by the El Reportero news services
Cristina Fernández
The government of President Cristina Fernández announced Oct. 21 that it will send a bill to Congress to nationalize Argentina’s 10 private pension funds. The nationalization will give the government control over some $US30bn currently managed by private funds, around half of which is invested in Argentine government bonds.
The government says that the decision was made to safeguard pensions against the global economic downturn. It may well, however, be motivated by a less noble concern: Fernández’s increasingly cash-strapped government is desperate for money to service its debts next year, when its financing needs are set to almost double.
The news was met with horror by foreign investors, dealing a crushing blow to already shaky market confidence in Argentina, and has given the opposition another reason over which to unite against the Kirchners. An opposition daily, La Nación, went so far today (22 October) as to describe the decision as “legalized robbery”.
