Guest view: Consider a debt for vaccines program 9 Mar 2021 Such plans may help reduce currency mismatches in jab distribution, reduce the need for “new money” and avoid overloading balance sheets with unsustainable pre-existing debt. Epidemiologist Cristina Valencia and banker William Rhodes argue for piloting the idea in Latin America.
Argentina’s creditors made two silly mistakes 28 Oct 2020 Some investors say their newly restructured bonds have tanked due to President Fernandez’s lousy policies. They’re right. But they’re shouting in the wind, because they agreed to a debt rejig based on unenforceable promises, and gave up what leverage they had in the process.
Guest view: Latin America has a Covid-19 cash gap 16 Oct 2020 Economic weakness has helped make the region’s health crisis one of the world’s worst, write former Citibank Chairman William Rhodes and epidemiologist Cristina Valencia. Even if a vaccine arrives, the recovery will demand more direct funding from the international community.
Argentina’s debt victory lap is way too early 1 Sep 2020 Buenos Aires is crowing about getting 99% approval for its $65 bln restructuring deal. It’s a good first step, but it should have been easier. Negotiating a realistic reform plan with the IMF will be tricky, and balancing growth and stability in the future will be harder still.
IMF worsened Argentina debt fiasco 6 Aug 2020 The lender couldn't prevent another restructuring and may have added to the rancor. An ill-conceived $44 bln deal with the prior president was the tipoff. And the IMF's premature release of debt projections enabled posturing. Ivory-tower hubris is partly to blame.
Ecuador is willing pawn in Argentina debt standoff 20 Jul 2020 Quito will tweak voting rules in its $17.4 bln restructuring, helping creditors pressure the larger LatAm debtor to do likewise. It’s an easy change to make and would still help emerging-market borrowers avoid being held to ransom in the future. Buenos Aires should take the hint.
Argentina remains the bad boy of sovereign debt 14 Jul 2020 The serial defaulter’s new restructuring proposal offers creditors decent value – but only after months of off-the-charts acrimony. Creditors were a tough bunch to please, but the government’s strategy stymied progress. The country can’t get out of its own way.
Argentina drama comes down to politics and Pac-Man 22 Jun 2020 Talks between the serial defaulter and its largest creditor group have stalled. The remaining gap is not huge. But the government seems intent on scoring a political win and may deploy an unusual strategy to do it. Rising frustrations may make an agreement hard to reach.
Argentina gets too cheeky with its creditors 8 Jun 2020 The serial defaulter wants to put its restructuring to a creditor vote, but leave room to decide later which votes count and which don’t. That would require a tweak to a common clause designed to make bond negotiations simpler. Emerging-market borrowers would be worse off for it.
Argentina’s whiz kid may flunk restructuring test 7 May 2020 Martin Guzman, the 37-year-old economy minister, is trying to get a deal with holders of over $65 bln of debt using academic theories about what's sustainable. He makes valid points but the clock is ticking before default. Pragmatism is needed – otherwise it may tick for him too.
Argentina overplays hand in bond pain déjà vu 20 Apr 2020 BlackRock and other creditors have come out against the serial defaulter’s plan to restructure some $66 bln in debt. New legal protections should help their cause, and a messy default could attract holdouts. But time is their biggest advantage: Argentina needs money.
IMF’s $44 bln error in Argentina calls for haircut 24 Feb 2020 The international lender now says the serial defaulter’s debt burden – near 90% of GDP – is unsustainable and that private creditors will have to take a hit. It’s right on both counts. But it also fumbled this bailout badly. In such an exceptional case, it should share the pain.
Buenos Aires dares bondholders to game of chicken 27 Jan 2020 Creditors vote this week on the province’s bid to delay a $250 mln debt payment. Opponents can argue the delay is unneeded and would complicate restructuring Argentina’s sovereign bonds. But they don’t have much leverage. And investors’ short memories give Buenos Aires an edge.
Argentina debt do-over is even chancier than usual 3 Jan 2020 The country will need to restructure at least $100 bln of its borrowings, not just tweak terms as the Fernandez government favors. The novel features attached to Argentine debt after its last default may bring unexpected twists. The results will shape future sovereign debt deals.
Argentine handover is chance for IMF LatAm rebrand 10 Dec 2019 The unloved lender, $45 bln on the hook, now has to deal with new President Alberto Fernandez and his austerity-critic economy minister, Martin Guzman. The IMF needs a reboot across the region. Accepting political realities and updating failed prescriptions would be a good start.
Macri’s likely defeat a warning to LatAm reformers 25 Oct 2019 Argentines are expected to oust would-be reformer Mauricio Macri in Sunday’s elections, which follow weeks of violent protests across the region. In the post-commodity-boom era, Latin American reformers need to find a new identity that is neither leftist nor too austere.
Viewsroom: WeWork’s future may lie in China’s past 24 Oct 2019 Beijing-based Kr Space switched from renting out space held on long-term leases to selling services after the shared-office market crashed. Following suit may help WeWork stem losses. Also: climate change and Canada’s election. Plus: the gloomy IMF and unrest in Latin America.
Argentina’s FX rift reflects its two-Macri problem 30 Sep 2019 The offshore peso rate has diverged 15% from the official rate, suggesting markets have lost faith with President Mauricio Macri. Political realities may explain why he promised one thing and delivered another. Future reformers may receive a greater degree of investor skepticism.
Argentina debt flashback includes glimmer of hope 29 Aug 2019 President Mauricio Macri wants to restructure the country’s borrowings as his four-year effort to restore its economy and market standing nears an end. History warns against optimism, but the move could give his likely successor some breathing room – if he doesn’t squander it.
Argentines lose patience with economy and Macri 12 Aug 2019 The president’s populist rival easily won Sunday’s primary vote. Shrinking GDP, 55% inflation and a sliding peso are all Macri has to show for his reform efforts and $44 bln of IMF help. With elections in October, his investor-friendly policies may have run out of time to work.