IMF chief: Argentina is acting in good faith with bondholders

Argentina is acting in good faith and wants to reach a debt-restructuring agreement with its foreign creditors, says Kristalina Georgieva, the managing director of the International Monetary Fund.

"They are going to present a proposal because they don't want to default. They want to find the way to an agreement with the creditors," Georgieva told Bloomberg's Vonnie Quinn in an interview on Thursday.

Georgieva said that she had not personally spoken with Economy Minister Martín Guzmán lately, but said her team was in close communication with Argentine officials.

The government is expected to make its first formal proposal to foreign creditors later today, with officials seeking to restructure close to US$69 billion in bonds issued under foreign law.

President Alberto Fernández told Perfil in an interview over the weekend that the government's proposal to creditors would be fair and reflect the economic impact of the coronavirus pandemic in Argentina. The country's bonds have fallen and are trading below 30 cents on the dollar amid a wider global sell-off related to the coronavirus pandemic.

Argentina's holds a US$56-billion credit-line with the IMF and at some points, talks over a new programme with the Fund will have to take place. To date the country has received US$44 billion.

The IMF has declared that Argentina's debt is unsustainable and has asked foreign creditors to make a "significant contribution."