MercoPress. South Atlantic News Agency

Argentina to request on Monday a review of US Judge Griesa latest ruling

Minister Lorenzino continued to question Judge Griesa’s decision

Argentine Economy Minister Hernán Lorenzino assured during a press conference on Thursday that “paying off the vulture funds is illegal,” and said that the ruling by US District Judge Thomas Griesa against Argentina is “unfair”.

However on Monday Argentina will present an ‘urgent’ revision request to review the ruling before the New York Court of Appeals. The ruling means Argentina will have to pay the defaulted bond holders 1.3 billion dollars.

The minister also warned that Griesa's ruling might affect the international financial system and the country as well and insisted “Judge Griesa doesn't have the power to define this current situation”.

“Who is going to accept a debt restructuring, with significant cuts and 30 years long term if with time, patience, good lawyers and a permeable judge they can collect the full face value of the bonds?”, asked Lorenzini.

“We are going to maintain Argentina's position in every available way, as we have been doing so far,” Lorenzino said, as he reminded that the government will face “every decision that is against Argentina's interests before the US Supreme Court and international tribunals” and insisted will pay restructured bond holders on 2 December as originally programmed.

In a ruling the US District Judge rejected Argentina's request to maintain his previous order halting payments to holdout investors who did not participate in two bond exchanges of defaulted sovereign debt.

“The Judge did not order the payment and it is the Appeals court to decide on that”, said Lorenzini. In its first decision the Appeals Court confirmed Judge Griesa ruling but also remitted the case back to him to indicate how payments will be made. That is why Argentina and the investment funds were asked to send their payments request.

In that presentation Argentina ratified its decision not to pay the investment funds.

Lorenzino also complained that contrary to what is normal and customary, “we received the Judge’s decision by e-mail at a very unusual time, very late at night”. He added that nine presentations were made between last Friday and Monday, that is 48 hours, in which they were analyzed and the decision came in yesterday (Wednesday) at last moment, and since today is a holiday in the US, it means the ruling only took 48 hours”.

The Argentine government is hopeful that the New York Court of Appeals reaches a decision before December 15 which is when, according to the ruling from Judge Griesa, Argentina must deposit in an escrow the 1.3billion dollars for the holdouts. That same day the bonds linked to the country’s GDP mature and if the ruling is adverse, there is fear among investors that Argentina will not be able to make the payments.

The impact was felt in Buenos Aires markets and on Thursday following Wednesday’s ruling, the benchmark stock index closed down by 3.3% at 2,242.40 points and growth linked GDP warrants plunged 13%.

Planning Minister Julio De Vido was the first Cabinet member to come on stage after the ruling against Argentina over vulture funds. During a meeting with mayors of La Pampa province he referred to Thomas Griesa’s ruling saying that he wasn’t qualified to criticize it, but instead accused former economy ministers “from (José Alfredo) Martínez de Hoz to (Domingo) Cavallo who were responsible for giving away Argentina’s sovereign jurisdiction.”

However the president from Banco Ciudad Federico Sturzenegger said that Cristina Fernández administration “sought” the ruling to “hide” the country’s domestic issues. He furthered questioned the government’s way to address the issue of those holdout investors who did not participate in two bond exchanges of defaulted sovereign debt.

“The way this issue was addressed is probably the worst case of malpractice seen in the government of Cristina Fernández de Kirchner,” he added.

”They (the government) find in the vulture funds and the Libertad Frigate issues things that put them as the leaders of an ethical fight,” the economist said.