Argentina extends talks with creditors
Saturday – 30 Ramadan 1441 AH – 23 May 2020 AD No. No. [
Announce the extension of the debt restructuring talks between Argentina and its creditors until June 2 (Reuters)
Buenos Aires: «Middle East»
Argentina’s Finance Ministry confirmed that debt restructuring talks with its creditors were extended until June 2. It was scheduled to end on Friday, the deadline for restructuring 65 billion dollars of foreign debt of Argentina, after it was extended earlier.
The Clarin newspaper and other media said that the government would not pay $ 503 million in bond-interest service that was due by Friday, and technically it would continue to “default slightly” as the talks continued.
The International Monetary Fund said earlier Thursday evening that it hoped to reach an agreement. “We were encouraged by the preparations of both sides to continue the talks,” spokesman Jerry Rice said in a video posted to his account on Twitter.
Failure to reach an agreement will result in Argentina’s ninth default, and threatens to bankrupt the country. Creditors rejected Argentina’s offer, which included a three-year moratorium, a cut in interest payments by 62 percent, and a 5.4 percent reduction in major payments.
The Argentine government announced last Friday that it had received three new counter-offerings from creditors regarding the rescheduling of its debt, days after Argentina extended the deadline for its debt restructuring deal to May 22 (May). Finance Minister Martin Guzman said he would study the offers with his team and financial advisors.
He continued in a video conference organized by the Council on Foreign Relations: “We want to find a sustainable solution to the debt problem, and a healthy and lasting relationship with our creditors.” “If there are other sensible ideas and taking into account our limited capabilities, we are happy to hear them,” he added, without disclosing details of the offers.
South America’s second largest economy was already facing a severe crisis, before the Covid-19 epidemic. Inflation is more than 50 percent, and the International Monetary Fund predicts that the economy will contract by 5.7 percent this year.
Argentina suffers from a flabby government apparatus, low industrial productivity, and a large shadow economy that deprives the country of tax revenues.