Macri Has No Plans to Settle With Argentina Holdouts Immediately

Argentine presidential candidate Mauricio Macri would make returning to international markets a priority but probably wouldn’t settle with holdouts in the first days of office, a campaign adviser said.

“It’s a priority to regain access to capital markets, but that doesn’t mean we’ll settle at zero hour,” Juan Curutchet, an aide to Macri and also vice president at Banco de la Ciudad de Buenos Aires, said Thursday in a panel discussion organized by the Association of Company Directors. “They won’t have it so easy. We won’t just give away Argentina’s money.”

Macri, an opposition candidate who is mayor of the city of Buenos Aires, recognizes that Argentina must return to international markets so the government and companies can borrow at lower interest rates, Curutchet said. Yet there will be a tough negotiation process as “every extra dollar for the holdouts is one dollar fewer for our investment projects,” Curutchet said.

President Cristina Fernandez de Kirchner, who is ineligible for a third consecutive term, has been unwilling to settle with creditors who rejected Argentina’s efforts to renegotiate debt after its 2001 default and won the right to repayment in a U.S. court.

Macri is second in polls after Buenos Aires province Governor Daniel Scioli of the ruling Victory Front alliance. Bonds rallied earlier this year when Macri led voter surveys.

Both of the leading candidates will “face the daunting task of obtaining an agreement with holdout investors that is palatable enough to be approved by Congress,” Goldman Sachs Group Inc. economist Mauro Roca said in a report Thursday.

Macri doesn’t rule out the need to devalue the peso because he wants to lift capital controls and let the currency reach a market-based rate, Curutchet said.

It wouldn’t be taboo for companies to turn a profit, and Macri would support a clear legal framework and fewer regulations to promote investment, Curutchet said. After “distrusting businessmen like a fox in a hen house, we ended up with no foxes and no chickens,” Curutchet said.

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