Ahoy Argentina: Crew of boat seized by creditors in Ghana arrives home

The seizure of an Argentine boat off the coast of Ghana highlights the battle that continues between the southern cone nation and its creditors a decade after it defaulted on a $100 billion debt.

One would have expected crew members of the Libertad, an Argentine ship impounded in Ghana for the past three weeks, to be delighted to return home following its government-ordered evacuation.

But after his arrival in Buenos Aires aboard a charter plane with 278 colleagues, Luis Suárez was anything but.

“The worst thing you can ask a sailor to do is abandon ship,” he fumed Thursday, criticizing President Cristina Fernández de Kirchner.

The 320-foot long Libertad was seized in the Ghanaian port of Tema after NML Capital Ltd., a subsidiary of billionaire Paul Singer’s New York-based Elliott Capital Management, filed an injunction. 

The standoff underscores the battles that continue a decade after Argentina defaulted on $100 billion of debt and gave bondholders no option but to receive hugely reduced payouts.

The vessel is just one of 28 assets that have been seized from Argentina as “vulture funds” like NML pursue full payment.

Such funds – frequently berated by President Kirchner – buy up sovereign debt when governments are in chaos, and can make a lot of money off of it. In fact, some have done quite well.

But not NML, which has received nothing so far. It wants at least $20 million of the $300 million it says it is owed by Argentina before releasing the frigate.

But Kirchner won’t negotiate. Her administration takes huge pride in its “politics of debt reduction” employed since 2003.

In 2002, total public debt was 160 percent of Gross Domestic Product. Today the figure stands at around 40 percent.

That reduction, though, was achieved on Argentina’s terms. The majority of creditors settled for just 30 cents on the dollar after bond swaps in 2005 and 2010.

'What belongs to Argentina'

By refusing to yield to NML, however, the ever-combative Kirchner has incurred the wrath of Libertad’s crew.

“They can have the frigate, but they’ll never take away our dignity,” she said Monday. And so the ship, aboard which remains a skeleton staff of 45, looks set to stay in Ghana. The sailors have subsequently accused Kirchner of failing to stick up for Argentine sovereignty.

“Just as we were made to come back, I hope she has the guts to do the same with the boat,” Mr. Suárez said. “What she said shows she doesn’t care about what belongs to Argentina,” added another disillusioned crew member.

Such criticism is a kick in the teeth for a president who oozes nationalist rhetoric and follows up with policy, like the nationalization of YPF, an oil firm, in April.

“YPF’s ours; it’s Argentine,” read badges worn by senators in Congress. Similarly, Kirchner insists that the Falkland Islands, a British-controlled archipelago 300 miles off the coast of the South American nation, are also “Argentine.”

With Argentina’s Foreign Minister Héctor Timerman receiving little help from the United Nations, Kirchner is left with a difficult task: Appease the Libertad’s disgruntled crew by bringing the ship home, while refusing to give in to the “pirates of the 21st Century,” as Mr. Timerman refers to the creditors that continue to haunt Argentina.