Changes in the calculation of GDP, lawsuits with unpaid sentences to creditors, problems in expropriations. Kirchnerism continues to accumulate court decisions whose economic cost is measured in the billions of dollars. In less than a week, the Argentine state has been called to pay more than 1.3 billion dollars in London and an amount not yet determined – but billions – in New York.
Since these cases are long-standing – the expropriation of YPF dates back to 2012 – there are still appeals that will delay the trials. In the case of YPF, the payment should be made in 2024. Judge Loretta Preska must establish how much the prize against Argentina reaches. But she has already warned that a deposit will have to be left.
The expropriation of YPF continues to be a major source of expenditure. Former Economy Minister Axel Kicillof, now governor of Buenos Aires, has compensated the Spanish company Repsol with 5 billion dollars for its stake in the oil company. Payment was made in public debt securities. If the respective interests are added, the compensation could reach 9,000 million dollars.
Kicillof, who criticized the US judiciary for the Repsol sentence, is the author of other actions that have generated adverse judicial reactions. In 2015 there was a ruling in favor of Argentine debt creditors who had not entered into the public debt restructuring of 2005 and 2010. They called them “holdouts” and Kirchnerism called them “vulture funds”.
The creditors went to Judge Thomas Griessa, of the Southern District Court of New York, and obtained a favorable sentence. Former president Cristina Fernández de Kirchner and current vice president, has decided to ignore that ruling. But the next administration, that of Mauricio Macri, wanted to recover access to external credit. And this was not possible with the “resistance” embargoes on Argentine goods (as happened with the Fregata Libertad).
To settle the resistance, the Macri administration had to shell out 18,000 million dollars. The agreement was ratified by Congress and paved the way for Cambiemos management to regain access to international credit.
Between 2007 and 2014 there was also a statistical manipulation of the INDEC data. There some indicators have been changed. For example, the year-over-year improvement in GDP. As part of the 2005 debt restructuring, former Economy Minister Roberto Lavagna offered an “increasing” coupon. The proposal aroused enthusiasm. Creditors would get a head start if the country grows more than 3.26% annually. During the first few years, it was accomplished. But then INDEC changed its statistics -at the hands of Guillermo Moreno, now very critical of Alberto Fernández and Cristina Fernández de Kirchner-, and the creditors lost that sweetener. There has also been a lawsuit that will cost no less than $2,000 million.
Kicillof has also achieved another “achievement” in his management as economy minister. He was with the Paris Club, a group of European creditors. As of April 30, 2014, the overdue debt with the Paris Club amounted to US$ 4,955 million. However, the settlement was for US$9,690 million: the difference is due to interest of US$1,102 million and default interest of US$3,633 million. Thus, the interest account increased the principal owed by 95.6%.
There is also the so-called “future dollar” cause. The Central Bank sold dollars in the future – for when its management ended, after December 2015 – at a price that ended up being lower than the price reached at that moment. The government used the official dollar ($10 at the time), even though the “informal” price of the banknote – the one used by savers and many economic players – was $15. billion.
Source: Clarin
