World Bank arbitration on hold after Argentina debt deal with Italian creditors

ROME Feb 4 Arbitration at the World Bank
between Argentina and Italian creditors will be put on hold for
four months to give the Argentine parliament time to ratify a
deal on defaulted debt, the head of a bondholder association
said on Friday.

Nicola Stock, the president of Task Force Argentina, said if
Argentina's Congress did not agree to the accord, which offers
some $1.35 billion in cash to the Italian creditors, then the
arbitration at the International Centre for Settlement of
Investment Disputes (ICSID) would resume.

"As part of the deal, we agreed to suspend the ICSID
arbitrage for four months to let Argentina ratify the accord,"
Stock told a news conference.

"I think that one of the reasons the Argentine government
decided to reach a deal with us was to avoid a ruling from
ICSID, which was due shortly," he added.

The deal, announced on Tuesday, represents a payment of 150
percent on the $900 million principal value of the debt which
Argentina defaulted on in 2002.

(Reporting by Stefano Bernabei; Editing by Crispian Balmer and
Steve Scherer)

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