ARGENTINE FINANCES

Press, Volume XCV, Issue 28234, 23 March 1957, Page 11

ARGENTINE FINANCES

Warning Of Bankruptcy

(Special Correspondent N.Z.P.AJ . (Rec. 7 p.m.) LONDON. March 22. Messages from Buenos Aires say that Argentinians have been ( warned that their country is on the verge of bankruptcy. j In a broadcast to the Argentine , people the provisional President. i General Aramburu. and the Finance Minister, Dr. Verrier. • painted what correspondents call . a gloomy picture of the country’s economic situation, indicating that , it had deteriorated in 18 months , since the fall of President Peron. ( General Aramburu said that the problem was grave and needed , immediate solution. The country ; was undercapitalised, output was j low and the transport system ( antiquated and in deficit, roads were insufficient and electric power lacking. Dr. Verrier said that the country’s financial and economic situation was grave and the prospective balance of payments deficit for the current year was 200 m dollars. Reserves Low Unless remedial action was taken immediately the country’s reserves, which were now only 237 m dollars would be exhausted by the end of the year. The effect of this would be the cutting off of Argentina’s indispensable supplies of fuel, raw materials, anS confidence abroad in the country’s recovery would be undermined. Dr. Verrier said that this year’s and last year’s budget deficits would have to be met chiefly by issuing paper money as there was little hope of floating loans. The “Daily Telegraph’’ Buenos Aires correspondent said that the Argentine Government was completely divided on the policy to be adopted to avert disaster. Argentina’s provisional Government headed today towards a new Cabinet crisis arising from the claim of Dr. Verrier, that the country was going bankrupt, said a United Press dispatch. Some sources said that Dr. Verrier already had tendered his resignation to President Aramburu in order to make easier any iteps the Government choose to take.