- Approval of bill would clear way for return to capital markets
- Voting expected to happen at about midnight in Buenos Aires
Argentina’s senate is debating a bill that seeks to end a 15-year dispute with holdout creditors from the nation’s default in 2001 and would clear the way for a return to international credit markets.
The debate is expected to culminate in a vote at about midnight, according to senate officials. Lawmakers in the lower house have already sanctioned the accord with the holdouts and gave their permission to issue about $12 billion in debt to finance the payments.
President Mauricio Macri, who assumed office in December, is trying to bring an end to a dispute that has left Argentina isolated financially, starving the nation of foreign currency as it posted the largest fiscal deficit in 20 years. While the opposition holds a majority in the senate, the government will probably obtain the necessary votes since senators answer to provincial governors who also need access to international credit, Eurasia Group’s Daniel Kerner wrote in a report on Tuesday.
The default on $95 billion of debt in 2001 was at the time the biggest in history. A court ruling last year that Argentina couldn’t pay other bond holders before the holdouts sparked a second default.
Any solution still runs the risk of derailment if an appeals court hearing scheduled for April 13, one day before the agreed deadline to pay the litigators, decides to reverse a court decision to lift the injunctions that prevent Argentina from paying some of its other creditors.