‘Economic Sovereignty’ Costs Argentina’s Kirchner at Home and Abroad

‘Economic Sovereignty’ Costs Argentina’s Kirchner at Home and Abroad

BUENOS AIRES, Argentina -- On Wednesday evening, hours before she flew to Havana to symbolically visit regional ally Hugo Chávez, Argentine President Cristina Kirchner was in Mar del Plata, Buenos Aires province, to celebrate the return of the naval ship Libertad. The ship had been impounded in Ghana at the request of NML Capital -- an unpaid creditor from Argentina’s $100 billion default in 2002.

The frigate’s homecoming, facilitated by an international maritime court ruling, was a victory for Kirchner’s self-proclaimed “national and popular” project. Her government refuses to pay so-called vulture funds such as NML, which bought up debt at a vastly reduced rate when Argentina was on the edge of collapse, and has appealed against a recent order by an American judge to do so.

While NML and others continue to hold out, embargoing a total of 28 government assets in an attempt to force Kirchner’s hand, more than 90 percent of bondholders accepted a 70 percent haircut during the debt restructurings of 2005 and 2010, and Argentina is rigorously honoring its payments to them.

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