Argentina’s debt load is unsustainable, the International Monetary Fund said after completing a week of meetings in the country, paving the way for the government to ask private bondholders to take on losses as it prepares to renegotiate its obligations. A “meaningful contribution” will be necessary from private bondholders to restore the country’s debt sustainability, the IMF said at the end of its first technical mission in Buenos Aires under Alberto Fernandez’s presidency.
Argentina’s central bank (BCRA) cut to 40% from 44% the benchmark interest rate (Leliq), the seventh time in 70 days since president Alberto Fernández took office in December. “The decision was taken based on the deceleration in the inflation rate, and the prospect of this trend continuing,” the bank said in its statement. On another resolution the BCRA put a cap of 55% to credit card interest.
After giving initial approval to start producing lithium from 2021 in Argentina, Eramet has postponed the mine project citing economic and regulatory uncertainty in the debt-stricken South American country. Eramet posted a 2019 net loss of 184 million euros, against a 53 million net profit in 2018.
Argentina internal wholesale price index (IPIM) registered an increase of 1.5% in January compared to December, when it was 3.7%, according to the latest data published by the National Institute of Statistics and Census (Indec). The index of internal basic wholesale prices (IPIB) increased 1.7% and that of basic producer prices (IPP) 1.9%. In the year-to-year measurement, wholesale prices rose by 60%.
The financial and economic turmoil that has plagued Argentina for so long now does not put a dampener on investors. At first glance, it seems that the VC ecosystem in the country is actually rather fired up. NXTP Ventures, Kaszek Ventures, Alaya Capital Partners, Cygnus Capital, and Patagonia Ventures are the top 5 VC funds worth to have a look at.