As the value of its currency continues to fall and its economy edges nearer to collapse, Argentina’s government is scrambling to establish new measures to protect its currency and to save the country from a long-term recession. The government recently proposed a new plan for the 2019 budget which now includes various initiatives to cut government spending.
Argentina foreign debt
After two days of intense talks leading up to the extended deadline of July 30th, Argentina was declared in default, its second in 13 years. Although various plans were proposed to avoid this result, such as coupon repayment and Argentine banks buying up the debt, Elliott Management refused any and all proposals to restructure, acting against the other 92% of creditors that accepted reduced repayments in 2005 and 2010.1 If Elliott Management would accept an offer, it would make over 150 times its initial investment.