Argentina Hopes for Aid Package After IMF Visit

Easter may have brought a welcome lull to Argentina’s smoldering social tensions, but a visit by an International Monetary Fund contingent this week could make or break a government desperate for billions of dollars in aid.

Daily protests of everything from deepening poverty to economic policy thinned as thousands of Argentines headed out of town for the five-day public holiday. Police reported only a handful of isolated, small-scale shop robberies and looting incidents.

But amid fears that unrest could flare into repeat scenes of the bloody rioting and pillaging that toppled the elected government late last year and left 27 dead, President Eduardo Duhalde faces a race against time to win international aid.

The IMF has hinted that aid could be around the corner if all goes well in negotiations with officials due to arrive in Argentina today. Argentina hopes the IMF will front a multibillion-dollar aid package to help end its grinding four-year recession.

Duhalde must restore confidence among international lenders and investors alike and contain the fears of a public that continues to scramble to seek refuge from the depressed peso--raising the specter of a return to Argentina’s hyperinflationary past.

Vice Economy Minister Jorge Todesca had said the government intended to raise export taxes on commodities, agricultural oils and flour to about 20% to help rake in an additional $1.2 billion to offset a sharp slump in tax revenues.

Investors, awaiting word on promised economic measures from the government, also will be looking to see if the central bank manages to stem the slide of the peso when local foreign exchange and stock markets resume trading Tuesday.