Open the door, international masters of finance: Argentina is making progress on coming in from the cold. The NYT reports:
Argentina has agreed to pay $4.65 billion to four hedge funds on Monday in a deal that could put an end to more than a decade of mudslinging and legal attacks.
The hedge funds, which include the billionaire Paul E. Singer’s NML Capital, are the last among of group of investors that declared legal war on Argentina in the United States 12 years ago. These holdouts, so named for their refusal to partake in Argentina’s two restructurings after it defaulted on $100 billion of debt in 2001, sought billions in bond repayments and eventually succeeded in preventing Argentina from paying any of its creditors.
This, however, is not the end of the story. In order for this deal to go through, Argentina’s legislative body still must OK it and “repeal several laws put in place by the previous administration that barred it from making such settlements,” as the FT put it.
Still, this progress is welcome news, and for Argentina, it comes not a second too soon. Ms. Fernández de Kirchner left the country’s finances in sorry shape, and the nation has been hit by the commodities crash. Is neighbors, particularly Brazil, are also hurting, and South America as a whole appears poised for some rough times ahead. President Mauricio Macri is working to stabilize his country’s financial situation and to enable Argentina to reenter global markets. The U.S. should respond by offering whatever help it can to aid both Buenos Aires and the region in weathering the coming storm.