Argentina faces IMF penalties over failure to meet inflation deadline
Source: the guardian
Argentina faces the prospect of eviction from the world economic community after its apparent failure to respond to a three-month deadline set by the International Monetary Fund to produce accurate inflation and growth statistics.
Ejection from the IMF could lead to a variety of economic and political penalties, including exclusion from the G20 of industrial nations. IMF rules state that member states "must not co-operate with a non-member in practices that would be contrary to … the purposes of the Fund".
Some experts believe the IMF's managing director, Christine Lagarde, has lost patience with President Cristina Fernández de Kirchner's government. A spokesman for the IMF has said that a report will be submitted to its board on Monday which will decide the course of action.
Official inflation statistics in Argentina show prices rising at around 10% but independent assessments have prices rising at 25% and more. The problem that inflation is running higher than official figures is acknowledged by Gabriela Cerruti, an MP from the governing party. Senior government ministers rarely give interviews to the international media but Cerruti said: "I think the real problem is if you have unemployment, or you're losing your home, not the statistics themselves. People always argue over statistics. Prices may be rising up to 20% a year, but people's pay is also going up by 20%."