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Debt repurchasing confirmed
La Nacion
August 22, 2008

The measure will continue until the end of the year to deflate expectations of a default

The Economy Ministry yesterday confirmed that it will continue until December its repurchasing of debt bonds that come due this year or next.

Finance Secretary Hern n Lorenzino told LA NACION that this program seeks to go against the expectations among analysts who fear a default in 2009.

-How will the debt repurchase program continue?

-We will move into a second stage of the debt repurchase program, which includes a stage of public auctions, without ruling out the alternative of intervention in the secondary market that we had been carrying forth. It will begin next week and continue through the end of the year.

-The repurchase hasn't lost its effect?

-I don't believe so: the goal that the government put forth is to take advantage at this moment with our debt to send a sign of the will to pay. And that manages to give predictability for the medium term.

-To use the funds of Banco Nacion isn't a bad sign?

-No, because Banco Nacion acts as the financial agent of the State and now we are incorporating the possibility that the Central Bank also does repurchasing with money from the Treasury to gain efficiency and versatility.

-The analysts are predicting a possible default in 2009.

-The goal of this repurchase program is to go against those negative expectations not only for 2009 but for the coming years. Argentina's fundamentals are solid and ought to be sufficient to discourage that fear and with this program we are reinforcing that idea.

-The repurchase isn't just serving as a "bridge", to the hope of changes in INDEC and consolidating the fiscal surplus?

-This is an important signal to dispel doubts over the capacity to pay, along with the high reserves of the Central Bank, the fiscal surplus and the economic growth that is predicted for this year.