Volume 25, Numbers 3 & 4 / September/December ,
Assessment of Argentina’s Creditworthiness After the Debt Restructuring
Multinational Finance Journal, 2021, vol. 25, no.3/4, pp. 151–161
Elena Duggar , Moody’s Investors Service, USA    Corresponding Author
Gabriel Torres , Moody’s Investors Service, USA
Claire Li , Moody’s Investors Service, USA
Gabriel Agostini , Moody’s Investors Service, USA

Abstract:
Argentina’s 2020 debt restructuring was the second largest sovereign restructuring in history, after Greece’s in 2012. The sovereign’s latest default was triggered by extending maturities on short-term debt in August 2019, followed by another postponement of short-term debt payments in December 2019 and long-term debt payments in February 2020. In August 2019, the government also announced its intention to restructure its long-term debt. This article compares Argentina’s sovereign debt crisis with prior sovereign bond defaults and sets forth Moody’s view that significant challenges result in Argentina’s creditworthiness remaining weak even after the debt restructuring and despite sizeable losses for investors. These challenges include Argentina’s large share of foreign-currency debt amid its dependence on external foreign-exchange financing and limited domestic funding options, and subdued economic prospects as the coronavirus pandemic deepened the country’s multi-year recession and also affected Argentina’s main trading partners.

Keywords : Sovereign debt restructuring; sovereign debt default; country risk; creditworthiness; debt crisis.
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