News Center

"US insists on a solution for the rest of the creditors"
Clarin
September 04, 2008

by Ana Baron
WASHINGTON CORRESPONDENT

They say that the bondholders and businesses with suits against Argentina must be paid.

There is a consensus in Washington and on Wall Street that the payment to the Paris Club is a positive step, but not enough to recover the confidence of international markets.

A US official, who asked not to be identified, confirmed to Clarin that the US hopes now "to be able to work with the Argentine government on the measure that normalizes its financial relations with all foreign creditors." The official explained that this includes "the holdouts", or the bondholders that fell outside the swap and filed lawsuits in the Federal Court of New York and have already had rulings in their favor. These last are those that impede Argentina from operating freely in international markets, due to the threat of embargoing any Argentine asset that they find abroad.

According to the US official, it's also very important that the government comply with the businesses that are suing Argentine in the International Center for Settlement of Investment Disputes (ICSID) of the World Bank.

Companies like Enron, CMS or Sempre accused Argentina of having broken bilateral accords with investors and while there are already rulings in their favor, the country has not paid what is owed them.

From the beginning, the US signaled the importance that Argentina arrive at an agreement with the Paris Club as a first step towards normalizing its relations with the international financial community. The undersecretary of State for Hemispheric Affairs, Tom Shannon, said on various occasions to this correspondent that Argentina would need some kind of good view of the IMF. The Argentine government always opposed any IMF monitoring. Yesterday when the number-two at the IMF, John Lipsky, was asked, he said that he hoped "that this represents a positive step." Today, in press rounds, there will be a positive statement.