BUENOS AIRES Argentina will pay its entire US$6.7 billion debt to the Paris Club of lending nations in a bid to shore up sagging investor confidence, President Cristina Fernandez announced Tuesday.
The payment "confirms one more time Argentina's willingness to meet its international obligations, Fernandez told a news conference.
The move will tap some of the US$47.2 billion in foreign currency reserves that Argentina has accumulated in recent years, she said.
Argentina defaulted on about US$95 billion in bonds in 2001, the largest default in history. Former President Nestor Kirchner restructured most of that debt in 2005 and repaid a US$9.5 billion loan from the International Monetary Fund in 2006. He left the Paris Club debt outstanding, prompting criticism from international lenders.
That decision and more recent concerns that a shrinking budget surplus may keep Argentina from servicing its current debt have prompted analysts to increasingly question Argentine solvency.
The Paris Club is an umbrella group of wealthy creditor nations including the United States, France, Germany, Japan and Russia.