Argentine President Eduardo Duhalde has named economist Roberto Lavagna to be his new economy minister. Mr. Lavagna, who has been serving as ambassador to the European Union, now faces the difficult task of pulling Argentina out of its deep economic crisis.
Ambassador Lavagna will be sworn in as economy minister Saturday. He takes the place of Jorge Remes Lenicov, who resigned Tuesday, after Congress refused to consider his controversial plan for preventing a collapse of the banking system by converting billions of dollars in bank deposits into longterm government bonds.
Mr. Lavagna, who once served as industry and commerce minister during the 1980's, is known as an advocate of strong trade and economic ties with the international community. He was one of the architects of the four-nation South American trade bloc, known as Mercosur.
In comments to The Wall Street Journal, Mr. Lavagna said he will take all the legal measures necessary to protect Argentina's domestic industry. He also ruled out granting any special treatment to Argentina's creditors and investors.
The new economy minister will need all his skills to deal with an economic crisis that brought down two presidents in December. A four-year recession has left Argentina bankrupt, with an unemployment rate of more than 20 percent.
The currency, once pegged to the U.S. dollar at a one-to-one rate, was devalued by President Duhalde in January, and has since lost almost 70 percent of its value. A freeze on most bank withdrawals imposed in December continues, and has led to almost daily protests in Buenos Aires, and other cities.
Mr. Lavagna, who returned to Buenos Aires Friday from Brussels, is scheduled to take part in a strategy session convened by President Duhalde for Saturday. Mr. Duhalde is reported to be considering abandoning the floating exchange rate for the peso.
Allowing the currency to float was one of the preconditions of the International Monetary Fund for granting Argentina an emergency loan. However, Mr. Duhalde said this week that meeting this precondition was a mistake.
Argentina is seeking a $9 billion emergency loan from the IMF. However, the fund has said it will not approve a bailout until Argentina comes up with a sustainable economic plan.