Argentina

Argentina’s international creditors, scarred by this year’s turbulent debt restructuring, want the new International Monetary Fund programme the country is seeking to come with ultra-rigorous conditions, Reuters reported. Argentina and its provinces restructured $100 billion of debt two months ago, but the country’s bonds have lost nearly 30% since their relaunch as worries about the government’s economic strategy have persisted. On Monday Economy Minister Martin Guzman, who led the restructuring for Latin America’s No.

Argentina will seek an Extended Fund Facility (EFF) from the International Monetary Fund (IMF) to replace a failed $57 billion facility, Economy Minister Guzman said on Monday, potentially buying the South American country more time to make repayments, Reuters reported. The EFF is a longer-term program that typically requires more economic reforms than a standby agreement. Argentina would expect to repay the IMF between four and a half years and 10 years after the start of the agreement, Guzman said, adding that he aimed to secure a new deal by April.

A mission from the International Monetary Fund will visit Argentina from Nov. 10 to begin formal negotiations for a new financing program, an IMF spokesman said on Friday, Reuters reported. Dialogue between the mission and Argentina will focus on the government’s fiscal agenda in the medium term “with the aim of anchoring macroeconomic stability and laying the foundations for inclusive and sustainable growth,” the spokesman said in a statement, adding that there is no set date for negotiations to conclude.

Walmart Inc, the world’s largest retailer, said on Friday it was selling its retail operations in Argentina to South American supermarket chain owner Grupo de Narváez, pulling back as the country grapples with an economic crisis, Reuters reported. The U.S. company did not disclose the size of the deal for retail operations involving more than 90 stores, but said it would record about a $1 billion after-tax, non-cash loss related to the divestiture in its fiscal third quarter next year.

Argentina has undone a huge amount of positive work done in reaching an agreement to restructure its debt through its financial mismanagement and the government only has itself to blame, according to Raphael Kassin, Citywire reported. Emerging market debt veteran Kassin made the comments during the most recent episode of our sister publication Citywire Selector’s EM Insider podcast.

Argentina’s wide gap between its official peso spot rate and closely watched prices of the currency in alternative and black markets has narrowed amid signals the central bank will tighten its funding of government spending, Reuters reported. The gap between the peso rates has soared this year amid tight controls on access to dollars, concerns over the economy and money printing to pay for the indebted country’s emergency response to the COVID-19 pandemic. But since a peak around Oct.

Sovereign default risks are on course to rise further in 2021, with Iraq, Sri Lanka, Angola and Gabon at high probability of default, say Goldman Sachs analysts, Reuters reported. Five sovereign debt defaults or distressed debt exchanges - in which investors swap their debt for new bonds, often with longer maturities and a reduced value - have already happened in 2020 in the aftermath of the COVID-19 crisis, the most in around two decades.

Some of Argentina’s biggest bondholders have issued a sharp rebuke to the government over its handling of the country’s deteriorating economic situation, just a few months after reaching a compromise to restructure $65bn worth of debt, the Financial Times reported. In a statement released on Thursday, two creditor groups at the heart of the recent negotiations to resolve Argentina’s unsustainable debt burden accused the government of putting forward policies that “undermine” its own economic recovery, such as its recent decision to tighten capital controls.

Argentine bondholder groups slammed the government on Thursday over economic policies they said were undermining investor confidence in the country, which emerged from a sovereign default in September after a $65 billion restructuring, Reuters reported. Two of the groups involved in that debt revamp said in a statement that policies since then had “failed to restore confidence” and instead had “dramatically worsened the country’s economic crisis.” Bond prices have dropped sharply since the exchange.

Investors are giving up on Argentina just six weeks after it pulled off a $65 billion restructuring, Bloomberg News reported. The country’s overseas bonds have plummeted more than 20% since early September, the world’s biggest drop in that span. Morgan Stanley calls it the worst rout in the aftermath of a restructuring in at least 20 years, and it comes despite the nation winning a whopping $38 billion of debt relief from creditors. Those same investors have been dismayed at what followed.