Fernandez does not expect recession in Argentina
Reuters, Thursday, September 03, 1998 at 21:28
WASHINGTON, Sept 3 (Reuters) - Argentina's Economy Minister
Roque Fernandez dismissed Standard & Poor's assessment that an
Argentine recession is possible and said credit rating agencies
should hold their views during times of market tumult.
"We do not expect a recession," Fernandez told reporters
after a meeting at the International Monetary Fund on the
impact of the world financial turbulence on Latin America.
Fernandez said markets were acting "irrationally" due to
the panic caused by the Russian crisis and that with time
investors will begin to differentiate between Latin America and
other parts of the world such as southeast Asia.
"The markets will discriminate and they will recognize
sooner or later that there is nothing fundamentally wrong in
Latin America," he said.
Moody's Investors Service downgraded Brazil and Venezuela's
debt ratings to reflect what it considered to be a growing risk
of payments disruptions, and put Mexico and Argentina on review
for possible downgrades.
Fernandez said credit rating agencies were involved in
"intellectual coverage or hedging" in the latest series of
recommendations for Latin America.
"When we are in a situation of much nervousness or
uncertainty, this type of rating should be suspended," he said,
while acknowledging that the agencies had a responsibility to
report to their clients.
Latin American finance ministers at the IMF meeting
criticized international investors for lumping Latin America in
the same basket as other emerging markets that have run into
financial trouble, causing ripples that have hurt their own
economies.
"We should try to pacify (markets) and try to explain that
there is nothing fundamentally wrong with any country in the
region," Fernandez said at the end of the first day of the
two-day meeting.
"Sooner or later the market will differentiate what is
going on in each country," he said.
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Copyright 1998, Reuters News Service |
