Rethinking Bretton Woods | Thu, Oct 15, 2015
In 2001 amidst a profound economic and social crisis carrying tremendous human costs, and after successive adjustment programs prescribed by the International Monetary Fund had proved fruitless, Argentina had little choice but to stop payments and seek a renegotiation of the terms of its sovereign debt. Eventually, it reached deals restructuring the debt in 2005 and 2010 with more than 92 per cent of creditors who took a haircut (debt reduction) of around 70 cents on the dollar. NML Capital was among those creditors who refused to accept the terms of the agreement reached by Argentina with the majority of creditors and sued the country in US courts for payment of a 100 per cent of their credits.
In an article appeared on the German Forum on Environment and Development's magazine, RBW Project Director Aldo Caliari explains how NML’s practice fits into a business model adopted by “vulture funds” and what is at stake in Argentinean attempts to fend off their judicial and political tactics. (Article is only available in German)