Argentina on edge of default caused by US courts and vulture funds
Argentina could today enter a technical default on much of its debt. The Argentine government has tried to make the repayment due on its debt but has been prevented from doing so by a US judge following a case brought by two vulture funds, NML Capital and Aurelius Capital Management. Argentina’s latest instalment on the majority of its debts was due on 30 June and there is a one-month grace period before a default is announced. This grace period ends on Wednesday 30 July.
Commenting on the situation, Sarah-Jayne Clifton, Director of Jubilee Debt Campaign said:
"Argentina has tried to pay the instalment owed on its debts but has been blocked by a US court. This ludicrous situation is the result of vulture fund greed, perverse US court judgements and the lawless world of international debt. The real outlaws here are the US vulture funds profiteering from the distressed debt of countries in crisis.”
Commenting on the possible default, Sarah-Jayne Clifton continued:
“Thankfully, a default is unlikely to be disastrous. Whilst the circumstances are very different, Argentina’s last default in 2002 led to economic recovery. What would be disastrous would be for Argentina to yield to this unfair legal judgement and the extortion of the vulture funds. Paying the vultures could not only lead to billions of dollars in counter-claims from other holders of debt, it would set a deeply troubling international precedent, making it harder for countries across the world to resolve future debt crises.”
ENDS
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