On September 17, he appointed Martín Redrado, who had been the country’s minister of commerce and international economic relations, as head of the central bank instead of renewing Alfonso Prat-Gay’s mandate.
Mr Prat-Gay, 38, a former head of emerging market research at JPMorgan Chase, was appointed to the central bank in December 2002, to complete the six-year term of the former central bank president, Pedro Pou, which ended in September. He was widely expected to receive his own six-year mandate.
However, it is understood that he fell out with the president after criticising the government’s debt negotiations. He had a tense relationship with Roberto Lavagna, the economy minister, and wanted to have more influence over appointments to the bank’s six-member board of directors.
Mr Redrado, Harvard-educated and president of Argentina’s Securities and Exchange Commission from 1991-1994, will be the sixth central bank president in three years.
Frederico Thomsen, a Buenos Aires-based economic consultant, said: “President Kirchner likes to be totally in control. Mr Prat-Gay is strongly opinionated but the government had managed to keep him under control while he was seeking his own mandate as central bank president.
“I think once Mr Kirchner heard his criticisms about the debt negotiations, he realised that he might be much more outspoken if he were reappointed.”
Esteban Fernández Medrano, a director at Buenos Aires-based economic consultancy Macrovision, said: “Argentina is well-known for its lax institutions, so I don’t think the change will have much impact on the international community’s opinion of the country. The new team in charge of the central bank is much more pro-Kirchner.”
The change at the central bank comes at a critical time in Argentina’s $100bn debt restructuring, which could be completed by the end of the year.
The government believes a deal with the 500,000 bond-holders should go ahead if 60% agree, while the IMF is pushing for an 80% limit.
