Argentina’s feared commerce secretary quits; accused of bullying executives and faking data

BUENOS AIRES, Argentina – Argentina’s feared commerce secretary quit Tuesday, a day after a Cabinet reshuffle gave others more power in the inner circle of President Cristina Fernandez.

Guillermo Moreno was a pit-bull for the president, trying to fine and jail economists for publishing independent inflation numbers, threatening black-market currency traders whose business gave many Argentines their only access to dollars in recent years, and breaking up board meetings of the newsprint company jointly owned by the opposition Grupo Clarin.

Farmers and ranchers blamed him for blocking their exports, while executives accused him of holding up their imports, forcing them to freeze prices and making their corporate lives miserable until they went along with the government’s policies.

Many executives, always speaking on condition of anonymity to avoid even more trouble, described how they trembled when Moreno called them into his office, where a handgun was conspicuously within reach on his desk, to personally pressure them to agree to some government demand in exchange for releasing barriers to their commerce.

Presidential spokesman Alfredo Scoccimarro said Fernandez accepted the resignation, effective Dec. 2, and designated Moreno as an economic attache at the Argentine Embassy in Italy.

Moreno, who is under formal investigation for allegedly abusing his authority, made no immediate comment.

The surprise announcement came a day after Fernandez named a seasoned politician and close friend, Chaco Gov. Jorge Capitanich, as her new Cabinet chief, while installing as economy minister the much younger Axel Kicillof, an unorthodox economist who inspired the uncompensated seizure of Argentina’s YPF oil company from Spain’s Grupo Repsol.

“It’s good news that Moreno goes. He thought that by bullying and threatening businessmen he could develop confidence in the country,” Fernando “Pino” Solanas, an opposition senator-elect, told the local Diarios y Noticias news agency. “But it’s not just Moreno; Kicillof and the whole economic team of the government have left the economic ship adrift.”

Moreno was commerce secretary under the late President Nestor Kirchner, who was Fernandez’s husband, and was closely involved in the political intervention in 2007 that forced the national statistics agency INDEC to change its consumer prices methodology. Ever since, official inflation has never budged above 10 per cent a year, even as independent economists tracked inflation two to three times higher. Eventually, even close government supporters publicly discredited the official inflation data and the International Monetary Fund formally censured Argentina, refusing to use its numbers in global reports.

Former economy ministers cheered Moreno’s departure in interviews with Todo Noticias, a cable channel owned by Grupo Clarin. Miguel Peirano, now allied with the opposition Renewal Front, called Moreno “a functionary who abused his state authority for an anti-democratic government.”

Opposition deputy-elect Martin Lousteau said it remains to be seen if Moreno quit in a simple power struggle or if this means the government might change its economic policies.

“The first thing this government needs to do is recognize that it has a structural problem and that this problem is called inflation,” Lousteau said.