Nov. 20 (Bloomberg) -- Argentina’s Interior Commerce Secretary Guillermo Moreno resigned after eight years of controlling prices and imports using strong-arm tactics that earned him a reputation as a bully.
Moreno will be economic attache at the Argentine Embassy in Italy starting Dec. 2, presidential spokesman Alfredo Scoccimarro said late yesterday in a televised broadcast from the government house. He didn’t say who will replace the most feared government official who once brought boxing gloves to a shareholders meeting to force Argentina’s demands.
Argentine President Cristina Fernandez de Kirchner reshuffled her cabinet Nov. 18, appointing Axel Kicillof as economy minister and Carlos Fabrega as central bank president on the first day that she resumed duties after a five-week medical leave. Fernandez also ousted her cabinet chief, replacing Juan Manuel Abal Medina with Chaco province governor Jorge Capitanich and appointed a new agriculture minister.
“The government is acknowledging that there is a problem in the macro-economy and that Moreno’s policies have failed to fix it,” Eduardo Hecker, a former market regulator who runs consulting firm DEL, said in a telephone interview from Buenos Aires. “It also shows that there was a political fight inside the inner circle that was won by Kicillof, who will became the most powerful economy minister from both Kirchner administrations as he has been the only one able to oust Moreno.”
Moreno didn’t reply to telephone calls to his office and an e-mail seeking comment. Jessica Rey, Kicillof’s press spokeswoman, didn’t reply to telephone calls seeking comment.
Argentina’s Merval 25 stock market index lauded Moreno’s departure with an intraday gain of as much as 4.4 percent.
Moreno, 58, was appointed in 2005 by Fernandez’s predecessor and late husband Nestor Kirchner who liked to say tongue in cheek that Moreno was as gentle as Lassie, the famed collie of movie and television. The comparison was made in August 2010 after Moreno brought boxing gloves to a Papel Prensa SA shareholders meeting to show he would fight the newsprint company controlled by Grupo Clarin SA. Shares of Argentina’s largest media group had an intraday gain of as much as 5.6 percent.
Former President Kirchner appointed Moreno in a bid to slow the country’s accelerating inflation. The government chose to replace senior officials at the statistics agency, or INDEC, in 2007. In 2010, Moreno fined more than a dozen research companies 500,000 pesos ($86,000) each for reporting inflation was more than double the government’s official rate.
Opposition lawmakers began to publish consumer price estimates by private economists to protect their identities. In February, the International Monetary Fund censured Argentina for failing to report accurate inflation data. IMF Managing Director Christine Lagarde said Nov. 11 that Argentina was making progress after the censure.
On Sept. 17, a federal court charged Moreno with abuse of authority for fining private consulting firms. Federal Judge Claudio Bonadio froze 50,000 pesos worth of Moreno’s assets.
Still, Moreno’s annual income increased by 26 percent to 2.26 million pesos from 1.79 million in the prior year, according to a filing with the anticorruption body disclosed yesterday. In his portfolio he owns shares of YPF SA as well as Argentine government and provincial government bonds.
Moreno recently met with industry groups from electronics to miners in an attempt to convince companies to bring dollars into the economy to invest in government bonds, whose proceeds will go toward energy projects.
He also led talks with grain exporters asking them to buy $500 million of government bonds known as BAADE that could be swapped back into cash at a favorable exchange rate leveraging his power to authorize corn and wheat export permits.
Moreno was in charge of controlling imports and exports to ensure the nation maintains a trade surplus and reportedly called currency trading houses personally to attempt to lower the black market currency rate. The widening gap between the official exchange rate of 6.04 pesos per dollar and a black market rate, known as the blue rate, where Argentines pay as much as 10 pesos to obtain foreign currency, stem from currency restrictions imposed since Fernandez’s re-election in 2011.
Newcomers to the cabinet will be sworn in today at the presidential house. During her absence, Fernandez’s party lost the mid-term election in the critical Buenos Aires province, the largest electoral district in Argentina.
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