Argentina missed a Friday deadline to reach an agreement with international creditors to restructure its massive debt, but negotiations will continue, its economy minister said.
The two sides have been deadlocked over Argentina's US$65-billion debt, with the three main bondholder groups rejecting a government restructuring proposal, saying they were unwilling to swallow "disproportionate" losses on their investment.
"Argentina is maintaining a dialogue," Economy Minister Martín Guzmán told reporters on Friday.
A 30-day grace period for a US$500-million bond payment that Buenos Aires has already missed expires on May 22.
"The next maturity of the bonds is May 22. Only on that date, if Argentina does not comply with the payment, can it be considered in default," said Hernán Letcher, the director of the CEPA consultancy firm, told AFP.
Guzmán said this week that he is willing to listen to "any combination" in a counter offer, as long as the model is sustainable over time.
Consulting firm Capital Economics also said in a report that "there are likely to be more verbal thrusts [between the parties] from now until May 22 when the [delayed] coupon payment expires."
Guzmán has taken an aggressive stance on debt, in part driven by a need to free up resources to fight the novel coronavirus pandemic in the recession-hit South American grain and beef exporter.
He said this week that his government, though willing, "does not have the capacity to pay."
A senior government official who requested anonymity told AFP the country would face a difficult 10 days, but that Buenos Aires was "optimistic" about reaching an agreement.
"We will do everything we can (to find a solution) without mortgaging the present and the future of the Argentines," he said.
Buenos Aires' offer to its creditors includes a 62 percent discount on interest, or US$37.9 billion, and 5.4 percent on capital, or S$3.6 billion. The country is also requesting a three-year moratorium, which would imply no payments until 2023.
Failure to pay would mean a default, a near doomsday scenario for the cash-strapped country that would prevent the government from seeking credit from the financial markets.
Argentina, which has been gripped by recession for two years, has also been in lockdown since March 20, further damaging its already battered economy.