CRISIS IN ARGENTINA POSES NO THREAT TO BULGARIA

Business | December 21, 2001, Friday // 00:00

The crisis in Argentina poses no threat to Bulgaria’ s financial stability, officials from the Central Bank and the Cabinet announced on December 20, cited by Dnevnik Daily. Deputy Finance Minister Krassimir Katev said that Bulgarian debt instruments will not be affected. He expressed the hope that the instruments will continue to trade quite high. According to Deputy Minister Katev Bulgaria and Argentina can not be compared although both countries operate in a Currency Board mode, backed by the International Monetary Fund. The crisis in the Latin American country was triggered by the low fiscal discipline of the central and provincial governments. Martin Zaimov, Deputy Director of the Central Bank, shared these views. He said that the events in Argentina can happen in any country, irrespective of the monetary system, unless there is good financial discipline. Days of rioting in Argentina over austerity measures left 16 dead and forced the economy minister to quit on December 20. As the country grappled with its worst crisis in decades, police with special powers of arrest after a state of siege was decreed fought about 4,000 protesters with tear gas. Bulgaria introduced the IMF-prescribed restrictive Currency Board system in 1997 to curb government spending and soaring inflation.
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