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Hard or desperate? -

The decree "must be seen from two points of view: the debt under local law and the debt under foreign law," Claudio Loser, former head of the Department for the Western Hemisphere of the International Monetary Fund, told AFP.

“Regarding the first, and because they have authority over these papers, they can extend the terms. Only they have been tougher. This indicates either more despair or more harshness due to the situation due to the coronavirus, "he said.

 Before the pandemic turned everything upside down, it was already discounted that Argentina would seek an important debt relief, a strategy that received the backing of the IMF, an organization to which the country owes 44,000 million dollars.

The pandemic burned government papers, which planned to present an offer to creditors under international jurisdiction by March 31.

"This local deferral of payments gives a signal to bondholders under foreign law that they cannot (or want) to pay," Loser analyzed. Although "it does not seem that they want a confrontation in that field."

"The bondholders abroad are scared because it is not only Argentina, and perhaps they prefer to be flexible and not enter into a conflict that is later imitated by others," he added.

 Marina Dal Poggetto, economist at the EcoGo consulting firm, considered that there are different points of view.

"On the one hand, it is a local default, in principle without consequences, and on the other hand, it releases reserves to comply with the foreign law bonds," whose maturities are equivalent to some 3.5 billion dollars this year, he told AFP.

Daniel Marx, former Secretary of Finance, agreed that the decision can be interpreted "as a signal to external creditors to achieve flexibility in their positions."

"It could also be seen as a consideration to external creditors who from the beginning raised the advisability of treating emissions between jurisdictions differently, to the detriment of local law," he added.