening economic crisis. Argentine President
Fernando de la Rua will address the nation later on Wednesday to explain
 the move, the Associated Press news agency says.

 ["It is under control and I emphasise the peaceful nature of the Argentine
people." -- President Fernando de la Rua]

 The emergency decree grants the Government special powers to quell looting
 and rioting and will last for 30 days.

 It will allow the authorities to bring troops and other security forces
 onto the streets. Public meetings are also banned.

 Four people were killed and dozens injured on Wednesday in clashes with
 police across the country, in the worst civil unrest in Argentina since
1989.

 Thousands of people took to the streets - many looting from stores - in
 protest at wage cuts, spiralling unemployment and strict government
 austerity measures aimed at coping with a massive public debt and
 four-year-long recession.


 Default risk


 The credit ratings agency Standard & Poor's has warned that Argentina
 could default on its $132bn sovereign debt as early as next month.

 "It is likely, though still not certain, that in the very short term,
 Argentina will miss a payment on their debt," said the agency's managing
 director of sovereign debt rating, John Chambers.

 "That would be outright default."

 A default would in effect cut off any lifeline from the International
 Monetary Fund and send Argentina spiralling even deeper into a chaotic
 economic crisis.

 The government has acted swiftly to try to take control of the situation,
 announcing it will start distributing free food.

 The Labour Minister, Jos=E9 Gabriel Dum=F3n, said the president had already
 authorised the distribution of $7m worth of food, and he called on
 Argentines to remain calm.


 Running battles


 Police clashed with rioters in the capital, Buenos Aires, and the
 provinces, as protests which began at the weekend escalated. [

 ["I feel bad about it but we're dying of hunger." --Sonia Aristici,
 looter]

 Dozens of stores were ransacked in Buenos Aires and the northern Entre
 Rios province, while in the second-largest city, Cordoba, workers
 protesting at government plans to reduce wages set fire to the town hall.

 Looting of supermarkets was reported in at least half a dozen cities,
 including Rosario, north of Buenos Aires, and Mendoza in the west.

 In Santa Fe province, north of the capital, a 15-year-old boy was shot
 dead by an unidentified gunman.

 Elsewhere, a man was stabbed to death by a storeowner on the outskirts of
 the capital, and a man and a woman were shot dead by shopkeepers trying to
 protect their stores in the same area.


 President under pressure

 As the violence raged, the opposition-dominated Congress voted to repeal
 special powers granted to Economy Minister Domingo Cavallo earlier this
 year.


Women fight to get food handouts

 Similar unrest marked the last financial crisis in Argentina in 1989,
forcing the then president, Raul Alfonsin, to leave office early.

 There is now growing pressure on President de la Rua to do the same.
 On the streets, some supermarkets handed out food packages to prevent
looting as thousands of people gathered outside shops, while police in
 riot gear - heavily outnumbered by protesres - stood guard.

 The violence also resulted in the cancellation of the second-leg final of
the Copa Mercosur football competition between Argentina's San Lorenzo and
 Flamengo of Brazil.


 Deepening recession


 The social unrest has been provoked by a deepening economic crisis in
 Argentina.

 There has been a recession in Argentina for almost four years, and
 unemployment has risen to almost 20%.

 Mr de la Rua and Economy Minister Domingo Cavallo are desperately trying
 to avoid a devaluation or a default on Argentina's foreign debt payments.

 Earlier this month, the IMF refused Argentina a further $1.3bn in standby
 loans, unless it balanced its budget for the year 2002.

 Mr Cavallo has put forward budget proposals slashing government spending
 by 20% - but only by cutting public sector wages and reducing pension
 provisions.