BUENOS AIRES: Argentina's economy minister blasted a US court ruling that would force the country to repay creditors who have sued to collect on defaulted Argentine bonds, saying the country will never pay the "vulture funds."
The South American country staged the world's biggest sovereign debt default in 2002 during a deep economic crisis. It has restructured about 93 percent of the roughly $100 billion in default through debt swaps launched in 2005 and 2010.
But "holdout" creditors who rejected the swaps continue to press in courts worldwide for full repayment on the bonds.
On Friday, a federal appeals court in New York ruled that Argentina violated bond provisions to treat all creditors equally when it made payments to creditors who accepted the swaps while refusing to pay the holdouts.
"We are never going to pay the vulture funds. Anyone who thinks otherwise hasn't understood a thing," Economy Minister Hernan Lorenzino said via Twitter late on Monday.
"We're going to continue paying the 93 percent of creditors who entered the swap, in dollars, euros and yen we will not be pushed into the trap of default," he tweeted.
Argentina refers to investment funds that buy distressed or defaulted debt and then litigate to be repaid in full as vulture funds.
The ruling initially sent Argentine bond prices reeling, widened the country's risk spread as measured by JPMorgan's EMBI+ bond index, and pushed t h e price of protection against an Argentine default to a nearly four-year high.
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