The provinces are indebted to individuals, guaranteed by the Federal Government, which exceeds $ 35,000 million following the financial restructuring carried out by the central power after the economic crisis of 2001. According to a report from the General Audit Office (AGN, for its acronym in Spanish) on Debt Swaps between the Nation and the Provinces, territories that need the most and show less ability to comply are Buenos Aires, Neuquén, and Rio Negro.
Buenos Aires accumulated a debt of 2,338 million pesos and its cancellation ability is 32% of the deficit in its balance of payments, the difference between revenues and expenditures, as presented in sixty of the last hundred months. Meanwhile, Rio Negro owes more than $221 million, with an ability to pay of 26.8% and a phase shift between the money it collects and spends that is recorded in 55 of the last hundred months. And Neuquén owes almost $185 million with a power cancellation of 21.45% and has, like Buenos Aires, a negative balance between revenues and expenditures in sixty of the last hundred months.
The total figure comes from the restructuring of provincial trust funds, totaling $ 28,000 million and that are canceled with BOGAR bonds. This debt is "contingent" because the particularity of these titles is that if the provinces cannot cancel its obligations, the Federal Government must meet the payments. In addition, the monetary union after issuance of the almost currencies like the Patacones in Buenos Aires, Lecor in Córdoba, and Lecop in several other provinces, the districts owe the Government $7,150 million to be canceled according to the maturity of BODEN 2011 and 2013, issued to remedy the situation.
The AGN’s report details the restructuring of the provincial finances between 2002 and 2004. The debts of the provinces increased significantly since 2001, when the Federal Government raised the floor of the co-participation but could not fulfill these obligations by the recession and the drop in revenues. Thus, the provinces began issuing their own currencies and generated more debt.