in the middle of a “Parisian Indian Summer” 23 degrees and when the French go on vacation to Toussaint, Argentina signed the postponement of the agreement with the Paris Club for 1,972 million dollars.
The new agreement was signed on Friday at 20:00 French time.
Sergio Massa, Argentina’s Minister of Economy, has digitally signed from Buenos Aires. In Paris there were Argentine negotiators, Marco Lavagnaresponsible for relations with multilateral organizations and head of INDEC, and the head of economic consultants, Leo MacDour. In English and French (Lavagna is a native speaker of French), they both discussed the new conditions for 17 hours with the creditor countries and with the secretariat of the Paris Club. The restless Minister of Economy, Sergio Massa, actively participated by telephone from Buenos Aires, until its closure.
Argentina agreed at dawn on Friday to renegotiate the debt with creditors with the Paris Club for a principal amount of $ 1,972 million. This understanding is a solution to the payment interruption problem below the 2014 agreement that the former Minister of Economy, Axel Kicillof, had signed in this city.
From this agreement, a fee remained to be paid which was that of May 2019. At that time, the Argentine government paid the minimum amount. The same thing happened in 2021. But the 9% interest rate accepted by Kicillof made refinancing expensive.
The agreement reached by Massa modifies those terms, he introduced a addendum which extends a repayment period of the installment due to thirteen six-monthly installments that will begin to pay in December of this year to be definitively canceled in September 2028. The interest rate has improved, going from the current 9% to a “step-up” rate, it starts from 3.9% in the first three installments and gradually rises. The weighted average rate is 4.5%.
“The most important thing about this agreement is the prospect of mobilizing lines of finance to be able to start large projects in Argentina” Blackboard, one of the negotiators told Clarín. “There have been several difficult parts. The most complex was getting all the creditor countries to join Argentina with a payment plan that was more appropriate to their reality and the situation we have. This required a lot of work from us, from the Paris Club and from creditors ”..
Madcur, the other negotiator, told Clarín “We had been 17 hours straight, beyond what we had done before from Buenos Aires, and at one point, at 5 in the morning, we had the feeling that we were very close, that few things were missing. We had planned to continue until Monday, but in the end we finished at 5:25 am on Friday “.
The negotiation took place in the Bercy bunker, seat of the French Ministry of Economy on the Seine. It was in one of its offices because the Paris Club does not have a seat.
Although the imposing, modern building of Bercy overlooked the Seine, Lavagna and Madcur were locked up in a windowless office and in another the representatives of the creditor countries. In a third there is the Secretariat of the Paris Club represented by the French Treasury Secretary, Emmanuel Moulin.
The main creditors of Argentina are Germany, Japan, Holland, Spain, Italy and the United States.
The Argentine negotiators isolated themselves and put themselves “committed” throughout the discussion until the end. Housed in the residence of the Argentine embassy, on avenue Foch, they have become inaccessible to the press. If they didn’t call, there was no way to enter Bercy or the residence.
The Paris Club agreement will allow Argentina, according to its officials, to open bilateral discussion projects, or with Argentine companies that want to rethink their investments, such as France or Germany. From Monday begins an agenda of the importance of the various projects in Argentina. Economy Minister Sergio Massa will not need to come to Paris to sign the agreement. It was digitally signed.
Source: Clarin
