Argentine president defends aides, vows to stay course

By Fiona Ortiz

BUENOS AIRES (Reuters) - Argentine President Cristina Fernandez, who has spent most of her first eight-months in office in a deep political crisis, defended her administration on Saturday and ruled out further cabinet changes.

Despite rising prices topping Argentines' concerns Fernandez indicated she would stay the course with economic policies such as foreign exchange controls that have made exports competitive but critics say have stoked inflation.

Fernandez was forced last month to ditch a controversial tax increase on soy exports and replaced her cabinet chief and agriculture secretary after a bitter four-month stand-off with farmers ended when senators rejected the tax.

"No," she said when asked whether she would make more changes in her cabinet.

The rare news conference, her first since succeeding her husband, Nestor Kirchner, as president in December, marked a change of style for the combative Fernandez, who has stoked anger with her harsh rhetoric against the farm sector.

Argentina's first elected woman president said her only mistake was to underestimate the fierce opposition she would encounter from big business in the agricultural sector.

"I would do each and every thing that I did again," Fernandez said. "I would push resolution 125 (which raised the tax). For the first time in Argentina since the advent of democracy ... we have seriously discussed ... a law that for the first time addressed redistribution of revenue."

The center-left leader said she would continue to fight for fairer wealth distribution in Argentina, South America's No. 2 economy, where a quarter of the population lives in poverty.

Argentina's economy has seen five years of robust expansion, but high inflation and the farm crisis damaged the country's stocks and bonds and hit consumer confidence.

Official numbers showing the consumer prices index rising about 9 percent annually have been widely discredited and private estimates put inflation at higher than 20 percent.

Fernandez defended official price data, saying any methodology can be questioned. She noted that Argentines are better off than people in neighboring countries, where she said wages are lower but food and fuel prices are higher.

"This news conference is not enough to confirm any substantial changes in the government," said political analyst Rosendo Fraga. He noted that Fernandez is still in conflict with her own vice president and governors from rural provinces who opposed the soy tax.

POWER COUPLE

Fernandez also backed her controversial domestic commerce secretary, Guillermo Moreno, who is widely accused of undermining inflation data.

Political opponents have called for wider changes in the cabinet, and especially for Moreno to be replaced to restore the credibility of statistics agency INDEC.