Business Notes ARGENTINA

Just five months after Argentine President Carlos Saul Menem announced tough reforms to liberalize the national economy, his country may be on the verge of another financial collapse. After curbing inflation from a monthly rate of nearly 200% in July to 6.5% in November, Menem's program has hit several snags. Among them: the Peronist leader's failure to cut staff at any of Argentina's money-losing state enterprises and the resignations nearly three weeks ago of Central Bank President Egidio Ianella and Economy Minister Nestor Rapanelli and his deputy. The departures further weakened confidence in the economy. Argentina's currency, the austral, has plunged in value more than 50% against the U.S. dollar this past week, and experts guess consumer prices will jump about 50% for December.

Amid the uncertainty, a number of new reform proposals are being floated. One would replace the austral with the dollar, eliminating one major cause of inflation by depriving Menem's government of the ability to print money. For just that reason, not to mention outraged nationalistic sensibilities, the idea is sure to go nowhere.