Belgian export credit agency ONDD has resumed cover for medium and long-term transactions with the Argentine private sector. It applies to highly productive projects, which have priority for the economic development of the country and which are relevant for the Belgian economy.

The cover ceiling for Argentina amounts to €90mn for these transactions. Within the framework of the OECD arrangement, the premium category for medium and long-term credit transactions remains unchanged (category 7 out of 7).

Argentina gradually recovers from the 2001 financial crisis, which had plunged the country into bankruptcy. A strong growth together with a control of the inflation, a low but competitive real exchange rate of the peso, a stimulating monetary policy and a cautious budgetary policy in a context of political stability have given a boost to the Argentine economy, which is now close to its potential, says ONDD.

The renewed confidence of investors shows that the medium and long-term economic prospects are encouraging, it adds. Moreover, the exchange of sovereign debt – mainly held by private investors – concluded in February 2005 has allowed Argentina to reach a more bearable foreign debt level, which enables the resumption of cover for credit transactions with the private sector.

However, this resumption of cover does not apply to the public sector given the continuous accumulation of arrears on its bilateral debt.