A deadline set for Argentina to reach an agreement with its international creditors to restructure its debt and avoid default fails to expire on Friday without making any formal announcement, but negotiations continue until May 22.
The left-of-center government led by Alberto Fernandez set this deadline in mid-April. Economy Minister Martin Guzman said only Friday that “part of our creditors accepted our offer and Argentina continues the dialogue.”
“The next bond maturity is May 22, and Argentina cannot be considered in default (unless the payment is made by that date,” Argentine political economy center director Hernan Leccher told AFP.
A senior government official told France Press, asking not to be identified, that Argentina had “ten difficult days” ahead of it, but the government “is optimistic because many say the offer is completely logical.” “We will do what we can (to find a solution) without mortgaging the present and future of the Argentines,” he added.
For her part, Director-General of the International Monetary Fund, Kristalina Georgieva, told reporters that “there is still time for ongoing negotiations.”
On April 22, Argentina defaulted on the payment of $ 500 million linked to its debt, noting a month-long amnesty period pending the creditors ’response to its offer.
The negotiations relate to the restructuring of $ 66 billion of bonds issued under international jurisdiction.
The Buenos Aires offer provides for 62 percent of its interest, or $ 37.9 billion, and 54 percent of the capital equivalent to $ 3.6 billion. Argentina also requests that the debt payment be suspended for three years, which means that no amount will be paid until 2023.
Three major groups holding the bonds have so far rejected the proposal, saying it incurred international creditors “asymmetric losses”.
Despite this rejection, the government maintained its offer. Guzmán said he was open to any counter-proposal, provided it respected “the limits of what is considered viable.” The Nobel economists, Joseph Stiglitz and Edmund Phelps, backed by more than 135 leading economists, on Wednesday called on Argentine creditors to accept the “responsible” government offer. “Debt relief is the only way to fight the Covid-19 epidemic and put the (Argentine) economy on a sustainable path,” they said.
Argentina has been in recession for two years, and on March 20, quarantine measures were imposed with the emergence of the new Corona virus in all countries.
This country in South America witnessed in 2001 the largest default in repayment of $ 100 billion in debt.
