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Argentina defaults on bonds, blames U.S. mediator

A payment of $1.3 billion was demanded by bondholders.
By Ed Adamczyk   |   July 31, 2014 at 12:52 PM   |   Comments

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NEW YORK , July 31 (UPI) -- Argentina defaulted on its bond debt Thursday after last-minute negotiations in New York with bondholders failed.

Hedge funds NML and Aurelius Capital Management demanded a full payout, and not a reduced and restructured rate, of $1.3 billion on bonds bought during Argentina's 2001-2002 economic crisis.

Argentinian cabinet minister Jorge Capitanich called the handling of the negotiations "shameful" and U.S. mediator Daniel Pollack "incompetent." He added Argentina would denounce what he called "vulture funds" at the United Nations in New York and the International Court of Justice in The Hague, Netherlands.

"The responsibility lies with a state, that of the United States of America," Capitanich said, adding he accused the United States of "not acting in an adequate manner."

In Buenos Aires it was business as usual for citizens of an economy facing high inflation, higher costs and in January, a 20 percent devaluation it its peso. Some are frustrated by the Argentinian government's handling of the crisis, and one resident noted to the BBC that vultures live in the Casa Rosada, the Argentinian presidential office, as well.

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