Argentina's government said Tuesday that it reached its first agreement to settle outstanding bonds from a 2001 default, putting it on track to return to borrowing on global financial markets.

Finance Minister Alfonso Prat-Gay said 50,000 Italians holding $900 million in defaulted bonds agreed to collect the principal plus a “prudent” amount of interest equivalent to a third of what they were demanding.

This means that the payment will be less than the $2.7 billion that Italian creditors were seeking in a lawsuit in the International Centre for Settlement of Investment Disputes, a World Bank tribunal, Prat-Gay said in a televised press conference.

Task Force Argentina, a group representing the Italian creditors, said Argentina would pay $1.35 billion in cash to settle the $900 million in principal plus interest, according to a statement.

This is the first deal to settle the 7 percent of bonds held by creditors who refused to participate in 2005 and 2010 restructurings, when the country paid 30 cents on the dollar.

Creditors holding 93 percent of the debt took part, while the rest pursued legal channels to get paid back in full, plus past-due interest.

The deal is part of a wider effort by Argentina to return to borrowing on world markets, helping to access funds at lower interest rates and to encourage foreign investment.

A full settlement will improve the country’s creditworthiness, helping to drive down borrowing costs.

Argentina still owes another $9 billion or so on the defaulted bonds.

Mauricio Macri, who became Argentina’s president in December, wants to settle with the rest of these creditors “as fast as fair as possible,” according to Prat-Gay.

With some of the creditors, however, negotiations have been harder because they are demanding an amount of interest “that by any standard of justice is unacceptable,” Prat-Gay said.

Anadolu Agency