Serial Defaulter Argentina and the IMF: Another in the Works?

A different outcome may still be possible, a leading emerging-market economist writes. The seeds for the latest chapter in Argentina’s long history of confrontations with the International Monetary Fund were planted about a year ago, on the eve of the global pandemic. President Alberto Fernández and Economy Minister Martín Guzmán were putting the finishing touches on a proposal for major debt relief from the government’s bondholders at home and abroad. Fernández had come into office in December…

Is Anyone Crazy Enough to Lend to the Argentina government?

In June 2017 Argentina sold US$2.75 billion of 100-year bonds and I wrote then that “Argentina is unlikely to get through a decade without defaulting let alone 100 years”. It wasn’t a particularly radical call for a country that had defaulted four times in the previous 35 years. In August 2019 Argentina announced it planned to default and was seeking talks with its lenders to restructure its debts, sending the price of its bonds plummeting. This week Argentina struck a deal to restructure its debts on…

One Country, Nine Defaults: Argentina Is Caught in a Vicious Cycle

At midnight Saturday, after months of histrionics, the clock ran out on Argentina. It had failed to put up the $500 million it owed foreign bondholders and, in so doing, had fallen into default for the ninth time in its history. It’s a staggering number, putting the South American country in an elite league of serial defaulters that includes the likes of Ecuador, Uruguay and Turkey. The first episode came in 1827, just 11 years after independence. The last three came rapid-fire, one after another, in…

Argentina Pockets $35 Billion Windfall After Accounting sleight of hand

Argentina may be in deep financial trouble but its central bank is comfortably back in the black — thanks to a smoke and mirrors accounting manoeuvre. A little-noticed decision by policymakers late last year to change the way they value government bond holdings transformed the central bank’s balance sheet overnight, turning what had been a net worth of negative $2 billion into positive $33 billion. Officials have made little effort to explain the move — they just say it’s part of a wide-ranging…
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