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Band-Aid?

THE INTERNATIONAL MONETARY FUND HAS patched together a rescue package worth up to US$40 billion for Argentina--a relief for investors who feared the country would default on its $123 billion in foreign debt but a sacrifice for Argentines worn down by austerity programs.

The rescue plan may plug the hole in a foundering ship, but will it get the boat back to port?

"The government promised us change, but all it has done is to deepen the problems of those most in need."

retired accountant Alejandro Lencina, in Buenos Aires (CNN)

"If Argentina goes under, there is a possibility there could be contagion that could engulf the rest of Latin America."

Sebastian Edwards, former World Bank economist (The Los Angeles Times)

"Argentina is badly beaten up, so Chile is going to get hit."

Walter Molano, BCP Securities (Reuters)

"The rapid response by the IMF was an attempt to try to contain the crisis in Argentina... and avoid its spread."

Morris Goldstein, Institute for International Economics and former IMF official (Reuters)

"Although the upcoming IMF package is great news for Argentina, the problems in the medium term still remain to be solved."

J.P. Morgan, in a letter to its clients

"It deflates the panic for a while."

Rita Lavin, senior economist at Standard & Poor's (Business Week)

"When the dust settles, the question will return: 'How much can this economy grow?'"

Andres Lederman, Argentina economist at Salomon Smith Barney (Financial Times)
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Copyright 2001, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

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Publication:Latin Trade
Date:Feb 1, 2001
Words:241
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