Exclusive: Argentina says debt swap going ahead
BUENOS AIRES |
BUENOS AIRES (Reuters) - Argentina is sending a "strong signal" that a swap of defaulted sovereign bonds is going ahead as planned, Economy Minister Amado Boudou told Reuters in an interview on Wednesday.
The debt swap, which Boudou has said will launch later this month, will open "as soon as possible," he said, adding that the government was still waiting for approval from the U.S. Securities Exchange Commission (SEC).
The government is hoping to settle with holders of $20 billion in defaulted debt to clear up fallout from a 2002 default to issue new bonds to help cover the $13 billion in debt payments the country faces this year.
"There is a firm political decision to move forward with the swap," Boudou said. "We're sending strong signals that the president's decision will not be altered."
Some analysts have raised questions whether an ongoing dispute over government plans to use $6.6 billion in foreign currency reserves to pay debt threatens to delay the exchange.
Argentine bond prices have fallen since Fernandez used a presidential decree last week to fire Central Bank chief Martin Redrado for opposing her reserves plan.
The fall in debt prices threatens to make any potential deal less attractive to bondholders.
Turmoil over Fernandez's decision to set up the fund and oust Redrado has pitted the government against Argentine courts and Congress, where opposition leaders have questioned the legality of the move.
A judge has temporarily reinstated Redrado and blocked the government bid to tap the Central Bank's foreign reserves.
Boudou said the government intends to forge ahead with the reserves fund, which he has described as key to determining the interest rate Argentina pays when it returns to global credit markets after the swap.
He also said senior Argentine officials were meeting with retail investors and banks in Mexico and London to discuss the proposed swap.
Boudou said the banks managing the swap had at no time proposed delaying the transaction.
(Additional reporting by Guido Nejamkis and Jorge Otaola; Editing by Andrew Hay)
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