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Argentina has reached an agreement to prevent another damaging wealth by delaying most of the $ 2.4 billion payment owed to a group of rich countries, Economy Minister Martín Guzmán said on Tuesday in late July.
Argentina now has until the end of March to reach an agreement The so-called Paris Club From 22 countries, including the US, Germany, Japan and France.
Guzman said Argentina is only paying $ 430 million in two installments, the first by July 31, when the 60-day deadline for payments of $ 2.4 million, initially due on May 30, ends. Guzman said the deal would effectively save the country $ 2 billion over the next eight months.
The agreement will give some respite to the Argentine economy’s struggle, despite the fact that many foreign exchange reserves have been depleted in recent months as a rise in commodity prices has received a boost.
“Solving the problem of our unsustainable debt is a fundamental pillar of the process of restoring stability in the economy,” Guzman said at a press conference in Buenos Aires. He said annual inflation is also helping at almost 49%.
An agreement is reached with the Paris Club negotiations The FNM has been left to repay the $ 45 billion it has lent to Argentina since the 2018 currency crisis in Mauricio Macri’s previous government.
Local analysts say talks with the NDF have stalled due to political considerations, and midterm elections are due in November because the government will not want the difficult budget cuts agreed with the multilateral loan.
Although Argentina was initially expected to reach an agreement with the IMF last year – shortly after a successful $ 65 billion restructuring it owed to private creditors – it has been hampered by the lack of an agreement to reduce the country’s severe fiscal deficit. Talks with the Paris Club.
“Paying that amount would be a blow to international reserves and create greater instability in the exchange rate and macroeconomics in general,” Guzman said, adding that the default would cause greater economic instability and uncertainty.
Guzman clarified that the government will continue its “constructive” dialogue with the NDF, and that the March deadline with the Paris Club “has nothing to do with the goal of reaching an agreement with the NDF. Our goal is to get a good agreement as soon as possible, but a good priority.”
The 38-year-old minister added that another key element of the agreement with the Paris Club was that Argentina would treat its creditors equally, as Japan was paying its debts to China with China to allay concerns, but not with the Paris Club.
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