LatinNews Daily - 06 August 2020 |
ARGENTINA: Local debt-restructuring bill approved by landslide |
On 4 August, Argentina’s chamber of deputies gave final approval to a bill for the restructuring of the US dollar-denominated sovereign debt issued under domestic law. Analysis: The vote came after Argentina confirmed it had reached a much-celebrated accord with private bondholders over the restructuring of some US$66bn of debt issued under international law. The broad cross-party support for the bill yesterday appears to dispel any doubts over whether the foreign-law debt restructuring agreement will be approved once it is put to the legislature. It likewise bodes well for congressional backing for the outcome of the upcoming debt negotiations with the International Monetary Fund (IMF), although such negotiations will typically revive historical tensions between the IMF and the more hard-line members of the ruling Partido Justicialista (PJ, Peronists).
Looking Ahead: Argentina has set a deadline of 24 August to formalise the agreement with international bondholders. The agreement will then have to be approved by the legislature. Following this process, Argentina will turn its sights to reprofiling its US$44bn debt with the IMF. |