At midterm, Argentine leader faces host of problems. Economy key to Alfons'in's political support

By , Special to The Christian Science Monitor

Three years of democratic rule were completed earlier this month, marking a milestone in Argentina's long history of political turmoil and violence. But the milestone has not been reached without political cost for President Ra'ul Alfons'in. Halfway through his term of office, he finds his popularity flagging and opposition springing up from all quarters.

His human rights policy is a case in point. In his 1983 election campaign, Mr. Alfons'in made a pledge to the electorate that all those responsible for human rights abuses during the military dictatorship of 1976-83 would be brought to justice.

Now a bill is being pushed through the Argentine congress on the insistence of Alfons'in himself to put an end to further trials of military and police officials. Under the bill, all officials not formally indicted within 60 days of its passage will be exempt from prosecution. Critics of the bill, which was passed by the Senate Monday night and is expected to be rapidly approved in the Chamber of Deputies, see it as a betrayal.

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The punto final (full stop), as the bill is popularly called, is a result of pressure from the armed forces. An apparent attempt on Alfons'in's life in May during a visit to a military base and saber-rattling in the barracks have made it clear that the armed forces continue to exercise a powerful, albeit indirect, influence on Argentine politics.

Though he is faced with serious obstacles and has only three years left in his term, Alfons'in cannot yet be considered a lame-duck president. His achievements are undisputed and present him with opportunities on which he continues to capitalize.

He has restored the country to democracy and thrown a dozen top military and police chiefs behind bars for their role in the repressive ``dirty war'' of the 1970s. He has brought a dizzying annual inflation rate of over 1,000 percent under control; projections for 1987 are for a rate of only 40 percent. He has laid the foundations for a reorganization and modernization of the Argentine economy. His government has made major steps towards creating a customs union with Brazil, the economic giant to the north, and has kept the international financial system at bay by taking a conciliatory stance on service payments on the country's $50 billion foreign debt.

The government's active pursuit of these policies, however, has aroused the opposition. The nation's trade unions have mounted seven 24-hour general strikes in three years to protest the government's economic policy, and when the Southern Hemisphere's holiday season ends in March, the union banners will once again be unfurled along Buenos Aires' broad avenues. The CGT (Confederac'ion General de Trabajadores), the powerful general workers' federation, is implacably opposed to the recessionary economic strategy implicit in the government's Austral Plan and the conciliatory attitude taken to the foreign banks.

The goverment's economic advisers are confident of a new standby agreement being arranged with the International Monetary Fund in the coming two weeks, which would see the country through until the end of 1987. They are not so confident of being able to constrain the wage demands of the country's labor unions, however, or of keeping the economic strategy on track until 1989 and the next presidential elections. By-election results in outlying provinces of Argentina have been decidedly unfavorable to the ruling Radical Civic Union Party in past weeks.

If the government is to maintain its momentum over the next three years, its principal hope lies in maintaining economic growth. Here the growing economic ties with Brazil are key. In both countries there is increasing political pressure to divert foreign trade surpluses toward promoting internal growth instead of servicing the foreign debt. President Alfons'in told his colleague President Sarney of Brazil earlier this month that if Brazil declared a moratorium on its foreign debt, it could expect support from Argentina. Observers say such messages should not be taken too lightly.

The internal pressures on the nascent democracies in both countries are severe. The compromises being forced upon President Alfons'in are evidence of that. His image as a democrat representing a clear break with an authoritarian past remains almost intact. But he and his economic team are aware that Argentina cannot continue to pay the price for protectionist farm policies in Europe and the United States and the difficulties that these create for Argentina in servicing its foreign debt.

The punto final will buy some political breathing room for Alfons'in with the military. He still needs to strengthen his position with the rest of the population, however, if his party is to remain in power in 1989 and carry out the long-term structural reforms the country needs to make it into a modernized industrial state by the 21st century. That is Alfons'in's underlying goal, and he has shown no sign of giving up on that objective yet.

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