Through the DNU (Decree of Necessity and Urgency) n. 23/2024, published today in the Official Journal, the Government ordered the The Central Bank grants loans to the National Treasury for 10 years in the United States$ 3.2 billion for the payment of debts in foreign currency. In exchange for obtaining these currencies, the National Treasury will deliver BCRA non-transferable letters expiring in 2034.
This way, public debt does not decrease In case of change of creditor, as indebtedness to private creditors is replaced by the Central Bank, a common practice during the K and Mauricio Macri governments.
The Government justifies the adoption of this measure through a DNU in “than the proximity of the deadlines of the aforementioned debt commitments determines the urgency in the adoption of this provision, making it impossible to continue the ordinary procedures provided for by the National Constitution for the sanctioning of laws”.
For his part, “American dollars can be acquired through this measure They can only be applied to the payment of debts denominated in foreign currency”, clarifies the DNU.
The government claims it can borrow that $3.2 billion over 10 years because due to the devaluation of the peso and the increase in reserves, The Central Bank “is currently in conditions provide U.S. dollars to the National Treasury to meet its foreign exchange obligations.”
In turn, payments of interest and capital amortization services of non-transferable securities which are in the hands of the Central Bank (for similar operations carried out during the K and Mauritius governments) “as well as those issued in favor of the said Bank during of the year 2024, will be replaced, upon their maturity, by new public bonds whose conditions will be defined jointly by the Secretaries of Finance and the Secretary of the Treasury, both of the Ministry of Economy”, states the DNU.” .
On the other hand, through a joint Resolution of the Secretaries of Finance and the Treasury (no. 1/2024), also published today in the Official Journal, a “non-transferable National Treasury Note in US dollars is issued expiring on 7 January 2034”, to be delivered to the Central Bank of the Argentine Republic (BCRA), for US$ 40,210,698.88) to meet the January 7 deadline for the expiration of the sixth interest coupon of a “Non-transferable National Treasury Note in US dollars above, released on January 6, 2021.
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Source: Clarin
