The Buenos Aires Province government said in a statement Thursday that it asked the region’s creditors to act in “good faith” towards a restructuring deal and deliver a counter-proposal, as it allowed the grace period on a payment to expire.
The province, which is negotiating with bondholders for the restructuring of US$7.148 billion in total debt, said it was not paying a maturity of US$110 million, inviting creditors to deliver a “plausible” counter-proposal instead.
A statement from the provincial government, headed by Governor Axel Kicillof, said that they were acting in “good faith” and “making a great effort to advance a solution that involves the vast majority of bondholders."
The province’s offer, first presented in April and rejected by bondholders, included a three-year grace period, a reduction of 55 percent in interest, and seven percent cut on the principal. Its deadline has now been extended to May 26.
The provincial government is conducting its negotiation in parallel with the national government’s attempts to restructure more than US$65 billion in debt.
"The province's ability to pay is very limited," said the provincial Economy Ministry, highlighting that poverty on the outskirts of the region "exceeded 40 percent of people" before the COVID-19 pandemic.
Buenos Aires Province, where some 17 million Argentines live, is home to a large part of Argentina’s industrial and agricultural sectors, but has high poverty rates.
"We maintain a continuous dialogue with those creditors who have not yet accepted the proposal and have asked them for a counter-proposal that is plausible to implement in the framework of the serious situation that the province is going through and in the framework of sustainability that we have defined," said the Kicillof administration.
"Now it is up to them to achieve the necessary agreements that allow us to move forward," it added.