According to a report by just-auto.com, the money will be sourced from pension funds controlled by the National Social Security Administration and will be especially aimed at supporting General Motors produce a new car in the country.
"We are signing a loan contract and are not going as far as buying shares as US President Barack Obama did," president Cristina Kirchner said in a statement.
As we're sure you know, Argentina is not the first country that gives money to the American manufacturer to continue operations and avoid job cuts as much as possible. In a statement issued last week, Fritz Henderson, GM's CEO, underlined the important of government funds.
"One of the things that we said was necessary in order for us to even have any chance of bankruptcy was we needed to raise DIP financing, be able to run the business through a bankruptcy. Last fall that wasn't available," Henderson said, pointing to the company's financial situation in the United States.
"In fact, the conclusion that we reached in terms of using the 363 tool with the U.S. Treasury not only providing the DIP financing for us to go through a bankruptcy process, but also provide the excess financing just simply wasn't available last fall, and the truth is that the work done by the task force, the work done with the task force in terms of how might we actually effect the change in the capital structure, it just as far as I was involved in it. Really wasn't on the table nor in the cards at that point. It is today. So that's why it's feasible today and really wouldn't have been feasible last fall."
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