Category: Argentina

in Buenos Aires, July 27-28 2005 for LatinFinance’s Cumbre Financiera Argentina. Apply for an invitation today for this high-level, invitation-only summit created to advance discussion and debate on the imminent recovery in the Argentine private sector and challenges to international investment.

Argentina faces a new $20 million claim with the International Centre for Settlement of Investment Disputes (ICSID), this one with Asset Recovery Trust, a company based in Argentina but financed by US and German investors. Asset Recovery Trust accuses Banco of Mendoza of illegally canceling a contract in 2003 and expropriating funds. Argentina faces 35 other claims filed with the ICSID, all of them related to government action in 2002 as the country suffered an economic meltdown.

The Spanish-Argentine oil and gas company Repsol YPF will halt new investments in Bolivia until general elections, expected in December, are held. Bolivia’s new president, Eduardo Rodriguez, has been running a caretaker government since ex-president Carlos Mesa resigned earlier this month. Repsol officials say the company will reevaluate investment opportunities as the presidential campaign heats up

Argentina’s GDP expanded a robust 9.8 percent year-on-year in April, beating the central bank’s projection of 8.9 percent. The economy grew 9.0 percent in 2004. Government officials are hoping to secure a new loan agreement with the IMF but are hesitant to implement new economic reforms demanded by the Fund. IMF Managing Director Rodrigo Rato says Argentina must trim its budget and boost savings.

Argentina’s Economy Minister Roberto Lavagna said the country is ready to begin talks with the International Monetary Fund on a new loan accord, but won’t accept IMF demands that would threaten the country’s economic growth. The fund last year put on hold a $13.3 billion loan accord with Argentina while waiting for the country to restructure $104 billion in defaulted debt. In February, 76 percent of bondholders agreed to the country’s restructuring offer. The fund is now pressing the Kirchner government to negotiate with holdout investors, including billionaire Kenneth Dart who tried to holdup the restructuring in US courts.

Moody’s raised its debt rating on Spanish-Argentine oil company Repsol-YPF from Baa2 to Baa1, citing the company’s “solid” financial profile, its assets diversifying strategy and the improvement of its operations in Argentina. The company has recently invested in Trinidad & Tobago, Algeria, Libya and elsewhere in the Medium East.

Argentina raised the minimum state pension by 16 percent to $122 a month, at a cost of $250 million this year. The government will pay for the increase out of its primary budget surplus. President Nestor Kirchner is still trying to meet workers’ and pensioners’ wage demands four years after the country’s 2001-2002 crisis cut purchasing power more than 20 percent.

Argentina must reach agreement with the International Monetary Fund before the World Bank will release $870 million in loans, said World Bank Vice President Pamela Cox. Last year the World Bank approved $2 billion in loans for Argentina, but has disbursed only $330 million so far. The IMF is pushing Argentina to come to terms with holdout investors, including billionaire Kenneth Dart, who did not take part in the country’s debt restructuring.

Argentina’s Supreme Court ruled that two immunity laws covering military officers accused of human rights violations during the 1976-83 dictatorship are unconstitutional, allowing hundreds of lawsuits to be reopened. An estimated 30,000 people were killed or disappeared under the dictatorship.

Argentina plans to seek a new loan agreement with the International Monetary Fund that would allow increased government spending. The country’s current agreement with the IMF stipulates it run a primary surplus of three percent of GDP, but government officials argue that figure is excessive and hope to negotiate it down in discussions with the Fund. President Nestor Kirchner is facing pressure from government employees who are demanding increased wages, even after receiving a 15 percent pay raise last year.