Argentina tightens exchange controls to stem capital flight

Buenos Aires, Oct 29 (AFP/APP): Argentina introduced strict exchange controls Monday to preserve depleting reserves as president-elect Alberto Fernandez and incumbent Mauricio Macri held talks, seeking to reassure investors over the country’s impending swing from market-friendly policies to protectionism.

The country’s central bank said the currency exchange controls would help stem a surge in capital flight, a day after Fernandez swept to victory in presidential elections.

Macri’s long-anticipated defeat has set off market jitters about the return to power of protectionist Peronists, including former president Cristina Kirchner, who will be Fernandez’s vice president.

The Argentine stock exchange lost 3.9 percent in a volatile day of trading on Monday.

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The Fernandez victory — and an anticipated sea change in Argentine monetary policy — comes amid a lengthy recession and a debt crunch, which has raised market fears of a possible default on a $57 billion IMF loan.

International Monetary Fund chief Kristalina Georgieva congratulated Fernandez and vowed to work with his government to stabilize the economy.

“We look forward to engaging with his administration to tackle #Argentina’s economic challenges and promote inclusive and sustainable growth that benefits all Argentines,” Georgieva tweeted.

US Secretary of State Mike Pompeo echoed her comments, saying in a statement that Washington stands “ready to work with Alberto Fernandez as the new President of Argentina to address the interests our countries share.”

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