Julio de Vido
PEOPLE PROFILE is published every Tuesday and describes the professional background of key people emerging in the political and economic scenario.
Who is Julio de Vido?
He is the federal minister of planning, public investment and services in Argentina.
He is a close friend of the President, Néstor Kirchner. Arguably, de
Vido is the second most powerful man in the government.
Why watch him?
Argentina is likely to default on a US$3.1bn payment to the IMF today. In eyes
of most analysts, de Vido has stiffened Kirchner into taking the tough line
with the IMF, refusing to meet its demands. De Vido's so-called plan B is for
a virtual siege economy. In this, payments to all multilaterals will be halted.
Argentina has already halted payments to its commercial creditors. The idea
is that any money that comes in will be used to boost the domestic economy.
The file
Place of birth: Santa Cruz, Argentina.
Education: He is a qualified architect.
Public life:
He was a minister in the provincial government of Santa Cruz when President
Kirchner was governor. Santa Cruz is rich in hydrocarbons but remote: it is
in Patagonia.
Timeline
1990-2003: De Vido turned himself into Kirchner's right-hand man in
Santa Cruz. When Kirchner decided to run for the presidency, he left de Vido
in charge of things in Santa Cruz.
2003: In the election campaign de Vido was summoned to become one of
Kirchner's key advisers.
2003: President Kirchner created the new ministry for de Vido. The ministry's
brief is to increase public investment, especially in the provinces, which was
one of Kirchner's campaign themes.
2003: On taking office, de Vido has tried to boost public investment.
He produces Neo-Keynesian arguments to justify this. This policy has been opposed
by the economy minister Roberto Lavagna, who is both more orthodox and has a
prior loyalty to Eduardo Duhalde, who appointed him during his caretaker presidency.
2004: This year the main dispute between de Vido and Lavagna has been
over privatisation. De Vido does not want to allow privatised companies to increase
their charges. He also wants their contracts rewritten. All this is anathema
to Lavagna and the IMF.
2004: As the deadline for the payment to the IMF draws closer, de Vido
hardens his position. He argues that Argentina should take a dignified position
and split with the IMF.
Strong points:
His strongest card is his close friendship with the president. His Neo-Keynesianism
is also popular with Kirchner and others who want the state to play a role in
the economy. This outlook is very different from the neo-liberal Washington
Consensus which dominated Latin America in the 1990s. The essence of de Vido's
Neo-Keynesianism is public investment, which he hopes will kickstart the economy.
Weak points:
He is not well known internationally and has few allies in the multilaterals.
He is also prone to square up to big private sector companies. So far Kirchner
has been able to smooth things over. If Argentina does break with the IMF, it
will be another triumph for de Vido, but will come in the teeth of opposition
from the economic and business establishment.
Prospects:
If Argentina does break with the Fund by not paying up today, it is hard to
believe that this will be the end of story. Argentina has gone over the brink
several times before but always managed, eventually, to scramble back and grab
the IMF's proffered help. Most commentators see the brinkmanship as a negotiating
tactic. In this view, what Argentina wants to do is to put pressure on the IMF
to relax its economic targets for 2005 and 2006. These negotiations will start
in September.