Argentina's return to the international capital market marks a positive comeback of an old trusted client of the global financial system, an economist has said.
Argentine President Mauricio Macri said earlier that it is vital for the country to make payments to its impatient creditors and retain access to the global capital market. Foreign lenders have been frustrated after being stonewalled by former President Cristina Fernandez de Kirchner for years, Gustavo Girado explained.
"After Macri took office in December, the U.S. State Department said it would stop opposing Argentina from accessing international loans, just a week before President Barack Obama's visit in March," he told Xinhua.
"Argentina's rapid change of tune in terms of its debts ... has led to a rapid agreement with its bondholders, something the country has not done before." However, the expert warned that President Macri's determination to borrow internationally to finance the nation's programs would re-open a door for capital flight, a problem that has plagued Argentina for years.
"In order to regain international trust, Argentina is following a path desired by financial entities. However, as inflation rises without stop and interest rates on the rise, financial activity within Argentina is dropping.
More people are getting fired, poverty is rising, and foreign goods are claiming more spaces every day," Girado said. He warned that the situation will lead to economic slowdown and make Argentina not an attractive investment destination for foreign capital.
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