Support our non-partisan non-profit newsroom 💜 Donate now

Argentina nationalizing pension system

Dan Grech Oct 22, 2008
HTML EMBED:
COPY

Argentina nationalizing pension system

Dan Grech Oct 22, 2008
HTML EMBED:
COPY

TEXT OF STORY

Renita Jablonski: Onto another example of nervousness. Argentina’s leftist government announced late yesterday it was nationalizing the country’s private pension system. Argentine bond yields skyrocketed, while the local stock market plummeted 11 percent to its lowest level in four years. From the Americas Desk at WLRN, Marketplace’s Dan Grech reports.


Dan Grech: Argentina’s private pensions are somewhat like 401K accounts in the U.S. Three million Argentines pay $5 billion into the system each year. Argentina says it’s taking over the pension system to protect workers from losses due to declines in global markets.

Business journalist Julieta Tarres is with the Argentine paper Cronica. She says really, the Argentine government is strapped for cash and faces mounting debts.

Julieta Tarres (voice of interpreter): Exports are declining and commodity prices are falling, and the government won’t collect the taxes they did in years past. They don’t have any other place to find money.

Back in 2001, Argentina defaulted on $95 billion in bonds, the largest sovereign-debt default ever. Since then, no one in the international credit markets has been willing to lend to Argentina. The pension takeover is expected to be approved in the coming days by Argentina’s Congress.

I’m Dan Grech for Marketplace.

There’s a lot happening in the world.  Through it all, Marketplace is here for you. 

You rely on Marketplace to break down the world’s events and tell you how it affects you in a fact-based, approachable way. We rely on your financial support to keep making that possible. 

Your donation today powers the independent journalism that you rely on. For just $5/month, you can help sustain Marketplace so we can keep reporting on the things that matter to you.