Argentina to borrow $15 billion to pay creditors
BUENOS AIRES, Argentina – Argentina aims to borrow $15 billion when it returns to debt markets so it can pay off international creditors who have sued it in a U.S. court, the government said.
The new market-friendly center-right government of Latin America’s third-biggest economy is seeking to settle a 15-year dispute over debts dating back to its 2001 default.
Its new U.S.-trained Economy Minister Alfonso Prat-Gay told reporters the government would issue $15 billion in new bonds to raise the amount it expects to pay off the creditors. That amount includes a $6.5 billion payment agreed in a deal this month between Argentina and some of the investors in the U.S. court case. The remainder of the cash raised by the bonds will be used to pay off various other creditors including bondholders who refused to join in that deal in the U.S. case.
“We estimate that we will pay $15 billion dollars” overall, Prat-Gay told reporters.
“That implies a reduction of about 40 percent in the interest” due on the original loans overall, he said.
The New York judge hearing the case brought against Argentina by the so-called “holdout” investors offered Argentina partial respite last week.
He agreed to lift an injunction that had blocked it from paying off other bondholders until it settled with the holdouts.
Argentina hopes that move will enable it to start borrowing again on capital markets so it can start clearing all its debts.
To do so, President Mauricio Macri’s government must repeal certain existing debt laws by passing reforms in a congress still dominated by his opponents.
Macri told AFP in an interview on Monday that he was confident he could gain a consensus by winning over “those who share our view that Argentina must end its conflicts, that it must come back to the world and gain access to financing.”
Since taking over as president in December from his leftist predecessor Cristina Kirchner, Macri has made it a priority to mend relations with foreign powers and investors.
Prat-Gay said the new bonds would be issued once the reforms were passed after congress reconvenes on March 1.
Argentina’s Finance Secretary Luis Caputo added: “All the banks we have spoken with are confident that we can raise the money we need on the market.”
You may be interested
Costa Rican immigration officials detained, released by NicaraguaAlejandro Zúñiga - November 20, 2018
A potentially tense international situation was resolved amicably Monday evening after two Costa Rican Immigration Administration officials were apparently detained…
This week in the Peace Corps: The Trodden Twins (Part 2)Zane H. and Alex H. / Peace Corps Volunteers - November 20, 2018
Identical twins Zane and Alex H. tell their stories of volunteering with the Peace Corps. Read Part 1 of this…
Thousands evacuated in Guatemala as volcano erupts, then stopsAFP - November 20, 2018
Guatemalan authorities declared a red alert and evacuated around 4,000 people Monday after the Fuego volcano erupted for the fifth…