| Update: Argentina goes into default for the second time in 13 years as negotiations with holdout creditors concluded with no agreement being reached. Default will have heavy consequences for Argentina’s already struggling economy, and dire repercussions on human rights are to be expected. |
In a letter initiated by its member organisation in Argentina the Centro de Estudios Legales y Sociales (CELS) and released yesterday, FIDH and 100 other human rights organisations from around the world denounce the adverse human rights impacts resulting from the US Supreme Court’s decision to reject an appeal relating to Argentina’s sovereign debt.
The Supreme Court’s non consideration of this case validates a lower court’s decision forcing Argentina to repay holdout creditors also known as "vulture funds" which had acquired sovereign debt bonds after Argentina’s previous default but had not accepted the 2005 and 2010 restructuring agreements. Such decision could lead Argentina to default once again, and will negatively affect its capacity to respect, protect and fulfil all human rights.
Signing organisations warn that the conflict on sovereign debt between Argentina, the vulture funds and the United States’ judicial system must not be understood as an isolated case, but rather as the expression of a global problem that impacts the effective implementation of human rights.
This case shows the necessity to balance the interests of creditors and debtors in a way that ensures that States can respect their obligations to protect and fulfil human rights. As recognised by the United Nations, "any foreign debt strategy must be designed not to hamper the improvement of conditions guaranteeing the enjoyment of human rights and must be directed to ensuring that debtor States achieve an adequate level of growth to meet their social and economic needs and their development requirements, as well as fulfilment of their human rights obligations". The US Supreme Court failed to uphold this principle.
Read CELS’ article here.
Read the Joint Declaration on Argentina sovereign debt and human rights (English below)