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Mon Aug 31, 2020, 06:10 PM

Argentina clinches near-unanimous backing for debt restructuring

Argentina has successfully restructured almost all of its $65 billion debt with private creditors in a major milestone that will enable the country to put an end to its ninth sovereign debt default.

Martin Guzmán, Argentina’s economy minister, announced on Monday that 99% of creditors had accepted his government’s offer, which extended maturities on the debt and lowered interest rate payments from an average of 7% to about 3%.

“May we never again enter this labyrinth [of indebtedness], please,” President Alberto Fernández said in a speech, flanked by regional governors and leading members of congress.

“Know that in 10 years’ time, in 2030, Argentina will owe $38 billion less than what we owed last year,” he added.

The debt exchange, which will enable creditors to swap their old U.S.-law bonds for new ones, puts an end to a tense and often acrimonious four-month-long negotiation process that appeared at times to be in danger of collapsing.

The Argentine government will now focus on restructuring its $70 billion debt with multilateral institutions - including $45 billion borrowed from the IMF in 2018-19 by right-wing President Mauricio Macri amid his failed re-election campaign.

Argentina's hard currency-denominated foreign debt tripled under Macri's 2015-19 administration to $250 billion.

At: https://www.ft.com/content/e3e8b783-9455-46f3-946f-15c31a29778b



Argentine President Alberto Fernández heads today's press conference in Buenos Aires, flanked by Vice President Cristina Kirchner and other officials and governors.

The refinancing agreement, reached August 4 but made official today, would allow Argentina to emerge from default, push most payments past 2025, save $38 billion in upcoming interest payments, and potentially re-enter global credit markets.

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