AArgentina is still not responding to the improved offer of creditors, who should waive part of their claims of 65 billion euros. Instead, the government in Buenos Aires is once again relying on the help of the International Monetary Fund (IMF). Economics Minister Martín Guzmán has now announced plans to launch a new IMF program regardless of debt negotiations with creditors.
The deadline in the debt dispute ends on August 4, i.e. on Tuesday of the coming week. At the weekend, the Argentine government had the creditors flashed off with their improved offer. Now the ninth state bankruptcy in the history of the South American country threatens.
No further concessions
Most recently, creditors, including large investment firms like Blackrock and Fidelity, had asked for higher government bond interest rates and changes to some contract terms. However, the Argentine government is sticking to its latest offer and is not prepared to make any further concessions. Media reports show that the offers should not be far apart.
The Argentine economy has been hit hard by the Corona crisis. This also explains why the Ministry of Economic Affairs very emotionally rejected the offer from the creditors: “That would not only be irresponsible, but also unfair. While 50 percent of children in Argentina live in poverty, we cannot increase the short-term profits of our creditors. ”
Argentina is in a serious financial and economic crisis. The inflation rate was more than 50 percent recently. Experts expect the economy to decline by 12 percent this year. At the end of May, Argentina had failed to pay $ 503 million in interest claims, causing it to slide into a limited default. Guzmán had said in May that Argentina could not continue to spend 20 percent of its government revenue on interest payments, especially in times of virus. The IMF has described the country’s debt burden as unsustainable. Argentina has a total debt of $ 323 billion at the end of 2019.