MercoPress. South Atlantic News Agency

Argentina insists in can meet 2009 debt obligations

Minister Carlos Fernandez

Argentina can meet its debt obligations despite the global financial crisis and a slowing economy, said Economy Minister Carlos Fernández. “The state has the necessary resources to meet its 2009 debt obligations, even taking into account the difficult conditions in the international financial markets,” he said.

There are growing fears among investors about Argentina because of doubts over the country's ability to meet rising debt payments next year as prices for its commodity exports fall and the economy slows. After revealing that "since 2003 we have acquired 32 billion dollars in reserves," Fernández highlighted the fact that "the growth over the last few years was financed by internal savings, generated by the economy's own dynamic" noting that "within this scheme, an increase in public savings played a crucial role." Fernández praised "the role of public works in motivating the economy," and assured that "fiscal solidity affords us the opportunity for public investments which, combined with private investment, guarantee considerable levels of activity in the sector". He justified this by assuring them that "in 2009, the country will receive more financing than in 2008 from the World Bank, the IDB, and the Andean Development Corporation... This is credit which has already been allocated, continuing in 2010 and 2011." He said that, "unlike in the United States, the recovery of the construction sector has not come about at the cost of a mortgage bubble, but with the population's genuine demand for greater income." Latin America's third largest economy has grown by more than 8.5% in each of the last five years. Last week, Congress approved a plan by President Cristina Fernández de Kirchner to nationalize Argentina's private pension's funds, a move that heightened investor concerns about the country's ability to pay its debts. Argentina owes 20 billion US dollars in interest and principal on its debt in 2009 and only eight billion dollars of that is accounted for in the government's financing program.