October 28, 2010 / 2:33 AM / 7 years ago

UPDATE 9-Argentina's powerful ex-president Kirchner dies

* Kirchner was contender for 2011 presidential race

* He oversaw Argentina’s recovery from economic crash

* Critics saw him as divisive, authoritarian figure

* Argentina asset prices rally following news (Adds fresh quotes, color on supporters)

By Helen Popper and Nicolas Misculin

BUENOS AIRES, Oct 27 (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 heightening 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. He died of a heart attack.

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.

Kirchner’s death raises questions about the government’s strategy for the presidential election next October, and may encourage Fernandez to run for a second term and adopt a less confrontational stance in a bid to garner broader backing.

“History will rightly remember him as one of the best presidents of the last 50 years,” said Ricardo Garcia, 52, a lawyer who joined tens of thousands of supporters in front of the famous pink presidential palace.

“The country is no longer on its knees like it was in the 1990s,” he added, referring to an era of free-market economic policies that Kirchner frequently blamed for causing the 2001/02 meltdown.

Supporters tied bunches of roses and condolence messages to the railings of the palace, some reading “Thank you Nestor” and “Stay strong Cristina.” The blue-and-white national flag flew at half staff during the day, a public holiday.

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 -- especially among middle class Argentines, dented by messy disputes with farmers and leading media conglomerate Grupo Clarin. (CLA.BA)


Full coverage of Kirchner’s death: [ID:nARGENTINA]

Political risks in Argentina: [ID:nRISKAR]

Breakingviews column: [ID:nN27269977]


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.


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.

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, and Argentine financial assets rallied on news of his death.

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.

“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.

Fernandez has largely maintained the policies of her husband, who was seen as having a good chance of winning a first-round election vote next year -- partly due to divisions within opposition ranks.

Argentia’s portion of the JP Morgan EMBI Plus sovereign bond index 11EMJ tightened 20 basis points to 513 basis points, the tightest level in more than two years. The index overall was just 2 basis points tighter.

U.S.-traded shares of Argentina’s BBVA Banco Frances SA (BFR.N) rose 3.26 percent to $12.34 while Telecom Argentina_ (TEO.N) gained 7.43 percent to $24.45.

Argentina’s financial markets were closed for the holiday. (Additional reporting by Eduardo Garcia, Luis Andres Henao and Maximilian Heath and Karina Grazina in Buenos Aires, Sujata Rao in London and Guillermo Parra-Bernal in Sao Paulo, Editing by Kieran Murray and Sandra Maler)

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