5 Oct 2012

Argentine naval ship seized in Ghana

9:50 am on 5 October 2012

An Argentine naval ship has been seized in Ghana at the request of investors who lost money when Argentina defaulted on its loans in 2001.

The Libertad, a training ship on a tour of Africa, was prevented from leaving Ghana by court order on Wednesday.

Argentina's foreign ministry condemned the seizure as "a stunt" pulled by "vulture funds" which contravenes the Geneva Convention.

The BBC reports the ship was detained at the request of NML Capital, a subsidiary of US hedge fund Elliot Capital Management, one of Argentina's former creditors.

Argentina defaulted on more than $US100 billion of debt in 2001 and 2002.

Most of the loans were restructured in 2005 and 2010, giving creditors around 30% of their money back.

However, the BBC reports some creditors including Elliot chose to hold out, pursuing the Argentine government through the courts in order to recover the full amount.