Publication

When Argentina defaulted on its sovereign debt in 2005, it left itself with a financial problem it continues to struggle with. Private creditors are still owed up to $15 billion dollars, but Buenos Aires does not recognize the remaining private debt in its official financial statements and is legislatively barred from making another offer to the creditors, who are mostly bondholders. The unsurprising result of this impasse has been further litigation, ‘Band-Aid’ legislation, and retroactive policy adjustments. There are lessons to be learned here, argues the author,that is if the country hopes to avoid similar defaults in the future.