The Central Bank will issue importers bonds to pay their debts with providers, an amount that ballooned to over US$30 billion throughout Alberto Fernández’s administration. The measure is set to begin on December 27.

The instrument, called Bonds for the Rebuilding of a Free Argentina (Bopreal, by its Spanish acronym), will be subscribed to in pesos and paid for in U.S. dollars. A Central Bank resolution issued on Thursday also allowed companies to use them to pay for taxes.

During the last months of Fernández’s administration, the Central Bank failed to provide companies with U.S. dollars at the official rate. In order to not halt economic activity, the government allowed them to purchase goods and services based on credit through a system known as SIRA, which was enforced during Sergio Massa’s tenure in the Economy Ministry.

The BOPREAL will be used for transactions in which importers have already received what they petitioned from abroad but failed to pay due to those restrictions in the currency exchange market.

According to a press release by the Central Bank, the BOPREAL is “an orderly solution to solve the crisis generated by the short-term accumulation of importers’ trade debts at levels that are unmanageable with the available stock of reserves.” Net international reserves are calculated at negative US$11 billion. The communiqué added that the BOPREAL will act as a “bridge” to the accumulation of international reserves the government expects to take place in the next few years.

The first series of the BOPREAL, scheduled to be issued next week, will have a 5% interest rate and will mature on October 27, 2027. The second and third series, with a 0% and 3% interest rate, are set to be paid on June 30, 2025, and May 31, 2026, respectively.

The bonds will have a US$3.5 billion cap for their use in tax payments.

While some critics see the move as a way of nationalizing private debt at the official dollar rate — noting that some of that debt is with the importers’ parent companies —, others deem the BOPREAL as the beginning of a dollarization process, at least for the Central Bank’s portfolio.

“At the end of the day, let’s see the balance sheet of the BCRA,” Fernando Morra, macroeconomics director of the Suramericana Visión consulting firm, told the Herald. “We now have the replacement of a domestic currency debt, the LELIQ [28-day interest-bearing liabilities], for debt in foreign currency, the BOPREAL.”