News Center

Doubts about Argentina at U.S. forum
La Nacion
February 09, 2010

In Miami, debt swap, Redrado's exit and the institutional situation are analyzed

Silvia Pisani
U.S. Correspondent

WASHINGTON.- The situation generated by the uncertain use of Central Bank reserves, the announced debt swap and the political scenario in Argentina were reasons for a critical evaluation at a forum which the University of Miami organized on economic and trade perspectives.

Defined as an "outlook on the perspectives on economics, business and trade in the region for 2010," the forum brought together figures from U.S. politics with knowledge and experience in the region. Among them, three former assistant secretaries of state for Latin America: Peter Romero, who served in the administration of Bill Clinton, and Otto Reich and Brian O'Neill, who served under President George Bush.

"Argentina wasn't the priority issue, but there were disquieting comments," said attendees. The change in management at the Central Bank was seen as "a clear example of government intervention," according to Otto Reich's analysis.

The announced debt swap also didn't have a very clear horizon. And there were doubts about the "level of acceptance" at a low percentage that the offer could generate and without it being clear with what resources it will be done. There were comments about the "levels of corruption" in the country and the "lukewarm role" of an opposition that "allows everything."

"There are enormous possibilities for trade with China and all of Latin America, the only one apparently taking advantage of this is Brazil. The rest don't see it clearly and are not taking advantage of it," said O'Neill, at a different time in the seminar.

At the same time, the first hours of Mercedes Marc del Pont as head of the Argentine monetary authority were followed with interest from various fronts. The State Department said, since the institutional crisis over the leadership of the Central Bank began, that it is following the issue "closely and attentively."

Added to the debate is the International Monetary Fund (IMF), whose spokesperson, Caroline Atkinson, spoke of the need for "independence" at the Central Bank.

The official said this when asked specifically about Argentina. But in her response she took care about mentioning the country and said she'd answered "in general terms."

In the local financial media, they are following the first hours of Marco del Pont's leadership with the fruition of those looking at the future of a deal. Local operators are crossing their fingers that the situation finally "stabilizes" and the announced debt swap can move forward. And they know that this will not occur until the crisis over leadership from the past few weeks calms down.

Also waiting are the so-called "vulture funds" the eaters of carrion, according to President Cristina Kirchner who are waiting for just the same as the Casa Rosada. That is to say that the government does the swap so a good difference of money is obtained. Local operators and sources at the Economy Ministry put the vulture fund Gramercy in this position, a holder of many billions of dollars in unpaid bonds from this country.

Other vulture funds are seeing the first hours of Marco del Pont with a different view: that is to say, waiting for evidence that will allow them to turn again to the U.S. courts to file complaints.

Only three weeks ago, the fund NML-Elliot managed to get Judge Thomas Griesa to temporarily embargo Central Bank reserves with the argument that the monetary authority was an arm of the government that they claimed was paying its accounts. There are those here that think the same could come back to happen if Marco del Point is permeable to the aims of the Casa Rosada.

U.S. Government
Takes Action

Click here to view letters by the Administration and Members of Congress on Argentina's debt and economic policies.

The Debt and Europe

Click Here To Read More

ATFA Member Spotlight

Resolution on Argentina's Generalized System of Preferences Status (GSP)

Click here to view other ATFA member activity

Join Us
Show your support for ATFA and our work regarding debt default by joining our growing list of supporters.

Tell Your Friends
Do you have friends or colleagues who would be interested in supporting ATFA? Send them an invitation to this site by clicking here.