Stiglitz again calls for debt deal: 'Argentina's creditors have no shame'

Nobel laureate in economics Joseph Stiglitz has criticised Argentina's private creditors , saying they have "no shame" in their quest to seal a deal with the crisis-stricken country.

The bondholders, with whom the Argentine government is trying to restructure foreign debt totalling more than US$66 billion, "have a short-term perspective," the US economist argued at a virtual conference organised by the Andean Development Corporation (CAF) commemorating its 50th anniversary.

"This short-termism is being reflected in the debt negotiations with Argentina, with some creditors demanding money that exceeds what is sustainable," Stiglitz said Thursday.

"I am going to say it in frank terms: they have no shame," he said according to a live translation in Spanish that accompanied the virtual conference.

For Stiglitz, the private sector "tries to strangle countries irrationally." 

"This is not only inhumane but undermines the recovery that can be obtained. Creditors have opposed the development of a good human and rational framework for debt restructuring."

The economist stressed that, in the past, when the restructuring has not been sustainable, "after five years, half of those countries faced a crisis again." 

"This is seen very vividly in Argentina, which played a very important role with the International Monetary Fund developing models in which we can assess the situation. Unfortunately, once again, we are seeing the failure of the private sector," he added.

– TIMES/AFP