Menem set to surrender in poll fight

Argentina's former president, Carlos Menem, was last night on the brink of throwing in the towel on his re-election bid, as aides admitted that he was ready to withdraw from this Sunday's run-off vote.

Mr Menem, 72, was expected to announce his decision this morning, after opinion polls showed he would suffer a humiliating defeat in the second round vote against Nestor Kirchner, a fellow Peronist and a regional governor.

Mr Menem, who ruled Argentina for a decade in the 1990s, but whose policies then have since been blamed for the country's spectacular economic decline, narrowly defeated Mr Kirchner last month.

But the extrovert veteran with a taste for young television starlets and expensive Italian sports cars, quickly slumped in polls for the run-off, which predicted a 63% vote for Mr Kirchner.

Such a result would have constituted Mr Menem's first electoral defeat. Some aides had suggested it would be better to avoid such a humiliation, but not all agreed.

"I'm highly critical of the decision," said a top aide, Diego Guelar, a former ambassador to the United States.

Mr Kirchner's aides soberly anticipated the capitulation of their rival. "It is time to bury old ghosts from the past," one said, although tacitly officials realise that the move will deprive Mr Kirchner of a strong election win which would have strengthened his legitimacy to lead Argentina through troubled times.

Mr Menem's withdrawal would almost certainly spell the end of a colourful political career. He first rose to national prominence as a protegé of his party's founder, General Juan Peron, back in the early 1970s, when sporting shoulder-length hair and bushy side-whiskers, he became the young governor of his northern province of La Rioja.

Arrested in the bloody military coup of 1976, he went back into politics after the return of democracy in 1983, and won the presidential elections of 1989, causing panic among Argentina's bankers and businessmen who feared his populist leanings.

But once in office, in an amazing about-face, he implemented a strict free market economic programme, selling off state-owned companies and dismantling the tariff barriers that had for decades kept Argentina a closed economy.

The spectacular first-term economic growth made him wildly popular, but the high unemployment and deep recession that followed his re-election seemed to spell the end of his political career when he left office in 1999.

Argentina's economic and political trials in the last two years, including the country's default on its massive foreign debt and the bizarre succession of presidents in December 2001, breathed new life into his political ambitions.

Argentinians began to wish for the return of the boom days of his first presidency, and the candidate won 24% of the vote in the first round on April 27.

But in the run-up to Sunday's second round, despite intense campaigning and a massive media campaign, Mr Menem was unable to increase his numbers in the opinion polls, while Mr Kirchner was able to win over voters of other candidates.

His resignation also ended Mr Menem's long-cherished dream of matching the record of his party's founder General Peron, who won the Argentinian presidency three times.