June 18, 2015 / 1:17 PM / in 2 years

Scioli rival in Argentina primary said to step down

BUENOS AIRES (Reuters) - Daniel Scioli’s sole rival in the ruling party’s primary for Argentina’s presidential election has dropped out of the race, Cabinet chief Anibal Fernandez told reporters on Thursday.

Interior and Transport Minister Florencio Randazzo had planned to run against Buenos Aires Governor Scioli in the Front for Victory primary on Aug. 9.

No other rival has been announced, apparently making the primary a one-candidate event for the party ahead of the October general election. All parties and alliances are set to hold their primary contests on the same date.

Randazzo’s ambitions apparently cooled after Scioli earlier this week appeared to have won President Cristina Fernandez’s endorsement by appointing one of her closest advisors as his running mate.

“Florencio Randazzo stepped down from participating as a precandidate for president for the Front for Victory,” Anibal Fernandez said in his morning news conference.

The cabinet chief said later that he, Congressman Julian Dominguez and Fernando Espinoza, mayor of the Buenos Aires suburb of La Matanza, plan to run for governor of Buenos Aires province in the August Front for Victory primary.

The announcement knocked back rumors that Randazzo might run for governor should he bow out of the presidential race.

Argentine bonds fell on Wednesday after Scioli announced his choice of running mate, a decision some saw as a signal he would continue Fernandez’s interventionist and unorthodox policymaking if he won October’s election.

“The fears are that (the President) could still influence policy management with an insider who is a political maverick with radical views,” said Siobhan Morden at Jefferies.

Like many analysts, however, she cautioned this alliance might not continue after the election given Argentina’s “autocratic executive structure” and could just be a strategic ploy to win over Fernandez loyalists.

Among other issues, Fernandez is faulted by Wall Street for failing to put the country’s 2002 sovereign bond default to rest by reaching a deal with holders who rejected the steep cut in repayment terms offered in its debt restructurings.

She also introduced capital and trade controls that have scared off investors and hurt the economy, which is now suffering from stagflation with price rises in double digits.

Reporting by Eliana Raszewski; Writing by Sarah Marsh and Hugh Bronstein; Editing by W Simon and Andre Grenon

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