South America

The province of Buenos Aires has broken through an impasse with a group of its bondholders, inching closer to avoiding a messy default over an overdue payment and helping the national government press on with the restructuring of more than $100bn of debt it is struggling to repay, the Financial Times reported. Negotiations between the province and its bondholders broke down last week, but on Monday, the government sweetened the terms it would offer, just days before the already extended deadline was set to expire.

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Can Argentina Escape a Debt Default?

Almost two months into Alberto Fernández’s presidency, Argentina’s private creditors are increasingly worried about the slow progress in fixing the heavily indebted country’s most urgent problem: avoiding its ninth sovereign debt default, the Financial Times reported.This frustration has been reflected in rising bond yields and a widening of the gap between official and parallel exchange rates. With a provincial debt default possible in the coming days and debt payments to international creditors due this year, Mr Fernández is in on a tour to garner support.

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Argentina's lower house of Congress approved a bill on Wednesday that would enable the government of President Alberto Fernandez to handle a massive debt restructuring of bonds issued in foreign currency that it needs to negotiate with creditors, the International New York Times reported on a Reuters story. With support from the opposition, the bill was approved with 224 votes in favour and two against. The bill moves to the Senate, where it is expected to pass next week. The Fernandez government, inaugurated on Dec.

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Creditors of corruption-ensnared conglomerate Odebrecht SA have delayed discussion of the restructuring of 51 billion reais ($12.2 billion) in debt to March 18, according to two sources with knowledge of the matter, Reuters reported. A vote on the plan had been expected for Wednesday, but creditors agreed to delay discussions following a decision by creditors of one of Odebrecht’s units, Atvos, to postpone their vote to March 27.

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As Venezuela enters its third full year in default, its obligations have become something of an afterthought to even its biggest creditors, Bloomberg News reported. Worth just pennies on the dollar, tens of billions in bonds routinely go days at a time without trading. Sanctions bar U.S. investors from buying them and make the prospect of a full-scale restructuring all but impossible. And with no end in sight to the political stalemate in Caracas, it’s no wonder few creditors have taken the costly step of taking the government to court.

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The Chamber of Deputies voted overwhelmingly Wednesday to approve a bill to restructure the Argentine government's $100 billion debt, which officials say is unpayable amid a deep recession that has reawakened old fears of financial crises, the International New York Times reported on an Associated Press story. With the support of the main opposition parties, the government of President Alberto Fernández saw the measure pass 224-2 while leftist groups opposing the legislation protested outside congress. The bill now goes to the Senate for debate next week.

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Colombian flag carrier Avianca Holdings is making progress with a restructuring plan for its finances that will keep it in the air without having to take measures such as declaring bankruptcy or insolvency, company executives said on Wednesday. Over the course of the restructuring, which began last year, the company will divest its non‐core activities and simplify its fleet to improve profits and leave behind a financial crisis that arose in 2019, Reuters reported. “The company’s financial situation has turned 180 degrees.

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Venezuela’s opposition-run congress said on Tuesday it had set aside $20 million held in accounts in the United States to pay for litigation abroad as part of efforts to protect the country’s offshore assets from lawsuits by creditors, Reuters reported. Offshore assets including U.S. refiner Citgo have long been seen as attractive by investors holding the country’s defaulted bonds and companies seeking to be paid back for the nationalisation of their holdings.

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Venezuela’s state-run oil company PDVSA said its financial debt fell less than 0.1% in 2019 from the prior year to some $34.5 billion, though it remained in default on its bonds as sanctions freeze it out of the global banking system, Reuters reported. PDVSA, which is short for Petroleos de Venezuela S.A., has stopped paying interest on most its bonds, and together with Venezuela’s government has accumulated billions of dollars in late interest payments.

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The Province of Buenos Aires improved the terms it’s offering bondholders if they agree to accept delayed payments, an about-face from the cash-strapped government after its first overture failed to attract sufficient support, Bloomberg News reported. In exchange for pushing back the deadline on a $250 million principal payment, investors would receive an extra $7.2 million in interest, according to the offer revealed Monday. Previously, officials were asking creditors to sign off on the three-month delay without any additional compensation.

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