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LatinNews Daily - 18 September 2018

Fernández corruption charge could impact Macri in Argentina

Development: On 17 September Argentina’s former president, Cristina Fernández (2007-2015), was charged with leading a corruption network linked to the award of public works contracts.

Significance: Ordinarily the mounting legal travails of his main political rival would provide some comfort for President Mauricio Macri. But long gone are the days when Fernández’s legal predicament could be seen as giving him an unimpeded run to re-election in October next year. Indeed, there is a danger that the political rumpus that the latest charges could cause might complicate the congressional passage of his draft budget for 2019 which he needs to see approved as quickly as possible to mitigate the economic and financial difficulties facing his government.

  • Judge Claudio Bonadio formally accused Fernández (along with her late predecessor Néstor Kirchner [2003-2007]) of leading “a criminal organisation, comprising public officials” which had extorted large sums of money from businessmen in exchange for public works contracts.
  • Bonadio, who has also accused Fernández of corruption in several other cases, called for the former president’s preventive detention. In practical terms, this does not mean a great deal as the federal senate, controlled by the main opposition Partido Justicialista (PJ, Peronists), has already made clear that it will not strip Fernández of her immunity as a senator in order to face prosecution despite the party’s differences with her.
  • The timing of Bonadio’s latest corruption charge against Fernández is a cause for concern for President Macri, however, as it could provoke tensions with the PJ just as his government has submitted the draft budget to congress. Approval of the budget is essential if his government is to stand any chance of erasing the fiscal deficit next year and securing early release of its US$50bn Stand-By Arrangement (SBA) with the International Monetary Fund (IMF).

Looking ahead: Corruption charges will keep coming at Fernández. Macri will hope the latest charges will not undo all the hard work he has put in to try and smooth the way for the 2019 budget by courting (principally Peronist) provincial governors, who hold significant influence over senators.

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