The final countdown

3 June 2020 By Anna Szymanski Follow @Three_Guineas

The nine-time defaulter and its creditors are nearing a $65 bln restructuring deal. It might not seem fair for Argentina to give more ground, especially when it has IMF support. It can’t risk being frozen out of global capital markets, though. Playing tough could backfire.

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Argentina is reworking a proposal to restructure $65 billion in foreign debt, after it defaulted for the ninth time in May.

The Latin American country released some financial parameters for a new proposal on May 28. On June 1, it extended the deadline for creditors to submit orders to exchange eligible bonds for new instruments to June 12. Reuters reported on June 3 that creditors expect to get the new offer in a few days.

The International Monetary Fund said on June 1 that the government’s modified terms would still make their debt sustainable, and it said the country only has limited space to improve the offer.

The Argentine Exchange Bondholder Group and the Ad Hoc Argentine Bondholder Group submitted a joint restructuring proposal to Argentina on May 27. The proposal is supported by creditors who collectively hold more than 30% of outstanding Exchange Bonds and outstanding Global Bonds.

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