Argentine president asks Congress to ratify soy tax
(Adds farm leaders' reactions paragraphs 2, 7-8)
By Kevin Gray
BUENOS AIRES, June 17 (Reuters) - Argentine President Cristina Fernandez moved to defuse a prolonged political conflict on Tuesday, asking Congress to ratify a tax hike on soy exports that farmers criticized as authoritarian.
Farm leaders said the president's bill was a positive gesture and they would evaluate it on Wednesday and decide whether to lift their blockade of grains exports. Farmer and trucker roadblocks have caused fuel and food shortages.
Argentina is an agricultural powerhouse, accounting for 3 percent of global farm exports. Growers have benefited from high prices for their top crop, soy.
Fernandez says the soy tax increase adopted in March will redistribute windfall profit and alleviate poverty, but enraged farmers have frozen grains trade with their protests and the conflict has sparked wider anti-government demonstrations.
"Those citizens who are against these policies, because they believe their interests are affected, can go to the courts," Fernandez said on live television on Tuesday evening.
Farm leaders applauded the decision to involve Congress, even though Fernandez's Peronist Party has a clear majority.
Political power is concentrated in the presidency in Argentina and Fernandez has been criticized for an arrogant style during the farm conflict.
"We hope Congress won't just rubber stamp this like a notary... We hope the bill can be debated, modified and adapted so it doesn't benefit just big producers, but also small and medium producers," Eduardo Buzzi, president of one of Argentina's four main agricultural groups, said at a news conference with other farm leaders.
DEFENDING FOOD PRICES
Just two hours before Fernandez spoke, her husband, ex-President Nestor Kirchner, struck a less-compromising stance when he publicly defended the measure as pressure mounted on the government to resolve the dispute.
"We're going to defend (it) with all our force," said Kirchner, who heads the Peronist Party. "You know what's at stake here? We are defending food prices for Argentines."
Officials have said the new tax system, which moves export levies on a sliding-scale along with global grains prices, would help lower food prices at a time of growing inflation.
Kirchner also slammed the media for what he called their systematic efforts to weaken the government. Stock and bond prices fell after his speech, which was seen as uncompromising.
One poll published on Tuesday showed Fernandez's popularity has slumped to 20 percent, well below March levels.
The president and her husband spoke a day after tens of thousands of Argentines banged pots and pans in the streets and honked their car horns in unison to protest the government's handling of the growing crisis.
The standoff with farmers has driven soy prices near record highs and sparked concerns of political instability in Argentina, which has a long history of toppled leaders.
Hoping to show it still has widespread support, the center-left government is planning a massive rally on Wednesday even though some political allies suggested it would only deepen the conflict.
Opposition leaders, including Buenos Aires Mayor Mauricio Macri, stepped up calls for the government to resolve the conflict by restarting talks with farmers.
The tax on soy, which accounted for nearly a quarter of export earnings last year, angered farmers who were already complaining of price controls and other state intervention in the sector.
The dispute is threatening to slow Latin America's No. 3 economy, which has registered 8 percent average annual growth over the last five years, due partly to high Asian and European demand for its soy products. (Additional reporting by Helen Popper, Karina Grazina and Hilary Burke; Editing by Eric Walsh)
By Kevin Gray
BUENOS AIRES, June 17 (Reuters) - Argentine President Cristina Fernandez moved to defuse a prolonged political conflict on Tuesday, asking Congress to ratify a tax hike on soy exports that farmers criticized as authoritarian.
Farm leaders said the president's bill was a positive gesture and they would evaluate it on Wednesday and decide whether to lift their blockade of grains exports. Farmer and trucker roadblocks have caused fuel and food shortages.
Argentina is an agricultural powerhouse, accounting for 3 percent of global farm exports. Growers have benefited from high prices for their top crop, soy.
Fernandez says the soy tax increase adopted in March will redistribute windfall profit and alleviate poverty, but enraged farmers have frozen grains trade with their protests and the conflict has sparked wider anti-government demonstrations.
"Those citizens who are against these policies, because they believe their interests are affected, can go to the courts," Fernandez said on live television on Tuesday evening.
Farm leaders applauded the decision to involve Congress, even though Fernandez's Peronist Party has a clear majority.
Political power is concentrated in the presidency in Argentina and Fernandez has been criticized for an arrogant style during the farm conflict.
"We hope Congress won't just rubber stamp this like a notary... We hope the bill can be debated, modified and adapted so it doesn't benefit just big producers, but also small and medium producers," Eduardo Buzzi, president of one of Argentina's four main agricultural groups, said at a news conference with other farm leaders.
DEFENDING FOOD PRICES
Just two hours before Fernandez spoke, her husband, ex-President Nestor Kirchner, struck a less-compromising stance when he publicly defended the measure as pressure mounted on the government to resolve the dispute.
"We're going to defend (it) with all our force," said Kirchner, who heads the Peronist Party. "You know what's at stake here? We are defending food prices for Argentines."
Officials have said the new tax system, which moves export levies on a sliding-scale along with global grains prices, would help lower food prices at a time of growing inflation.
Kirchner also slammed the media for what he called their systematic efforts to weaken the government. Stock and bond prices fell after his speech, which was seen as uncompromising.
One poll published on Tuesday showed Fernandez's popularity has slumped to 20 percent, well below March levels.
The president and her husband spoke a day after tens of thousands of Argentines banged pots and pans in the streets and honked their car horns in unison to protest the government's handling of the growing crisis.
The standoff with farmers has driven soy prices near record highs and sparked concerns of political instability in Argentina, which has a long history of toppled leaders.
Hoping to show it still has widespread support, the center-left government is planning a massive rally on Wednesday even though some political allies suggested it would only deepen the conflict.
Opposition leaders, including Buenos Aires Mayor Mauricio Macri, stepped up calls for the government to resolve the conflict by restarting talks with farmers.
The tax on soy, which accounted for nearly a quarter of export earnings last year, angered farmers who were already complaining of price controls and other state intervention in the sector.
The dispute is threatening to slow Latin America's No. 3 economy, which has registered 8 percent average annual growth over the last five years, due partly to high Asian and European demand for its soy products. (Additional reporting by Helen Popper, Karina Grazina and Hilary Burke; Editing by Eric Walsh)
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