Argentina Meets With Vultures and Pollack

In an effort to reach an agreement, an Argentine government delegation met with the holdout, “vulture,” funds and court-mandated mediator Daniel Pollack in New York on Thursday. Originally scheduled to be held yesterday, this was the first meeting where the two parties have met to negotiate before the fast approaching July 30 payment deadline.

The U.S. Supreme Court ruling on June 16 declared that Argentina must pay US$1.3 billion to the vulture funds by next Wednesday, plus interest. This interest, estimated to amount to US$15 billion, accounts for half of the country´s total national reserves.

Argentine Cabinet Chief Jorge Capitanich said that Argentina´s current position in the case is to “defend national dignity and sovereignty.”

President Cristina Fernandez de Kirchner maintains that Argentina has paid and wants to continue meeting its commitments to the 92.4 percent of creditors who took part in the debt restructurings of 2005 and 2010. She said, “Argentina will not default, for one simple reason. An obvious reason, so much so that it should not need to be said. Those who cannot pay default, and Argentina has paid.”

Present at the meeting with the mediator and the vulture funds were representatives from the Argentine Ministry of Economy, including Treasury Procurer Angelina Abbona, Legal and Administrative Secretary Federico Thea, and Finance Secretary Pablo Lopez.

The Argentine government attempted to make a payment of US$539 million on June 27 to Bank of New York Mellon, which U.S. Federal Judge Thomas Griesa blocked and ordered be returned to the country, under the premise that it was not destined to the holdouts as well. Griesa has ordered that the two parties meet continually until an agreement is reached.

If unable to negotiate with the holdouts or pay in full by next Wednesday, Argentina will be forced into technical default.