After failing to reach an agreement during Thursday's meeting with court-appointed mediator Daniel Pollack, Argentina reiterated that there could be no negotiations with speculative funds or 'vulture funds' until judge Thomas Griesa provides some insurance against possible liabilities related to the 'Rights upon Future Offers' (RUFO) clause.
The stipulation held with bondholders that entered 2005 and 2010 debt swaps dictates that Argentina give restructured titles the same payment conditions as those negotiated afterwards. Argentina maintains that paying holdout investors in full would leave them open to lawsuits from those creditors who accepted 'haircuts' on the bonds defaulted in 2001.
Just as it was expressed by Argentina before judge Griesa, the reasons why it is necessary to put in place some type of financial instrument that gives the Republic security regarding risks associated with the RUFO clause were explained, a statement from the Economy Ministry stated on Thursday evening, detailing the events of talks with Pollack.
It was signaled that if the plaintiffs ['vulture funds'] do not grant those guarantees to the Republic, a stay will continue to be the best option to allow progress towards a solution reached in fair, equitable, legal and sustainable conditions for 100% of creditors.
With this in mind, the communiqué states that the Republic expresses its concern for the lack of resolution on the part of judge Griesa in the audience of July 22, regarding the motions and alternatives presented to the court, including the presentations of restructured bondholders and various financial institutions; he continues to block the reception of funds already paid by Argentina.
The statement was prepared following a meeting between Economy minister Axel Kicillof and President Cristina Fernández Thursday evening. The next talks between speculative funds and representatives of the Argentine government are scheduled for Friday at 11 a.m. at Pollack's office in New York.