Sunday, July 8, 2007

Paris Club Repayment: Argentina and Peru

Erste Bank reported that Argentina's refusal to settle its $6 billion debt with Paris Club creditors is hurting the country's chances of getting credit ratings increases. Argentina hasn't paid its debt with the Paris Club since 2001, when it also defaulted on $95 billion of bonds. Argentina’s refusal comes from the fact that Kirchner will not sign any accord with the IMF, a pre-condition required by the Paris Club borrowers. On the other hand, Paris Club members accepted Peru's proposal to make an early repayment in the amount of $1.75 billion of its $5.75 billion debt to 12 of the Paris Club's 15 members.

According to Erste Bank: “Peru is repaying its foreign debt in a bid to have 30 percent of its obligations in local currency, up from about 24 percent now. Peru plans this year to sell mostly sol-denominated 30-year bonds to finance the payment, due by October 1.”

No comments:

Post a Comment