Argentina's Buenos Aires seeks three-year grace period, capital cut in debt revamp

Argentina's Buenos Aires seeks three-year grace period, capital cut in debt revamp

The provincial government of Argentina’s capital Buenos Aires will propose a three-year grace period and a 7% capital drawdown to creditors as part of a $7.148 billion debt restructuring, a local government source told Reuters on Tuesday.

The proposal, to be presented in the coming days, is roughly in line with one put by Argentina`s federal government to its own creditors as the country struggles with an economic crisis exacerbated by the novel coronavirus pandemic.

The details of the offer by Buenos Aires province, the largest in the country, were agreed after meetings the governor, Axel Kicillof, held with various mayors of the district.

The proposal includes low interest payments starting in 2023, a 55% reduction in overall interest payments between 2020 and 2027, with administrators hoping to achieve total debt relief of $5 billion between 2020 and 2030 if it is accepted, the source said.

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