MercoPress. South Atlantic News Agency

Argentina sends the Paris Club a possible road map for negotiations

Economy minister Amado Boudou: sustained growth and social inclusion

Argentine Economy Minister Amado Boudou confirmed that the ministry sent a letter to the Paris Club in order to initiate negotiations and establish a course of action for the cancellation of debt, although no specific dates were mentioned.

”We sent the response to Ramón Fernández (Paris Club representative), and we proposed a date for the nearby future, looking to establish a course of action to solve this issue“ said Boudou during a press conference at Government House in Buenos Aires.

The minister reiterated that the payment of debt will not take place in a year ”under any circumstances,“ adding Argentina's needs will be kept in mind to ”preserve sustained economic growth with social inclusion“.

The negotiating process ”will be nothing like the one involving the mega-swap or the ones that took place in the 1980 and 1990 which were clearly unfavourable to the country“.

”Before, negotiations were done by looking more at what the shareholder needed than at what the country needed“ he said.

When asked whether or not the payment would be done with Central Bank reserves, the minister dodged the question and said ”first we have to establish what the payment plan is and then we'll see what the best financial source is”.

The minister also revealed that the recent visit of President Cristina Fernández de Kirchner to Germany where she met with German Chancellor Angela Merkel, ”was the key to start the negotiations”.

The government of President Cristina Fernandez de Kirchner made it a point that negotiations with the Paris Club would only take place if there was no intervention of the International Monetary Fund.

Argentina owes the Paris Club, an informal association of creditors that includes the US, Germany, UK, France, Japan among a total of 19 developed countries, an estimated 6.7 billion USD in defaulted debt.

Negotiations with the Club of Paris were not only being demanded by the 19 country members’ authorities, plus the IMF, World Bank and other multilateral organizations but also Argentina’s corporate and business groups needy of foreign long term credit at flexible market rates.