It has been revealed that Argentina's $20 billion debt swap will shrink the nation's borrowing costs by one third to about 2% points more than that of its neighboring country Brazil in just a year's time. This has been revealed by the Economic Minister, Amando Boudou.

Boudou evinced in an April 14 interview, "We are convinced that we have to mark a lower interest rate than we have now and that is the most important goal that we seek with this swap".

Boudou revealed a proposal yesterday to exchange defaulted bonds culled out of 2005 reorganization for securities due in 2033, which are valued at 33.7 cents on the dollar. They will also be paying past outstanding interest with bonds due in 2017.

However, this offer does not include past payments on warrants linked to economic growth. According to Boudou, this proposal will also help Argentina reclaim reliability from investors nine years after the Government defaulted on $95 billion of debt.

According JPMorgan Chase & Co., Argentine dollar bonds produce 5.92 % points in excess of U. S. Treasuries, in contrast with a spread of 1.67% points for Brazilian debt.