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Paris Club payment: Boudou insists on taking the IMF out of the middle
Clarin
June 25, 2010

The debt swap concluded, the economic team is concentrating now on putting an end to the judicial claims initiated by the vulture funds, while designing a strategy to move ahead with the renegotiation of the debt with the Paris Club that doesn't include a review of the economy by the IMF.

"The country has no debts with the IMF, as such it will not have any program with that organization. And if this is an obstacle, neither will we be able to solve the problem with the Paris Club," Amado Boudou said.

However, the Economy Minister was confident that in the case of the Paris Club it will be resolved. "It's one of the issues that Argentina has to resolve and undoubtedly we will find a solution, with an Argentine vision," he said.

What the government doesn't want is that IMF officials come to the country to review the numbers of the local economy, especially the inflation figures which the INDEC puts out. But to comply with Article IV of the IMF is one of the requirements that member countries of the Paris Club make to be able to move ahead in renegotiating the US$6.7 billion that Argentina owes.

"While we're speaking of technical issues, in technical terms, it seems fine to use. Now, if the IMF plans to make opinions about the pension system or the labor rules, questions in which they have failed each and every time they've made a proposal in any part of the world, we are not going to allow it," Boudou said.

The Economy Minster, who yesterday was in Brazil with his peer from Production, D bora Giorgi, analyzing the different variables in bilateral trade, will depart today accompanying Cristina Kirchner to the G-20 meeting in Canada.

Before showing up at that international forum, Boudou insisted that the government intends to deactivate the lawsuits that the vulture funds have filed against the country. "The claims against Argentina now are unjustified," he said. And he added that the government will not negotiate with the vulture funds, who still hold some US$4.5 billion in bonds in default. "The strategy is to continue isolating them, showing that they have a proposal that is not only uncooperative, but irrational," Boudou said.

In the government, they're studying the application as a strategy the idea of obliging the creditors that didn't enter the swap to accept the proposal that 66% of the bondholders adhered to, arguing that Argentina's default is like a bankruptcy of a business, in which all the creditors are obliged to accept the same level of losses. But some analysts said that it's difficult for Judge Thomas Griesa how has the majority of the cases in his hands to side with this request.

"We think that now we're better places because we're competing with fewer creditors," said Suzanne Grosso, attorney with the firm of Debevoise & Plimpton, which represents the fund EM Ltd, of the Dart family.

Meanwhile, Nicola Stock, head of Task Force Argentina (TFA) which is made up of Italian bondholders that didn't want to enter the swap argued that "tere are still people who believe that Argentina should not decide in a unilateral form what they'll give back to the bondholders." And he was confident that "a good number" of bondholders will stick to their claims. TFA filed a claim at the ICSID, an arbitration forum of the World Bank.

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