They are not metaphors, all we see is a political experiment with the smell of Casino, executed by exegutive finance that do not understand the difference between a sovereign state and a money table. As Lewis points out: “In the negotiation room of Wall Street, the truth is an unnecessary luxury. The essential thing is that the other creates what is convenient to create.” The current economic team of the president Javier Milei It is a kind of JP Morgan Reloaded (recharged). There is no economic plan, there are payroll. There is no political driving, there are Bloomberg boards. There are no public policies, there are bets.
In the first semester of 2025, the macropinanciera situation of the Argentine Republic exhibits an accelerated deterioration, marked by a combination of public debt maturities, increasing uncertainty of investors by the medium term elections and a financing architecture that becomes progressively unfeasible, beyond the strict of the Credit Rating Companies that assigned AAA to Banks to the Bank of Bankruptcy in 2008. This context, the National Government, through the Ministry of Finance, has launched a series of instruments under the figure of “voluntary conversion”, whose purpose declared is to extend the expiration deadlines of bonds in pesos. However, this strategy has been received with skepticism by market agents, who interpret it as a undercover impact and an unequivocal symptom of the vulnerability of the Argentine State to fulfill its commitments.
This article analyzes Argentina’s degree of financial fragility before an eventual breach, evaluating the sustainability of its public debt and the consequences of current financing strategies. From a systematization of the available fiscal and financial data, and the historical experience of the country, it is argued that the so -called “friendly offers” constitute a transition to restructuring scenarios, whose viability will be conditioned by endogenous and international factors.
Indebtedness and structural fragility
Argentine public debt has followed an upward trajectory since the end of 2023, accentuated by the combination of tax adjustment programs, falling economic activity and financing needs that failed to be resolved with genuine income. As of April 2025, the debt/GDP ratio is estimated around 97%/100, although this figure is subject to volatilities due to the impact of inflation and the variation of the real exchange rate. Remember that a devaluation today, impacts more given the proportion of debt in dollars on debt in pesos, than in 2023.
As for the composition, there is a preeminence of instruments in local currency, adjusted by CER, fixed rate or linked to the exchange rate. This architecture significantly increased the risk of rollover, since the maturities are concentrated in the short term. In particular, between May and December 2025, The Argentine State faced maturities higher than $ 66 billion, with a monthly charge of interest evolving according to renovations and deadlines. As a complementary data, in the first 2026 quarter they expire $ 16,070 billion, with the burden of interest implies its renewal. In total until March 2026, $ 82 billion expires.
The external situation is no less worrying. The current year presents commitments in titles issued under foreign legislation (in June expires US $ 4,500 million that are also intended to be raised), whose coverage has not yet been guaranteed. After a spectacular agreement with the IMF, the risk-pais, does not fall from 678 basic points, reflecting the perception of investors with respect to an eventual default accident.
“Voluntary conversion” as a form of undercover impact
On May 6, 2025, the Secretary of Finance, Pablo Quirno, announced a new Tzx26 Bonce Titles conversion operation for the Dual Tamar TTD26 bonus, expiring in December 2026. This operation seeks to extend the “duration” of the treasure commitments, in order to release box and improve the management of the liability in the short term.
While the conversion was presented as a voluntary tool, its nature is functionally resembled to an impact. In the financial sector, stretching “duration” is to impact the debt, thus voluntary and non -compulsive, all reperfelling of the public sector, although it is called ‘friendly’, impacts the markets. ”The speculative nature of the measure with respect to the precedents of 2019, when Mauricio Macri and his Minister of Economy impleme New denominations. systemic.
Policy inconsistencies: How to remumding with distrust signs?
One of the axes of the official discourse is to promote a remumination of the economy, that is, increase monetary circulation in the hands of the public and the private sector, as a mechanism to boost consumption and investment. However, this strategy enters into contradiction with the signals that the Treasury issues the market through debt reconversion operations.
Effective placement rates have increased sustained. These fees, in a context of recession and exchange appreciation, stress the sustainability of the tax adjustment. In terms of impact, “The treasure strategy of releasing liquidity for the private sector” (by not renewing 100% of the maturities-the last one was only 70% rollover) contradicts its need to capture funds to finance. But do not worry, yesterday the strategy changed again, there was oversupply of pesos with rollover of 134%…. This discursive inconsistency mine the credibility of the program, in the long run or short.
Default risk: scenario without “associated probabilities of occurrence ‘zero‘“
The convergence of mentioned factors configures a scenario of high financial vulnerability. The lack of access to the voluntary debt market in foreign currency, combined with significant maturities in 2025, configures a picture in which an unwanted breach cannot be ruled out.
There are two possible channels for paying for payments: an internal one, through the impossibility of renewing maturities in pesos (which would force compulsive exchange); And another external, if the government does not achieve access to sufficient currencies to face foreign law bond payments. In both cases, risk perception can trigger capital outflows, increased risk-pais and a spiral of distrust that revives the ghosts of 2001.
From a historical perspective, the current case shares structural elements with the processes of 2001 and 2019: fiscal deterioration, illiquidity, use of semantic instruments to avoid the word “default” and the absence of a credible stabilization program. As Reinhart and Rogoff (2009) show, default episodes are rarely surprising; Rather, they are the outcome of predictable trajectories of unsustainability.
The combination of a deceleration of the growth rate, a tax collection of consumption (in 7% drop in March) and high financing needs could generate a series of negative effects on the economy, that is, an increase in public debt with its correlative increase in the cost of financing.
The Argentine government attempt to prolong the life of its debt through “voluntary conversions” reflects, strictly speaking, a short -term strategy that does not resolve background dynamics: the unsustainability of the debt in a context of recession, real rates high in dollars and distrust of the markets. The semantics used, heiress of previous euphemisms, is not enough to hide a reality marked by the lack of structural solvency.
Without a comprehensive strategy that combines fiscal sustainability, access to financing and credible nominal anchor, the casual, technical or formal non-compliance scenario becomes increasingly random. This article tries to provide another approach to unfounded optimism diagnoses, there is some vulnerability and it is necessary to anticipate other possible scenarios to promote an informed debate about the limits of Argentine financial policy.
We are naturalizing an institutional cynic culture, where talking with euphemisms is strategy, adjusting is virtue and governing is simply moving chips. The worst of Wall Street is no longer in Manhattan.
Director of Esperanza Foundation. Postgraduate professor at UBA and private universities. Master in International Economic Policy, Doctor of Political Science, author of six books
Source: Ambito
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