In the excerpt from the last paragraph – ... perceptions of
Argentina as a financial rogue state – the expression financial
rogue state implies a country which is
Argentina defaults – Eighth time unlucky
Cristina Fernández argues that her country's latest default is
different. She is missing the point.
Aug 2nd 2014
ARGENTINA'S first bond, issued in 1824, was supposed to
have had a lifespan of 46 years. Less than four years later, the
government defaulted. Resolving the ensuing stand-off with
creditors took 29 years. Since then seven more defaults have
followed, the most recent this week, when Argentina failed to
make a payment on bonds issued as partial compensation to
victims of the previous default, in 2001.
Most investors think they can see a pattern in all this, but
Argentina’s president, Cristina Fernández de Kirchner, insists
the latest default is not like the others. Her government, she
points out, had transferred the full $539m it owed to the banks
that administer the bonds. It is America’s courts (the bonds
were issued under American law) that blocked the payment,
at the behest of the tiny minority of owners of bonds from
2001 who did not accept the restructuring Argentina offered
them in 2005 and again in 2010. These “hold-outs”, balking at
the 65% haircut the restructuring entailed, not only persuaded
a judge that they should be paid in full but also got him to
freeze payments on the restructured bonds until Argentina
coughs up.
Argentina claims that paying the hold-outs was impossible.
It is not just that they are “vultures" as Argentine officials often
put it, who bought the bonds for cents on the dollar after the
previous default and are now holding those who accepted
the restructuring (accounting for 93% of the debt) to ransom.
The main problem is that a clause in the restructured bonds
prohibits Argentina from offering the hold-outs better terms
without paying everyone else the same. Since it cannot afford
to do that, it says it had no choice but to default.
Yet it is not certain that the clause requiring equal treatment
of all bondholders would have applied, given that Argentina
would not have been paying the hold-outs voluntarily, but on
the courts' orders. Moreover, some owners of the restructured
bonds had agreed to waive their rights; had Argentina made a
concerted effort to persuade the remainder to do the same, it
might have succeeded. Lawyers and bankers have suggested
various ways around the clause in question, which expires at
the end of the year. But Argentina's government was slow to
consider these options or negotiate with the hold-outs, hiding
instead behind indignant nationalism.
Ms Fernández is right that the consequences of America's
court rulings have been perverse, unleashing a big financial
dispute in an attempt to solve a relatively small one. But hers
is not the first government to be hit with an awkward verdict.
Instead of railing against it, she should have tried to minimise
the harm it did. Defaulting has helped no one: none of the
bondholders will now be paid, Argentina looks like a pariah
again, and its economy will remain starved of loans and
investment.
Happily, much of the damage can still be undone. It is not
too late to strike a deal with the hold-outs or back an ostensibly
private effort to buy out their claims. A quick fix would make
it easier for Argentina to borrow again internationally. That, in
turn, would speed development of big oil and gas deposits,
the income from which could help ease its money troubles.
More important, it would help to change perceptions of
Argentina as a financial rogue state. Over the past year or
so Ms Fernández seems to have been trying to rehabilitate
Argentina's image and resuscitate its faltering economy. She
settled financial disputes with government creditors and with
Repsol, a Spanish oil firm whose Argentine assets she had
expropriated in 2012. This week's events have overshadowed
all that. For its own sake, and everyone else's, Argentina
should hold its nose and do a deal with the hold-outs.
(http://www.economist.com/news/leaders/21610263. Adapted)
Cristina Fernández argues that her country's latest default is different. She is missing the point.
Aug 2nd 2014
ARGENTINA'S first bond, issued in 1824, was supposed to have had a lifespan of 46 years. Less than four years later, the government defaulted. Resolving the ensuing stand-off with creditors took 29 years. Since then seven more defaults have followed, the most recent this week, when Argentina failed to make a payment on bonds issued as partial compensation to victims of the previous default, in 2001.
Most investors think they can see a pattern in all this, but Argentina’s president, Cristina Fernández de Kirchner, insists the latest default is not like the others. Her government, she points out, had transferred the full $539m it owed to the banks that administer the bonds. It is America’s courts (the bonds were issued under American law) that blocked the payment, at the behest of the tiny minority of owners of bonds from 2001 who did not accept the restructuring Argentina offered them in 2005 and again in 2010. These “hold-outs”, balking at the 65% haircut the restructuring entailed, not only persuaded a judge that they should be paid in full but also got him to freeze payments on the restructured bonds until Argentina coughs up.
