By Tom Gibb

Mr Kirchner wants to pay back debt only when the economy has recovered

IMF boss Horst Koehler has held his first meeting with the new Argentine president, Nestor Kirchner, who took office last month inheriting the worst economic crisis in the country's history.

This top level visit is aimed at starting negotiations to find a long term agreement for Argentina's debt crisis.

But that won't be easy. After defaulting on almost two thirds of its $140bn (�84bn) debt 18 months ago, Argentina was cut off from international credit.

There followed a year of reluctant government austerity measures during which the economy shrank by almost 11% and more than half the population were pushed below the poverty line.

Unpopular measures

Only in January did the IMF finally grant a $7bn short term deal which runs out in August.

The fund now wants further reforms before agreeing to a more long term rescheduling of Argentina's debt.

These include such potentially unpopular measures as allowing the banks to once again foreclose on the large number of Argentines unable to pay their mortgages.