Amid wrangling with creditors to reach an agreement on restructuring of some 68 billion dollars in foreign loans, Argentina has failed to pay a key instalment.
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Argentina’s government failed to meet an interest payment on government bonds of around 500 million dollars, the Ministry of Commerce said in Buenos Aires on Wednesday.
The country has another 30 days to reach agreement on debt restructuring.
The government wants both debt repayments and interest payments to be put on hold for three years.
An international creditor group has rejected Argentina’s latest proposal, raising concerns that the country could default on its foreign loans.
Argentina faces a serious economic crisis, suffering from an inflated state apparatus, low industrial productivity and a large shadow economy, depriving the state of tax revenue.
The International Monetary Fund recently declared the south American country’s debt unsustainable and predicted a 5.7 per cent decline in its economic power this year.
The government recently imposed far-reaching restrictions on the economy and virtually paralysed it for weeks with its coronavirus response.
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