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. Last Updated: 07/27/2016

Argentina Gets New Economy Chief

BUENOS AIRES, Argentina -- Argentina's president swore in the nation's sixth economy minister in a year Saturday, turning to former diplomat and trade expert Roberto Lavagna in a bid to turn around the crumbling economy.

Lavagna, a 60-year-old former ambassador to the European Union, took the key post in an elaborate ceremony capping a weeklong political crisis that threatened the caretaker government of President Eduardo Duhalde.

Lavagna replaced Jorge Remes Lenicov, a longtime Duhalde aide who resigned Tuesday after political support for his efforts to secure international aid and prop up the fragile banking system evaporated.

The new minister said he would hold meetings over the weekend and start forming a team of advisers, but offered no immediate proposals.

The government has said Lavagna's first task will be to "anchor" the peso to the dollar.

However during Saturday's meeting between Duhalde, Lavagna, the provincial governors and other officials, local television reported the new minister said the peso is to be left to float freely for now, saying the currency was unlikely to lose more value soon.

The Argentine currency has lost nearly 70 percent of its value since Duhalde abandoned its one-to-one peg to the dollar days after taking office in January. At the time, he insisted an overly strong peso was the cause of the Argentina's financial morass.

Mired in a four-year recession, Argentina defaulted in December on its $141 billion debt, and unemployment has exceeded 18 percent.

The departure of Remes Lenicov had raised doubts that Duhalde could keep his own government together.

Appointed by Congress on Jan. 1, Duhalde is slated to lead the country until September 2003 -- completing the term of Fernando de la Rua, who resigned in December amid protests and rioting over the persistent economic crisis.

Some critics have called for earlier elections, but Duhalde scoffed at that notion Saturday, calling it an "absurdity."

In comments broadcast on the radio earlier Saturday, Duhalde said he had the full support of Argentina's 23 provincial governors and other political forces to push ahead with efforts to turn the economy around.

"I've had a great deal of backing. During the crisis of the past week, the governors came out in support of me when called upon," said Duhalde, adding he expected his new team to begin restoring confidence.

He said more Cabinet changes were imminent, telling local news agency Noticias Argentinas that his minister of industrial production, Jose Mendiguren, would be departing.

Lavagna will immediately face pressure from international lenders for spending cuts. The International Monetary Fund is calling for reductions in spending as a precondition for new aid.

But such calls have been rejected by many Argentine politicians, who say that more austerity will only drive their country deeper into recession.

Lavagna is already under pressure to end a banking freeze that has severely limited access to savings accounts and provoked angry protests.