Argentina wants to resolve negotiations with the Paris Club group over defaulted debt before April to help boost investment in South America’s second-biggest economy, Finance Secretary Hernan Lorenzino said.
Economy Minister Amado Boudou will seek to agree on a negotiating schedule with the Paris Club over about $6.7 billion in defaulted debt in the first half of December, Lorenzino said in an interview in Buenos Aires today. An accord would remove an “obstacle” to investment in Argentina by companies in energy and infrastructure, Lorenzino said.
“This would remove an obstacle for companies that want to invest in the country, which is growing about 9 percent,” Lorenzino said, citing interest by companies in energy, roads and infrastructure. “I’m optimistic that there is goodwill on both sides” to resolve the debt, he said.
Foreign direct investment in Argentina is among the lowest in South America’s major economies, totaling $2.2 billion in the first half of 2010 compared with $17.1 billion in Brazil, $8 billion in Chile, $4.1 billion in Colombia and $3.4 billion in Peru, according to the Santiago-based United Nations Economic Commission for Latin America.
The Paris Club is an informal association of creditors that includes Germany, Japan and the U.S. The group met for the first time in May 1956 to help resolve Argentine debt problems, according to the organization’s website.
President Cristina Fernandez de Kirchner said Nov. 16 that the Paris Club agreed to begin talks on the debt, which dates back to the country’s 2001 financial crisis, without oversight of the International Monetary Fund.
In 2008 her plan to pay the debt with central bank reserves was abandoned after the bankruptcy of Lehman Brothers Holdings Inc. and the start of a global financial slowdown.