Argentina claims that paying the hold-outs was impossible. It is not just that they are “vultures" as Argentine officials often put it, who bought the bonds for cents on the dollar after the previous default and are now holding those who accepted the restructuring (accounting for 93% of the debt) to ransom. The main problem is that a clause in the restructured bonds prohibits Argentina from offering the hold-outs better terms without paying everyone else the same. Since it cannot afford to do that, it says it had no choice but to default.
Yet it is not certain that the clause requiring equal treatment of all bondholders would have applied, given that Argentina would not have been paying the hold-outs voluntarily, but on the courts' orders. Moreover, some owners of the restructured bonds had agreed to waive their rights; had Argentina made a concerted effort to persuade the remainder to do the same, it might have succeeded. Lawyers and bankers have suggested various ways around the clause in question, which expires at the end of the year. But Argentina's government was slow to consider these options or negotiate with the hold-outs, hiding instead behind indignant nationalism.
Ms Fernández is right that the consequences of America's court rulings have been perverse, unleashing a big financial dispute in an attempt to solve a relatively small one. But hers is not the first government to be hit with an awkward verdict. Instead of railing against it, she should have tried to minimise the harm it did. Defaulting has helped no one: none of the bondholders will now be paid, Argentina looks like a pariah again, and its economy will remain starved of loans and investment.
Happily, much of the damage can still be undone. It is not too late to strike a deal with the hold-outs or back an ostensibly private effort to buy out their claims. A quick fix would make it easier for Argentina to borrow again internationally. That, in turn, would speed development of big oil and gas deposits, the income from which could help ease its money troubles.
More important, it would help to change perceptions of Argentina as a financial rogue state. Over the past year or so Ms Fernández seems to have been trying to rehabilitate Argentina's image and resuscitate its faltering economy. She settled financial disputes with government creditors and with Repsol, a Spanish oil firm whose Argentine assets she had expropriated in 2012. This week's events have overshadowed all that. For its own sake, and everyone else's, Argentina should hold its nose and do a deal with the hold-outs.
(http://www.economist.com/news/leaders/21610263. Adapted)
Gabarito comentado
Tema central: A questão avalia interpretação de texto e vocabulário contextual, com foco na expressão “financial rogue state”. Compreender o significado preciso de termos extraídos de textos autênticos é uma das competências mais cobradas em provas de Vestibular e concursos públicos.
Conceito-chave: “Rogue state” define internacionalmente países vistos como imprevisíveis, perigosos ou desonestos em suas relações. No contexto financeiro, “financial rogue state” indica práticas desonestas, prejudiciais ou que buscam enganar outros players para benefício próprio.
Justificativa da alternativa correta (D): A alternativa D) trying to deceive others for its own profit (tentando enganar outros para benefício próprio) reflete precisamente o sentido da expressão. O texto contextualiza a Argentina como recorrente em default, tomando decisões que prejudicam credores e fogem a padrões financeiros éticos, o que vai de encontro ao conceito de “financial rogue state”. Segundo renomados manuais como Inglês para Concursos Públicos de Denilso de Lima, analisar o contexto imediato e o histórico do vocábulo ajuda a identificar o sentido preciso, mesmo diante de sinônimos próximos.
Análise das alternativas incorretas:
A) closed to dealings with other countries: Não implica necessariamente em comportamento desonesto, mas apenas auto-isolamento, o que não define totalmente “rogue state”.
B) always asking others to do what it wants: Reflete imposição de vontade, mas sem relação direta com condutas desonestas ou fraudulentas.
C) imposing its views on the international community: Nova menção à imposição, porém “rogue state” diz respeito a ações financeiramente antiéticas, não a disseminação de opiniões.
E) nationalizing assets from other countries: Apesar da prática ter ocorrido (como no caso Repsol), o termo “financial rogue state” é mais abrangente e não se restringe à nacionalização de ativos, mas à conduta reiterada de enganar terceiros.
Estratégia para prova: Atente-se a termos técnicos e contextualização do vocabulário: palavras como deceive, rogue ou default têm cargas semânticas específicas. Muitos erros em provas vêm do reconhecimento superficial do termo. Sempre busque o sentido central e não apenas traduções literais.
Conclusão:
A alternativa correta é D). Ela traz o conteúdo conceitual e contextual adequado para “financial rogue state”.
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