Interview: Argentine candidate warns economic boom in danger

By Kevin Gray

ELDORADO, Argentina, Sept 14 (Reuters) - A former economy minister who helped craft Argentina's recovery from a deep crisis is campaigning for president warning the country's economic boom is in danger.

Roberto Lavagna, who worked under President Nestor Kirchner and is now one of his biggest critics, is fighting for second place in the October 28 election and hopes he can force a run-off against first lady Cristina Fernandez de Kirchner, the clear front-runner.

Lavagna carried his warnings on the economy to the steamy northeastern province of Misiones this week, using a town-hall meeting and a round-table with business leaders to remind them of his role in Argentina's economic turnaround.

"The Argentine economy, since earlier this year, is much more fragile," Lavagna told Reuters as he traveled between campaign stops. "It's a fact that can't be denied."

A 64-year-old ex-diplomat best known for persuading holders of Argentine bonds to take big losses after the country's 2002 debt default, Lavagna became a leading government antagonist after he was fired by Kirchner nearly two years ago.

He has, however, struggled to corral his positive image into votes and trails way behind Fernandez in election polls. With support in the low teens, he is battling center-left former lawmaker Elisa Carrio for second place.

His aggressive campaign in Argentina's interior -- he is traveling more than Carrio or Fernandez -- is aimed at forcing a run-off vote, but even if he manages it, Fernandez is still widely expected to win.

The first lady will avoid a November run-off if she wins more than 45 percent of the vote or takes more than 40 percent with a 10 percentage point lead.

Recent polls give her nearly 50 percent support as many voters credit her husband with lifting Argentina out of the 2001-02 economic crisis. If elected, she is expected to continue his economic policies.

THREATS TO GROWTH

Small crowds cheered Lavagna on as he hunted for votes in the semi-tropical Misiones province, home to crops of tobacco and yerba mate, a herbal tea.

He told supporters that Argentina has a "historic chance" to get on the right track but Kirchner was ruining it with heavy spending to ensure his wife is elected.

Lavagna warns that Kirchner's recent moves to increase spending and his failure to tame inflation are threatening the country's torrid economic growth.

Lavagna said there are signs that growth is slowing significantly and challenged government projections the economy will expand by 8 percent in 2007 for a fifth straight year.

"They are spending a big part of the primary budget surplus, private investment is slowing and there is a big decrease in the number of jobs being created," he said.