Monday, February 29, 2016

Government debt – Argentina agrees with hedge funds – Sü

  • Argentina agrees after years of dispute with four US hedge funds to a billion payment
  • Parliament needs the deal but still agree -.. And there has President Macri no majority
  • the dispute revolves around old Argentina’s debt from the period before the state bankruptcy in of 2002.

Argentina’s new government has agreed with US hedge funds to the payment of a billion amount. President Mauricio Macri wants to put a line under a debt dispute that has lasted for more than a decade and has precipitated the country’s ambiguous fame: In the international financial Argentina was considered a pariah, with critics of finance capitalism, however it acquired through his tenacious opposition a kind of hero status , It is now past: Argentina was willing to hedge fund NML Capital, Aurelius and two other funds to pay 4.65 billion US dollars, said the promoter used in the dispute Daniel Pollack on Monday in New York with. That’s 75 percent of the originally requested sum. The agreement in principle was reached accordingly on Sunday evening.

Parliament must approve the deal still

According to Pollack you have thus a “giant step” done to end this historic conflict. But the controversy is not over yet, he was going in the “final stage”. The agreement still has to be approved by the Argentine Parliament. That could be difficult, as the new president there has no majority. The liberal-conservative Macri negotiated for days feverishly with Linksperonisten and tried abzulocken them a consent with all sorts of promises.

The dispute dates back to the turn of the millennium, when Argentina lay off national bankruptcy. Hedge funds bought back then – in simple terms – Argentinian junk bonds and insisted later, after the recovery of the country, to the nominal value of government bonds – which would have meant huge profits. The Argentine President Cristina Fernández de Kirchner who officiated from 2007 to 2015, refused to pay the hedge funds, referred to them as “vulture funds” and financial terrorists who are trying to plunder Argentina.

Behind course put even that Argentina simply could not afford the payment. The country has since its bankruptcy in 2002, when it was unable to service $ 100 billion debt, practically no access to the international stage. There had recently, though also one of the lowest public debt levels in its history.

electoral victory of the opposition Argentina chooses the change of epoch

the era of socialist governments in Argentina ends: the conservative mayor of Buenos Aires, Mauricio Macri, wins the presidential election. It stands for reconciliation with the international donors.

Argentina again needs access to financial markets

Final became a leper Argentina by a decision of a US federal judge who ruled that Argentina only the hedge funds must pay before it could settle the claims of other private creditors. The judge must now Argentina again until the access to the international financial market allow. Within six weeks ago, this should be achieved but, Pollack said.

President Fernández de Kirchner cemented this role as an outsider, so they cultivated. This brought her a great deal of approval on the Left, especially in Southern Europe and especially in Greece during the euro debt dispute. This policy has since the appointment Macris history. He won the election against Kirchner’s preferred successor Daniel Scioli in October, 2015. Macri sat on understanding with the financial markets – he will now need, because without new debt is Argentina can hardly pay its arrears with the Fund

The agreement provides a comparison in the equivalent of 4.25 billion. Euro ago, with the Argentina enclose all disputes, said promoter Pollack. The group of creditors led by the New York hedge fund NML Capital, which is part of the financial empire of US billionaire Paul Singer. What Singer has persuaded to waive a portion of the amount was still unclear Monday night. Perhaps he realized that was no longer pick up. This experience had also earlier investors do with Argentina. Between 2005 and 2009 more than 90 percent of creditors of Argentina had agreed to a haircut and dispensed with up to 70 percent of their money.


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