Creditors back Argentina’s debt restricting

BUENOS AIRES (AFP) – Recession-hit Argentina has managed to restructure 99 per cent of USD66 billion in debt issued under foreign legislation, Economy Minister Martin Guzman announced on Monday.

The news comes approximately a month after Argentina reached an agreement with three major creditor groups to renegotiate the terms of the debt following months of strained talks and several missed deadlines.

“There has been massive acceptance, thanks to the dialogue process,” said Guzman, speaking alongside President Alberto Fernandez and Vice President Cristina Kirchner.

Guzman said that the deal meant Argentina would benefit from USD37.7 billion in debt relief while its annual interest rate will drop from seven per cent to three per cent.

“This gives us a sufficient economic timeframe to generate sustainable policies and allow development,” said Guzman.

The high acceptance rate also lifts the spectre of litigation by speculative funds, which have successfully sued the country in the past.

“We’ve come out of the labyrinth,” said Fernandez. “We don’t want to condemn any more Argentines to grovelling.”

As for the remaining one per cent, “this debt will surely be paid”, said Matias Rajnerman, an analyst at Ecolatina. “It’s very little money, USD600 million. For Argentina it’s practically nothing.”

The deal is worth 54.8 cents on the dollar, a significant increase on the original offer of 39 cents.