Argentina

Argentine President Alberto Fernandez is facing resistance from the agriculture industry, businessmen and even pot-banging citizens after announcing a decision to seize one of the world’s largest soy meal and oil exporters, Vicentin SAIC, Bloomberg News reported. Argentines from Buenos Aires to the northern city of Avellaneda, where Vicentin is headquartered, protested against the expropriation. On Wednesday evening, the sound of banging pots and pans could be heard in the capital, a traditional form of protest.

Latin American countries should quicken steps for airlines to renew domestic flights no later than July before more companies are forced to declare bankruptcy or close, a high-ranking official of the International Air Transport Association (IATA) said on Thursday, Reuters reported. The trade group estimated losses for airlines in Latin America at $4 billion this year, with total losses for the industry expected to reach $84 billion globally. Latin America has imposed stricter travel restrictions than most regions to fight coronavirus.

A second wave of Covid-19 would deepen this year’s recession in Latin America’s three largest economies by more than 1 percentage point, according to the Organisation for Economic Co-operation and Development, Bloomberg News reported. Argentina and Brazil would suffer the biggest hits, shrinking by 10% and 9.1%, respectively, while Mexico would contract by 8.6%, Paris-based OECD said in a report published on Wednesday. A possible second wave of the virus could come between October and November following the easing of containment measures currently in place, the organization said.

Argentine President Alberto Fernandez dipped into the play book of his deputy, Cristina Fernandez de Kirchner, with a plan to seize crop trader Vicentin SAIC in a move that’ll ring alarm bells in soy markets and among investors in the country, Bloomberg News reported. Fernandez’s government will take control of Vicentin for the next 60 days as it seeks congressional approval to expropriate the agricultural powerhouse, which filed for bankruptcy last year after being caught out in currency swings.

Argentina’s Mendoza province, famed for its bodegas and Malbec grapes grown in the shadows of the Andes, has formally launched a debt restructuring process after missing an initial payment deadline on a 2024 bond, Reuters reported. The regional government said in a statement on Friday that it had opened an invitation to holders of around $590 million of the 2024 notes, which could see new debt instruments issued. The missed payment is still within a grace period.

Argentina's Buenos Aires province extended on Thursday the deadline for debt restructuring talks with its creditors to June 19, saying there could be room for negotiation with its creditors, WHTC reported. The province pushed out the deadline, previously set for Friday, after failing to reach a deal with bondholders, but said in a statement that it would "intensify the dialogue with investors who have not yet accepted the proposal" for about $7.148 billion in debt.

As another debt deadline came and went this week, Argentina found itself in a familiar place: immersed in recession, beholden to the International Monetary Fund and at cross purposes with private lenders. If the coronavirus pandemic has bought Argentina some international indulgence, as the IMF made clear in a statement on June 1, it hasn’t eased the country’s burden or lifted uncertainty, Bloomberg News reported. Argentina surely deserves debt relief, but also a credible way forward. Borrower and creditors alike reckon that a deal will emerge; they have been inching closer for weeks.

IMF officials say Argentina can still improve its restructuring offer on $65bn of debt with foreign creditors as it continues negotiations after slipping into default last month, the Financial Times reported. “There is still room for Argentina to increase payments to private creditors,” Julie Kozack, deputy director for the IMF’s western hemisphere department, told the Financial Times on Tuesday.

Aerolineas Argentinas will begin negotiations with unions to suspend the contracts of thousands of employees until August after the flag carrier’s income plunged about 97% due to the coronavirus outbreak, it said on Monday, Reuters reported. The airline, which is staying afloat largely through state support, will pay workers’ social security and make smaller, spot payments during the proposed two-month suspension, it said in a statement. A source told Reuters the carrier aims to suspend some 8,000 of its 12,000 employees.

Argentina may have to dole out at least $880 million in subsidies this year to keep its state airline afloat, further weighing on government finances after the nation’s ninth sovereign default, Bloomberg News reported. Aerolineas Argentinas President Pablo Ceriani said the carrier’s budget shortfalls, up from about $680 million last year, will persist until demand rebounds, which isn’t expected for a couple of years.