Argentina to pay debt as before US court ruling: Minister
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Argentina to pay debt as before US court ruling: Minister

Last Updated: Monday, August 26, 2013, 09:27
 
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Argentina to pay debt as before US court ruling: Minister
Buenos Aires: Argentina will continue repaying its debt on the same terms, the country's economy minister said today after Buenos Aires lost an appeal in a US court in its case against unhappy creditors.

On Friday, a US appeals court in New York ordered Buenos Aires to pay USD 1.47 billion to hedge funds holding its defaulted bonds, quashing an appeal by Buenos Aires against an initial 2012 judgment.

"We will continue to pay (the debt) as we have been until now, under the same terms," Economy Minister Hernan Lorenzino told state news agency Telam.

The ruling was "an attempt to bring the country back to the situation it was in in 2001," Lorenzino added.

Faced with bankruptcy in 2001, Argentina reached a deal with almost all of its private creditors to restructure its debt at a discount of nearly 70 percent in two phases, in 2005 and 2010, for a total of USD 90 billion.

"There are some who want Argentina to start going into debt again so as to see our people on their knees, but they won't succeed," the Lorenzino added.

In a case closely watched by financial and debt markets, the US court endorsed the original decision that Argentina must compensate two hedge funds 100 percent of the value of defaulted Argentine government bonds they hold, even though the two declined to take part in a restructuring of the debt.

Argentina had not made a convincing case that the Argentina will continue repaying its debt on the same terms, the country's economy minister said today after Buenos Aires lost an appeal in a US court in its case against unhappy creditors. Court had abused its discretion, the decision said, and had also not proposed a viable alternative way to settle the debts.

The funds in question are NML Capital and Aurelius.

Given that Buenos Aires had requested the US Supreme Court to weigh in on the case, the court added it would hold off on enforcing the decision to force Buenos Aires to repay the debts.

Buenos Aires has argued that bondholders who took part in the 2005 and 2010 restructuring of nearly USD 100 billion of defaulted debt, which forced on them huge writedowns of the face value of the bonds, would now be able to lay claim as well for 100 percent compensation.

That could overwhelm the country's finances and lead to a fresh default, Argentina has claimed.

AFP



First Published: Monday, August 26, 2013, 09:27


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