Argentina's economy could grow up to 7 percent in 2010 as the worst of the global financial crisis eases, Economy Minister Amado Boudou was quoted as saying in a local paper on Saturday.

When asked by the daily La Nacion if the country could grow up to 7 percent next year Boudou said: Yes, we are not afraid of reaching the highest level possible.

Critics say the Argentine government is usually too optimistic with its economic expectations.

Private experts forecast the economy will contract in 2009, though the government says the economy will grow slightly.

Boudou also said the government could allow retail holdout creditors not to subscribe to fresh capital in a swap of defaulted debt that aims to allow the South American country to return to the international debt markets.

Argentina plans to launch an offer next month to swap some $20 billion in defaulted debt that is still in the hands of holdout investors who did not accept a controversial debt restructuring in 2005. A deal with those investors is essential for Argentina to be able to issue an international bond.

Earlier this month Argentina filed a shelf offering with the U.S. Securities and Exchange Commission for the sale of up to $15 billion in debt instruments in the United States.

Boudou reiterated that a 60 percent participation in the debt swap would be very good.

Argentina plans to swap defaulted sovereign bonds for new issues.

Argentina has been shunned from the international capital markets for eight years since a default of nearly $100 billion. The country is now trying to regain investor confidence as it faces tight financing next year.

Boudou has wooed international investors in recent months with a series of market-friendly gestures.

(Reporting by Nicolas Misculin; Writing by by Alonso Soto; Editing by Eric Beech)