Argentina reaches key breakthrough during Paris Club talks

By Bala Chambers

BUENOS AIRES (AA) - Argentina made progress Thursday during negotiations with the Paris Club as the country seeks to renegotiate $2.4 billion in debt that it owes to the group of creditor nations.

An agreement is expected to be reached by the end of October following discussions in Washington, D.C. between Argentina's Economy Minister Sergio Massa and the chair of the Paris Club, Emmanuel Moulin.

"The agreement is almost closed. There are very good prospects," an unnamed source from Argentina's economic team told local news agency Telam.

The said Massa is expected to travel to France on Oct. 27 and 28, insisting "there are very good prospects for closing the agreement.”

October's negotiations are expected to center on the repayment schedule and interest rate for the loan, according to Ambito Financiero, one of Argentina's main economic newspapers.

Following Thursday's meeting, Massa announced on Twitter that he held a working meeting with Moulin "to advance in the resolution of the Argentine multilateral agenda."

Argentina has been pushing to refinance the $2.4 billion debt and has sought to extend the terms and reduce the interest rate, which is around 9%.

According to the unnamed source cited by Telam, the 9% annual interest rate includes a penalty fee for late payments which could be lowered by the time the deal is expected to be agreed to in late October.

Last year, the Paris Club granted Argentina more time to settle the debt, giving the country time to focus its efforts on negotiating a new deal with the International Monetary Fund (IMF), according to Ambito Financiero.​​​​​​​

The Paris Club group of creditors includes the governments of the US, Germany and Italy.