In 2013 the Government used the reserves of the Central Bank to pay off the debt maturities. In exchange, delivered a non-transferable invoice to the BCRA for a period of 10 years. It canceled private debt by assuming a debt with the BCRA, crediting it to an account paradoxically called the “Debt Reduction Fund”, when in reality what is happening is a change of creditor.
Now, after that 10-year period, the Government has renewed the debt or the Non-Transferable Law for another 10 years: “Issue of one (1) “Non-Transferable National Treasury Bill in US Dollars maturing January 16, 2033”, to be delivered to the Central Bank of the Argentine Republic (BCRA), within the framework of the provisions of Article 82 of Law 27.701 of the Budget of the National Administration for the year 2023, for an amount up to the original face value of US dollars seven thousand one hundred thirty two million six hundred and fifty five thousand twelve thirty nine cents (VNO USD 7,132,655,012.39)…”, reads the Joint Resolution 3/2023 of the Ministry of Finance and Treasury published today in the Official Gazette.
In the explanatory memorandum to the Resolution it is stated that in addition to interest service payments and principal depreciation of bills denominated in US dollars which are issued under the regulations mentioned in the preceding paragraphs shall be replaced, on the expiry date, for new government bonds the conditions of which will be defined jointly by the Ministry of Finance and the Ministry of Finance, both dependent on the Ministry of Economy.
Non-Transferable National Treasury Bills deposited with the Central Bank have one particularity: the creditor, in this case the BCRA, you cannot transfer or sell them to another personboth physical and legal, and in fact You must hold them in your equity, as another asset, until maturity. And then you can renew them indefinitely.
Among the most important operations carried out in this way – use of reserves in exchange for non-transferable bills -, the payment in 2006 of the debt with the International Monetary Fund (IMF) stands out.. Then, US$ 9,530 million from the BCRA was used to cancel obligations with the multilateral credit institution and the cards the bank received, which it must keep as part of its assets, expired in 2016. In the same year they were renewed until 2026.
Now the debt to the IMF is 45,707 million dollarswhile US$9,530 million owed to the Central Bank which served to cancel the debt to that international financial organization in 2006.
NS
Source: Clarin
