It may be expensive, but Hugo Chávez is the only one to finance the Argentine Treasury. He does so following the Kirchner couple's wishes as, for instance, the IMF would lend Argentina at a rate lower than 5 per cent. Chávez, due to his investing and carefree attitude (he does not question Argentine fiscal solvency), will earn a tempting 16-per cent interest.
El contenido al que quiere acceder es exclusivo para suscriptores.
No serious country pays currently more than 8 per cent for its bonds. Paradoxically, the average bond rate that shocked Néstor Kirchner when he took office, and which he refused to pay -considering that those who bet on such a speculative profit, «those crooks», knew the loss risk they were facing-, is almost the same that today captivates the Venezuelan head of state.
Hugo Chávez announced yesterday that Venezuela «purchased 1 billion dollars in Argentine bonds», thus consolidating his country as the main and only country financing the Argentine government. He described the society of both countries as the «Golden Couple», in relation to business deals they would do together.
Venezuelan government's purchase of Argentine bonds was confirmed last night by a source from the Ministry of Economy, who explained that the operation involved BODEN 2015 issued in dollars and with a fixed coupon rate of 7 per cent. However, the final rate will be 16 per cent in dollars. In May, the implicit rate was 12.9 per cent.
Chávez made the announcement in a meeting organized by the Argentine Foreign Office with 200 local businessmen, mainly small and medium producers. During the meeting, Chávez not only talked further about his Bolivarian theories and his launch pad of socialism in the XXI Century, but also indulged himself in teaching modern management to the audience.
About his purchase of bonds, he assured he feels «absolutely confident» about financial bonds issued by Argentina, as they are «gold, and not garbage as those issued by the US». «A few days ago, Venezuela bought 1 billion dollars in Argentine bonds, which provide high yields and enjoy great prestige».
He also presented his new international financing project «to guarantee continental development» - the creation of a binational investment fund for industrial projects. According to the Venezuelan head of state, this will be «a powerful engine that will be started before the end of the year, as part of the new structural phase in the relation between Argentina and Venezuela». Chávez believes that this fund will guarantee the creation of over 46 companies in both countries, which will be supplied with consumables and products only from Venezuela and Argentina's markets, as a way of promoting the projects.
Besides, in the meeting with the 200 local businessmen, Chávez government signed agreements with Argentine National Institute of Industrial Technology (INTI, for its acronym in Spanish) for the provision of technical services and training to Venezuelan organizations, while Venezuelan Agrarian Corporation signed a contract for the supply of agricultural machinery.
The meeting was attended by Secretary of Trade and International Economic Relations Alfredo Chiaradía; Under-Secretary for Latin American Affairs Agustín Colombo Sierra, and Argentine ambassador to Venezuela Alicia Castro. The Venezuelan delegation was made up of Foreign Minister Nicolás Maduro; Secretary of Industry William Contreras, and ambassador to Argentina Arévalo Méndez Romero.
By the end of the meeting, Chávez offered the possibility of selling Venezuelan asphalt to pave Argentine dirt roads.
