MercoPress. South Atlantic News Agency

Argentina's foreign debt totals 149,8 billion US dollars

Argentina's sovereign debt swap operation saved the country 63,4 billion US dollars but overall foreign debt still remained at 149,8 billion US dollars at the end of the second quarter of 2005, according to a release from the Ministry of Economy.

The release shows that gross public debt between December 2001 (when the default) and June 2005 dropped from 144,4 billion US dollars to 126,4 billion. This is the first time that official Argentine foreign debt numbers includes the swap operation which had a 76% approval. Hold outs still represent 23,4 billion US dollars.

The debt reduction of 63,4 billion US dollars represents the difference between total debt at the end of the first quarter of 2005, 189,9 billion US dollars, and the 126,4 billion at the end of the second quarter when the swap operation was completed.

The hold outs, who did not accept the swap proposal, and totalling 23,4 billion US dollars, could finally also be included in some technical operation once Argentina reaches an agreement with the International Monetary Fund to roll over debt with multilateral organizations.

The release also indicates that leaving aside the hold outs, Argentina's total debt with private creditors, multilateral and country organizations is 94% normalized, equivalent to 119 billion US dollars, with 2,9 billion (2,3%) pending an agreement with the Paris Club and 4,4 billion (3,5%) with several countries.

Of Argentina's total sovereign debt June 2005, 46% is issued in US dollars; 36% in Argentine pesos and 11% in yens, Euros, sterling, Swiss franks and other currencies.

Debt with multilateral organizations totals 27,4 billion US dollars, with the IMF holding 11,21 billion, followed by the Interamerican Development Bank, 8,75 billion and the World Bank 7,33 billion.

As to maturities, the last quarter of 2005 will demand an estimated 4,95 billion US dollars, with 1,1 billion in October (including 156 million in interest payment); 1,2 billion in November and 2,2 billion in December.

Total annual payments in 2005 will have reached 9,5 billion US dollars of which 1,6 billion are interest.

A positive sign of the improvement in Argentina's finances, according to the release, is that interest payments December 2001 represented 38% of the country's exports and have now dropped to 9%, given the fall in liabilities and the increase in foreign trade.

However the GDP/debt ratio is still in the vulnerable zone, equivalent to 70%, but miles away from the 130% previous to the debt swap.