Debt restructuring efforts in Argentina’s provinces illustrate a national rift in fiscal policy that will likely decrease investor confidence in the country’s financial security. In September, Argentina’s national government reached an agreement with its private creditors to restructure almost $65 billion of sovereign debt. Once the majority of national debt was restructured, the country’s provinces were freed to restructure their own debts. 12 of Argentina’s 24 provinces entered into negotiations in 2020 to restructure a total of $13 billion in international law bonds. All 12 of those provinces have indicated their reasoning for seeking debt relief is due to an extended national recession and heightened fiscal pressures related to the COVID-19 pandemic. The internal pressure to spend and lack of assistance from national leadership has put significant financial strain on the provinces over the course of 2020. ...
