Argentina has completed the largest and most
complex sovereign bond restructuring in history. Before the
debt exchange, it owed about $82 billion in principal and $20
billion in past due interest. Hundreds of thousands of
creditors held 150 kinds of defaulted instruments issued in six
currencies under the laws of eight jurisdictions. Creditors
owed just over 76% of the total, or $62 billion, got $35
billion in new performing bonds. Other performing debt includes
$40 billion in domestic and about $30 billion in multi-lateral
obligations. Argentina left behind almost $25 billion in
defaulted principal and interest.
The morning after the tender, newspaper editorials around
the world heralded a new era for sovereign debt, for the
emerging markets and, occasionally, for international finance.
Their views on what the Argentina deal means were as disparate
as they were definitive. Some said the exchange would close the
markets to middle-income countries. To others, it reaffirmed
the markets' resilience. Some...