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BUENOS AIRES, Argentina – President Cristina Fernández de Kirchner fired Martín Redrado, Argentina’s central bank president, through an official “Necessary and Urgent Decree” (NUD) last week. But a judge has since reversed the president’s decision and reinstated Redrado.
During a meeting at the presidential residency, Cristina Fernández de Kirchner told her cabinet members: “Please fix this scandal that you have created for me as soon as possible,” according to a report by the newspaper La Nación.
The conflict began on Dec. 14 when Redrado refused to give about US$6.5 billion of the bank’s US$48 billion reserve to the newly created Bicentennial Fund for Economic Stability & Reduced Indebtedness, according to Amando Boudou, the secretary of the economy.
“The Bicentennial fund is a US$6.5 billion fund that represents 14% of the central bank’s total reserves and was created to put an end to external debt during 2010,” said Andrés Gravin, an analyst from Estructuras y Mandatos, one of the leading financial companies in Argentina.
The same day the opposition party learned of Fernández de Kirchner’s desire to use the bank’s reserves, they threatened to ask a federal judge to stop her request.
Ernesto Sanz, leader of the UCR (Radical Civic Union), the most important opposition party in Argentina, said allocating a portion of the reserves for the bicentennial fund was “irresponsible” and asked Redrado to deny Fernández de Kirchner’s request, according to a report by the news agency Télam.
The conflict escalated on Jan. 6 when Aníbal Fernández, the president’s chief of staff, informed Redrado that Fernández de Kirchner demanded his resignation through an official decree.
But Redrado appealed the presidential measure before the federal court and supported his claim with the central bank’s code, which stipulates that “the president of the bank shall only be removed of his charge by order of congress.”
Judge María José Sarmiento accepted his appeal and reinstated him.
This is not the first time Sarmiento ruled against the president. Hours before, she opposed the decree that called for the creation of the bicentennial fund, which was to be financed by the central bank.
Sarmiento explained to the media over the weekend that she felt pressure from Fernández de Kirchner’s administration. She told the TN (Todo Noticias) news channel there were policemen at her door all morning.
“I know this is an important institutional crisis, but what I don’t understand is the process,” she said. “I have never, in my 30 years in federal court, seen anything like this.”
Aníbal Fernández said the government had requested the federal police to look for the judge because they had been unable to locate her. The government felt the judge needed to give the Fernández de Kirchner’s administration “the same opportunities that she gave to Redrado” to defend its case against him.
Argentine constitution expert Gregorio Badeni, Redrado’s lawyer, referred to the swiftness of the Redrado’s reinstatement as “very reasonable.”
“The president [of the central bank] has returned to his duties,” Badeni is quoted as saying in the newspaper Crítica de la Argentina. “The executive power cannot ignore this decision because we are under rule of law. If the government doesn’t like the ruling, there are appropriate mechanisms in the courts to appeal them.”
So on Jan. 11, like every morning since taking office in 2004, Redrado arrived at work and resumed his position, which had been held temporarily by Miguel Pesce, who had been the bank’s vice president.