Argentina's powerful ex-president Kirchner dies

BUENOS AIRES Wed Oct 27, 2010 6:44pm EDT

1 of 9. Then Argentine first lady and presidential candidate senator Cristina Fernandez de Kirchner (R) embraces then President Nestor Kirchner during the closing campaign rally in La Matanza, on the outskirts of Buenos Aires October 25, 2007.

Credit: Reuters/Marcos Brindicci

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BUENOS AIRES (Reuters) - Argentina's Nestor Kirchner, the president's powerful husband and a top contender to succeed her next year, died on Wednesday, lifting stock and bond prices but stoking uncertainty ahead of the election.

Kirchner, 60, was president between 2003 and 2007 and is credited by many with putting South America's No. 2 economy back on its feet after a devastating 2001/02 crisis, but critics reviled his combative style and interventionist economic policies.

Argentine bond and stock prices rose on news of the death of the center-leftist, who kept a firm hold on the reins of power even after his wife Cristina Fernandez was elected to succeed him in 2007. He died of a heart attack.

His death raises questions about the government's strategy for the presidential election next October, and might encourage Fernandez to seek a second term and take a more moderate line in a bid to garner broader political support.

"The leader of the pack has died ... for better or worse this was a man who knew how to make decisions," said psychologist Maria Gutierrez in downtown Buenos Aires, which was unusually quiet due to a public holiday.

At the city's famous pink presidential palace, the national flag flew at half-mast and thousands of supporters tied roses and messages to the railings, some reading "Thank you Nestor."

Kirchner, who died in the southern city of El Calafate, was still popular when he left the presidency. But his approval ratings have since fallen, dented by messy disputes with farmers and leading media conglomerate Grupo Clarin.

A lawyer, Kirchner started his political career in the Patagonian province of Santa Cruz, where he was governor for many years, and was elected president as a virtual unknown in 2003 on the ashes of the economic meltdown.

A member of the dominant Peronist party, he quickly built strong alliances and oversaw a strong economic recovery that won him solid backing. He would almost certainly have won a second term in 2007, but chose to make way for his wife.

STATE CONTROL

Opponents of the presidential couple criticized Kirchner's tough political style and outspoken attacks on big business, journalists and political rivals.

When farmers rebelled over a tax hike on soy exports in 2008, Kirchner accused them of plotting a coup, and increased state control over the economy, nationalizing several companies.

Financial markets never forgave Kirchner for the tough 2005 renegotiation of some $100 billion in defaulted bonds, which saw creditors walk away with a steep discount.

Kirchner focused on cementing political alliances at home to shore up his administration and that of his wife, but he was secretary general of South America's regional grouping Unasur and had close links with fellow Latin American leftists such as Venezuela's Hugo Chavez, who called his death "a huge loss."

Chavez declared three days of national mourning and leaders including U.S. President Barack Obama and Chilean President Sebastian Pinera sent messages of condolence.

Felipe Sola, an Argentine lawmaker who split from the government to join the ranks of a dissident Peronist party wing, called his rival Kirchner "a formidable fighter."

"I've criticized him and I've defended him, but I've always admired his ability and recognized him as a unique politician," Sola said.

Kirchner also won praise for his efforts to bring military leaders to trial for human rights crimes committed during the nation's 1976-1983 dictatorship, in which as many as 30,000 people were killed in a crackdown on leftist dissent.

When his wife succeeded him, many commentators compared the power couple to another husband-and-wife political dynasty to dominate Argentine politics -- former President Gen. Juan Domingo Peron and his famous wife Evita.

Although he never formally confirmed his candidacy, Kirchner was expected to run at the next presidential election in October 2011, but concerns over his health increased after he underwent arterial procedures in February and September.

His wife's government said Kirchner was rushed to hospital in the early hours of Wednesday after suffering an apparent heart attack at the couple's weekend home in Patagonia. Fernandez was with him when he was taken ill.

Three days of mourning were declared and a wake will be held in Buenos Aires on Thursday.

Investors disliked Kirchner's unorthodox economic policies, such as price controls and export freezes to curb inflation. Those policies have largely continued during his wife's administration, and Argentine financial assets abroad rallied on news of his death.

"For Argentina, as a credit and a country that is the recipient of investors' money, there is no better scenario than having Kirchner out of the political arena," said Roberto Sanchez-Dahl, an emerging market debt manager.

Argentia's portion of the JP Morgan EMBI Plus sovereign bond index tightened 71 basis points to 510 basis points in afternoon trade, the tightest level in more than two years. The index overall was just 10 basis points tighter.

U.S.-traded shares of Argentina's BBVA Banco Frances SA rose 1.25 percent to $12.10 while Telecom Argentina_ gained 5.84 percent to $24.09.

Argentina's financial markets were closed for the holiday.

(Additional reporting by Eduardo Garcia, Luis Andres Henao and Karina Grazina in Buenos Aires, Sujata Rao in London and Guillermo Parra-Bernal in Sao Paulo; Editing by Jerry Norton and Kieran Murray)

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Comments (1)
WeNotMe wrote:
Greater state control pulled Argentina from the ashes.
Obama is listening.

Oct 27, 2010 5:01pm EDT  --  Report as abuse
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