The president of the state oil company YPF, Guillermo Nielsen, raised the possibility of connecting Argentina’s gas pipeline network with that of southern Brazil, during the World Economic Forum in Davos. The project “would help Argentina deal with a debt that is the largest of the last 30 years,” he said. Brazilian Economy Minister Paulo Guedes welcomed the suggestion by saying that “we are going to try to connect with Vaca Muerta”.
The “formation of external assets of the non-financial private sector” last December was negative ($153 million) for the first time in three years, according to data from the Central Bank (BCRA) Exchange Balance. What is known as “capital flight” totalled $26.9 billion in 2019, just 1% below the 2018 historical record, and between December 2015-November 2019, was $88.4 billion, almost double the current BCRA reserves.
President Alberto Fernández sent to Congress the draft of the so-called Law of Restoration of the Sovereign Debt Sustainability. The bill gives power to the Government for managing liabilities, swaps or restructuring of bonds maturities under foreign law. “Today we have an unsustainable debt burden. This bill will give us the conditions to structure and execute the operations needed with the aim of restoring public debt sustainability”, said Economy Minister Martín Guzmán during a press conference.
Argentina Central Bank (BCRA) sold $120 million net during the five working days of last week, after the peso closed below 60 per dollar. The bank’s intervention indicates that officials will engage to try and avoid a dramatic slump in the peso, in addition to the so-called ‘cepo’ or currency controls put in place during the final months of the Mauricio Macri government.