(Recasts with Argentine president's statement)
By Nate Raymond and Richard Lough
NEW YORK/BUENOS AIRES, July 23 Argentina will
keep talking to "holdout" investors suing the country for full
payment on their bonds, but its demands should not be
trivialized as whims, its president said on Wednesday.
President Cristina Fernandez said Argentine officials would
travel as often as necessary to New York, where negotiations
aimed at staving off another painful debt default are being held
through a court-appointed mediator.
The latest round of debt talks between the two sides was
pushed back by a day on Wednesday, mediator Daniel Pollack said,
as the clock ticked down toward a July 30 deadline for a deal.
"We'll keep talking," Fernandez told workers at a new
factory outside the capital, Buenos Aires. "We'll go as often as
necessary to wherever we need to go. But our demands, they are
not just a whim."
Argentina faces its second default in 12 years if it fails
to cut a deal with the hedge funds demanding full payment for
defaulted bonds, instead of a reduced amount.
Argentina, Latin America's No. 3 economy, argues paying the
holdouts would break a legal clause protecting creditors who
accepted large writedowns after its 2002 default and open it up
to claims worth as much as $15 billion.
New York lawyer Pollack said the Argentine delegation "could
not get here in time" after U.S. District Judge Thomas Griesa on
Tuesday ordered both sides meet "continuously" until they
reached an agreement.
Pollack said the meeting had been rescheduled for Thursday
at 12 p.m. EDT (1600 GMT).
Argentina, which defaulted on about $100 billion in 2002,
has been pushed to the brink of a fresh default by U.S. court
decisions that it pay the $1.33 billion face value of the bonds
plus interest to bondholders who did not participate in debt
swaps in 2005 and 2010.
Bondholders who agreed to the restructuring terms received
Fernandez's unflinching stance in the battle against
"holdout" investors suing the country may increase the odds that
her government will default.
The possibility of a default came after Argentina last month
made what the ministry said was a $1.15 billion payment for its
restructured bondholders. That money included $539 million
deposited with indentured trustee Bank of New York Mellon Corp.
But Griesa deemed the payment a violation of injunctions
that required Argentina to pay the holdouts the $1.33 billion
the next time it paid the restructured bondholders.
The judge blocked transferring the funds to creditors,
triggering a 30-day grace period up to July 30.
The holdouts are led by Elliott Management's NML Capital Ltd
and Aurelius Capital Management.
Griesa on Tuesday called the possibility of default "the
worst thing I can envision" and said the two sides still had
enough time to work out a deal.
(Editing by Jeffrey Benkoe, W Simon and Lisa Shumaker)