“Hold-out deal in Argentina makes solving debt crises more difficult, UN rights experts say”

In the context of the Argentinean Congress discussing the implications of a proposed agreement between Argentina and hedge funds, the Independent Expert on the effects of foreign debt on human rights, Juan Pablo Bohoslavsky, and the Independent Expert on the promotion of a democratic and equitable international order, Alfred de Zayas, have decided to issue the following statement: …”The Argentinean offer to pay $ 4,65 billion to hedge funds holding bonds it defaulted on 14 years ago will increase moral hazard and encourage disruptive hold-out litigation worldwide…A settlement would validate the type of predatory litigation that has been on the increase during the last decade…Only recently…the Human Rights Council expressed in a resolution its concern that repayment of vulture funds may undermine the capacity of Governments to fulfil their human rights obligations in the field of social, economic and cultural rights.1 The message of a deal would be that it pays off refusing to participate in debt restructuring processes by holding out on the public debt of an insolvent State.”…