The Ministry of Economy stated that it agreed with the Paris Club on a new “time bridge” to avoid the negotiation deadline, which would end on March 31. Thus, Argentina and that consortium of creditor nations will embark on discussions for restructuring after the IMF board approves the new financial program.
“Argentina on June 22, 2021 had committed to the Paris Club to reach an agreement with the IMF by March 31, 2022. Thus, the country achieved a time bridge, avoided default and obtained financial relief of USD 2 billion with this group of creditors while continuing to negotiate with the Fund,” Economía reported in a statement.
According to the Hacienda Palace, with this new understanding, “the country gains time and avoids again exposing Argentina to default. It is sought, after the conclusion of the agreement with the IMF, to conclude the renegotiations of the '2014 Joint Declaration' with the Paris Club”, they assured. In this way, they will seek to change the repayment conditions that had been agreed by the government of Cristina Kirchner, when Axel Kicillof was Minister of Economy.
In addition, they considered that the agreement negotiated by Martín Guzmán and the president of that forum Emmanuel Moulin, “represents an endorsement of the Extended Facilities program during the two and a half years of validity.” In this regard, the French official “expressed his support for the programme achieved”.
Moving forward, the parties agreed to soon begin the restructuring of the outstanding USD 2 billion. “Argentina has already restructured its debt with private creditors, it is now closing refinancing with the IMF and the next step will be to close the debt renegotiation process with the Paris Club,” they continued from Economía.
However, the Government must continue to make partial payments for the duration of the negotiation. “Argentina will only have to make partial payments to Paris Club members in proportion to those it makes to other bilateral creditors, in accordance with the terms established in the understanding of June 22, 2021,” they concluded.
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