The International Monetary Fund has warned Argentina that its legal defeat against hedge fund investors may have wider implications.
Buenos Aires has already agreed a restructuring plan with the majority of its investors holding its defaulted debt.
But on Monday, the US Supreme Court sided with the remaining bondholders, who have refused to cut a deal. They are demanding that Buenos Aires pay them almost 950 million euros.
“We can’t be prevented from honouring the commitments we’ve made with our creditors and bondholders who agreed to the restructuring of our debts. That’s 93 percent of our creditors who are collecting payments, and have collected them on time and have control of their bonds. So we won’t allow ourselves be stopped from paying our debts,” said Axel Kicillof, Argentina’s Economy Minister.
The rating agency Standard and Poor’s has cut Argentina’s credit rating two notches, which makes a default more likely.
The country has been unable to raise funds on the international markets since its 2001-02 default.
In 2005 and 2010 investors holding over 92 percent of Argentina’s defaulted debt agreed to write off two-thirds of their pre-crisis value.
Get a different perspective
Every story can be told in many ways: see the perspectives from Euronews journalists in our other language teams.