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Argentina publicly adds Germany to its list of 'hostile countries'

Thursday, September 25th 2014 - 05:06 UTC
Full article 38 comments
Finance Minister Wolfgang Schäuble was quoted saying Argentina's debt policy was “a prime example of fiscal mismanagement” Finance Minister Wolfgang Schäuble was quoted saying Argentina's debt policy was “a prime example of fiscal mismanagement”
Germany one of 11 countries that voted against Argentina's proposal at the UN for a multilateral legal framework for sovereign restructurings, said Capitanich Germany one of 11 countries that voted against Argentina's proposal at the UN for a multilateral legal framework for sovereign restructurings, said Capitanich

Argentine Cabinet Chief Jorge Capitanich on Wednesday lashed out at Germany's finance minister, denouncing Berlin's “hostile attitude” toward Argentina's debt restructuring effort. He added that Germany had always had a hostile attitude toward Argentina from an economic and financial point of view.

The criticism came after local newspapers ran an advertisement quoting German Finance Minister Wolfgang Schäuble as saying the Latin American country's debt policy was “a prime example of fiscal mismanagement.” Schäuble allegedly made the remark in Berlin in August this year.

The advertisement was posted by US lobby group American Task Force Argentina (AFTA) on behalf of several hedge funds suing Argentina for full repayment of bonds they bought at a steep discount after Argentina's default in 2002. These hedge funds specialize in buying up distressed debt on a speculative basis, and then using lawsuits to try to collect the full nominal value of the debt.

AFTA's ad campaign marks the latest spat generated by Argentina's July default, which sealed the country's exclusion from the international capital markets. Last week, Buenos Aires expressed “deep indignation” after a US diplomat had referred to the country being in default.

Argentina has repeatedly claimed it is not in default because it made every effort to pay interests on bonds restructured after an agreement with nearly all of its creditors about a decade ago. The government said it had deposited 539 million dollars with an intermediary bank in New York.

The coupon payment, however, was blocked by US District Judge Thomas Griesa, who said Argentina must first pay the hedge funds 1.3bn dollars before any more payments can be made on Argentina's restructured debt. Argentine President Cristina Fernandez has described the US hedge funds as “vultures” that are bent on ruining the country's finances in pursuit of unearned and unethical profits.

Capitanich also noted that Germany was among 11 countries that voted against Argentina's proposal at the United Nations to adopt a multilateral legal framework for sovereign restructurings. On September 9, the UN resolution easily passed, but Germany joined the United States in voting no, arguing that market-based mechanisms are the best way of curing defaults.

“You have to wonder why the big powers of the world do not have a firm attitude toward these miniscule groups that pulverize any possibility of allowing the international financial system to function properly,” Capitanich said, suggesting that Germany might have been “co-opted by the vultures.”
The German government has not yet reacted to the criticism
 

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  • LEPRecon

    I'll bet Germany are shaking in their boots this morning!

    Fancy being put on Argentina's list of hostile countries. I mean that'll restrict Germany in so many ways, such as...er...er...well...er...er...that'll learn them anyway.

    In the meantime in the real world Germany hasn't even noticed.

    Sep 25th, 2014 - 05:27 am 0
  • BOTINHO

    “ A prime example of fiscal mismanagement. ”

    The statement is quite accurate.

    Nice foto of Sr Capitanich. Lying so much he is turning cross-eyed.

    Sep 25th, 2014 - 06:04 am 0
  • reality check

    So if someone has the opinion that you should obey the law, that gets you classified as hostile, does it?

    I've said it before and I will say it again, you really could not make this shit up!

    Sep 25th, 2014 - 06:33 am 0
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