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No U.S. Help For Argentina

President Bush, British Prime Minister Tony Blair and Spanish Prime Minister Jose Maria Aznar agreed Friday that they supported Argentina's financial reforms but that the focus should remain on a current IMF plan for Argentina, the White House said.

The comments indicated there was little support among the leaders for new money for Argentina.

White House spokesman Ari Fleischer told reporters Mr. Bush had spoken with the two leaders on the telephone.

"They reiterated to President Bush that they are behind (Argentine) President (Fernando) de la Rua's policy. President Bush stated the same, and they all agreed that the focus should remain on implementation of the current IMF package for Argentina," Fleischer said.

Argentina, whose economy has been mired in a three-year recession and is struggling to meet payments on $130 billion in foreign debt, has some $7 billion in IMF resources available to it under an existing loan program.

There have been reports Argentina may request a bigger loan.

Argentina eagerly awaited the visit of U.S. Treasury official John Taylor in the hope strong Washington support for its drastic savings plan will quash snowballing debt default fears.

Optimism that the trip by the Treasury's undersecretary for international affairs could accelerate or even augment credits from aid bodies boosted Argentine government bonds in European trading. Argentina's benchmark 2008 global dollar bond climbed 2.77 percent to 60.375 points.

"They are coming with the idea of studying the case with the specific aim of seeing what the fundamental policy of the United States will be, especially regarding the international aid bodies," said Argentine Finance Secretary Daniel Marx.

Earlier in the week, concerns about the steady exit of bank deposits and reserves by nervous Argentine savers pushed down the bond to near record closing levels and country-risk — the premium investors demand for buying Argentine bonds rather than safe-haven U.S. Treasuries — touched 1,700 points.

Early Friday it had narrowed to 1,520 points - better, but still higher than countries with a recent default history like Ecuador and Russia.

The debilitated center-left government has eased its debt payment schedules with a huge $29.5 billion debt swap and got Congress and provincial governors to back the unpopular package of hefty cutbacks for state workers and pensioners.

When the bill's approval over the weekend was followed by further selling this week, the government accused "speculators" of betting on default and devaluation, and talking down the market to defend their short positions in Argentine bonds.

Ex-U.S. Treasury Secretary Nicholas Brady, who led a Latin American debt rescue package in the early 1990s, accused Wall Street of "grave dancing." But investors said they had yet to be convinced Argentina would fulfill its fiscal promises.

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