Political Risk Latin America Blog @PolRiskLatam

Argentina/Paris Club debt negotiations have a deadline: April 2011

Posted in News and Articles, Political Risk by politicalrisklatam on November 19, 2010

by Merco Press News, November 18th, 2010.

Finance Secretary Hernán Lorenzino said Argentina wants to successfully conclude negotiations with the Paris Club Group of creditor nations involving 6.7 to 8 billion US dollars in defaulted debt before April.

Lorenzino added that Economy Minister Amado Boudou “will seek to agree on a negotiating road map with the Paris Club in the first half of December.” According to Lorenzino, a resolution of the debt with the Paris Club, which includes Germany, Japan and the US among 19 developed countries, would remove a ‘main obstacle’ to investment by companies in Argentina’s energy and infrastructure.

However the agreement with the Paris Club must be reached before April 16, 2011, when the IMF holds its autumn meeting and the multilateral organization is scheduled to debate the Argentine case and its refusal to comply with Article IV consultations, which are conducted annually in each of the Fund’s 186 member countries.

Argentina has refused to submit its economic data since 2006, when former president Néstor Kirchner paid off the country’s debt to the IMF. According to Dominique Strauss-Kahn, the IMF managing director, if Argentina fails to comply with the IMF periodic reviews by then, the organization could impose sanctions on the country, which could lose its membership in the Board of Governors, the IMF highest decision-making body. (continue reading… )


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