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July 28, 2014

Argentina Faces Looming Deadline to Avoid Default; Protests Back Refusal to Pay Vultures 
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Argentina is facing a potential default on its sovereign debt if it
fails to meet a Thursday deadline. A recent Supreme Court ruling sided
with U.S. hedge funds who purchased Argentina’s debt for bargain
prices after its financial crisis and then refused to cut the value of
their holdings, as most other creditors did. A lower court judge then
barred Argentina from repaying the majority of its creditors without
also repaying the so-called "vulture funds," led by billionaire Paul
Singer’s NML Capital. The Argentine government says it is impossible
to fully repay the vulture funds, risking the country's second default
in 13 years. At a protest in Buenos Aires, demonstrators backed the
government's refusal to pay the vulture funds.

Protester: "We don't propose to go into default. We decided that it's a
sovereign decision not to pay. We've paid the IMF. We've paid the
vulture funds. We've paid the International Centre for Settlement of
Investment Disputes. We paid the Paris Club. And on top of this, they
will declare a default. This is why we decided not to pay."

 

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