Weekly Report - 18 May 2004

ARGENTINA | New taxes to fund energy rescue. The government has announced a series of increases in taxes on exports of oil and gas, plus the introduction of a new tax on refined fuels, in order to fund a scheme to rescue Argentina from its current energy squeeze. Exports of crude will now pay 25% (up five points) and those of liquefied gas, 20% (up 15 points). Exports of fuels, hitherto untaxed, will pay 5%. President Néstor Kirchner described this as `an act of justice' since the crisis was due to the energy companies `preferring to export [in the 1990s] rather than invest, because it was more profitable'.