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Argentina seeks debt payment delay
July 22, 2014, 2:48 am

Kirchner has previously referred to hedge fund creditors as "vultures" [Xinhua]

Kirchner has previously referred to hedge fund creditors as “vultures” [Xinhua]


The Argentinian government petitioned a US judge Monday to delay a Supreme Court order requiring Buenos Aires to repay a $1.3 billion debt to hedge fund creditors and defaulted bonds.

Argentinean President Cristina Fernandez De Kirchner has said that her government is looking for a “global resolution” with investors who agreed to a restructured debt settlement and those ‘holdout’ creditors who refused to the renegotiated payment, and therefore could require more time than the current July 30 payment deadline.

The Argentinian petition focuses on helping Buenos Aires avoid liabilities as it reconfigures debt payment.

US District Judge Thomas Griesa had ordered Argentina to first pay the holdout creditors of defaulted bonds before scheduling payment to those investors who agreed to restructured debt.

Argentinean President Cristina Fernandez De Kirchner said she would only repay those who accepted the country’s offer for a partial compensation, referring to the hedge funds as “vultures” in an earlier statement.

Holdout creditors like Aurelius Capital Management and NML Capital Ltd, divisions of billionaire Paul Singer’s Elliott Management Corporation, refused to accept two debt-restructuring offers, after Argentina defaulted on a $100 billion debt in 2002 and fell into a serious economic crisis.

Since then they have been immersed in a fierce court battle with Argentina, the second largest economy in Latin America.

Kirchner said the court ruling as it stands risks to destabilize Argentina, its citizens, and its investors, most of whom are American.

Argentinean lawyers argued in a petition filed with the Supreme Court that, “full payment of the holdouts would cut Argentina’s reserves approximately in half”.

On July 19, Argentina received $7.5 billion in loans from China during a visit from Chinese President Xi Jinping.

Griesa is scheduled to hear out petitions from Argentina’s lawyers and banks on Tuesday.

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