BUENOS AIRES, Argentina (AP) – Argentina will make its next round of scheduled debt payments, the economy minister said Wednesday as he defended a new plan to pay creditors locally and avoid the jurisdiction of a U.S. court that forced the country into default last month.
Under legislation that still must be submitted to Congress, the country will no longer use the Bank of New York as a trustee for about $30 billion in bonds and will service debt through an Argentine bank, Economy Minister Axel Kicillof said.
The change will allow the country to make $200 million in interest payments scheduled for Sept. 30 to those bondholders who voluntarily accept the change, Kicillof said a day after President Cristina Fernandez announced the new plan.
The economy minister sought to minimize the scope of the plan, saying it amounted to “a change of venue, not jurisdiction,” but it could allow the country to emerge from default while complicating a bitter legal dispute with U.S. investors.
The proposal is intended as a way around a U.S. court order that blocked Argentina from making $539 million in interest payments on July 30, triggering the country’s second default in 13 years.