Argentina on Tuesday formalized a new offer to creditors by presenting its proposal to the US Securities and Exchange Commission as President Alberto Fernandez's government looks to restructure a $66 billion debt.

Creditors have until an August 4 deadline set by the government to agree to the restructure plan -- an exchange offer to bondholders under foreign law.

The new offer is worth 53.5 cents on the dollar, a significant improvement on Argentina's original starting position of 39 cents, which was rejected.

It also reduces the grace period from three years to one year, with payments beginning in September 2021.

Argentina's President Alberto Fernandez is seeking to restructure his country's $66 billion debt with a new offer to the US Securities and Exchange Commission
Argentina's President Alberto Fernandez is seeking to restructure his country's $66 billion debt with a new offer to the US Securities and Exchange Commission Argentinian Presidency / ESTEBAN COLLAZO

Fernandez said that Argentina "has maintained a position open to dialogue and considering various proposals" put forward by creditors.

The center-left leader stressed that the South American country had "evaluated and considered" creditors' points of view and "deeply analyzed their suggestions, within the confines of restoring debt sustainability."

Crisis-wracked Argentina -- one of the world leaders in food exports -- has been in recession since 2018 and two months ago defaulted for the ninth time after failing to pay $500 million of interest on its bond debt.

It has been further rocked by the coronavirus pandemic and the International Monetary Fund predicts its economy will shrink by almost 10 percent this year.

Latin America's third largest economy actually owes $324 billion in total, a sum that represents around 90 percent of its GDP.

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