Argentina's president Alberto Fernandez said Monday his government would abide by a recent Supreme Court ruling and give a larger proportion of state funds to the opposition-controlled city of Buenos Aires.
The announcement signaled a reversal from a decision last week that drew a backlash, when Fernandez said he was rejecting a ruling from the court that increased funding to the capital.
"Judicial rulings are binding even when they are deemed to be disadvantageous and unfair," Fernandez said on Twitter, clarifying that the funds will be paid in peso-denominated bonds.
In a ruling last Wednesday, the Supreme Court ruled that the capital city should return to receiving 2.95% of federal funds, which it received before the national government cut the percentage in 2020 to 1.4%.
The city, the richest and most populous in the country, is controlled by a conservative mayor and has been pushing for a large slice of funds, which Argentina law requires be distributed between the country's regions.
On Thursday, Fernandez sparked a legal crisis when he pledged to ignore the "incongruous and impossible-to-enforce" ruling, which he called politically motivated ahead of general elections next year and said would hurt the other provinces.
(Reporting by Nicolas Misculin; Editing by Chizu Nomiyama)
