Date
20 November 2017
Argentina's economy minister Axel Kicillof said he will not sign "any agreement that compromises the future" of his people. Photo: Bloomberg
Argentina's economy minister Axel Kicillof said he will not sign "any agreement that compromises the future" of his people. Photo: Bloomberg

Argentina defaults on debt for second time in 13 years

Argentina defaulted on its sovereign debt for the second time in 13 years after last-minute talks Wednesday with holdout creditors failed to yield a deal, Financial Times reported Thursday.

“Vulture funds” had rejected a renewed offer from the government, Argentina’s Economy minister Axel Kicillof was quoted as saying.

“We are not going to sign any agreement that compromises the future of the Argentine people,” the minister said at a news conference in New York after the talks collapsed.

Argentina will take all measures available to put an end to “unprecedented and unjust situation”, he said, adding that the country will remain open to a dialogue with creditors.

Shortly before the minister’s declaration, Standard & Poor’s placed Argentina’s credit rating on “selective default”, after the nation failed to make a US$539m interest payment on its debt by a Wednesday deadline.

It marked the country’s second default since the turn of the century. Argentina had previously defaulted on U$100bn of debt in 2001-02, at the time the largest sovereign default in history.

Economists expect the latest default to worsen a recession, trigger higher inflation and put pressure on foreign exchange reserves, possibly leading to Argentina’s second devaluation this year, FT said.

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RC

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