A bill is being discussed in Congress to facilitate financing for producers and to support them in certifying the quality of their plantations.
Because of the complex scenario faced by African palm producers because of low international prices, the Hernandez administration presented to Congress the bill "Law for the Strengthening of the Productive Sector of Oil Palm."
The governments of Costa Rica and Nicaragua will face greater challenges in obtaining financing in external markets, because of the lowering of their risk ratings by international agencies.
Arguing that Costa Rica reflects consistently large fiscal deficits, short-term financing needs because of a strong repayment schedule and budget financing constraints, Fitch Ratings reported on January 15 that the country's long-term foreign currency issuer default rating was downgraded from BB to B+.
In Costa Rica a law proposal pretends to reduce by 50% the bank fees on loans for businesses and SMEs, as well as credits for social housing and lower class.
The law project, which was presented to the Congress by the representative, Yorleny Leon, aims to reduce fees in the formalization of bank loans, which currently range between 8% and 10% of total credit.
The interest rate rise in the US and the perceived risk of the Salvadoran economy have taken their toll on foreign debt bonds, whose yields have risen by about 2% in recent weeks.
This increase in yield of debt securities traded on the international market will be reflected in the forthcoming issues made by the government, which, according to economic analyst Mauricio Choussy, "...
The tender documents for the construction of Line 2 of the Metro in Panama requests the companies to include project financing as an option.
Once bids have been submitted by the companies concerned, the Panama Metro Secretariat and the Ministry of Finance will evaluate the proposed financing conditions in each offer, looking for "the best possible interest rate".
Moody's has removed the country's rating of "investment grade", citing the increase in public spending and political inability to implement fiscal reform.
From a statement by Moody's:
New York, September 16, 2014 -- Moody's Investors Service has today downgraded Costa Rica's government bond rating to Ba1 from Baa3. Moody's has also changed the outlook to stable from negative.
The country pays 4% more than the United States for its debt bonds in the international market.
The cost to be borne by El Salvador for resources from abroad is widening due to the country's high level of indebtedness, the lack of investment grade and the complex economic and political situation.
According to Bloomberg, "Comparing the interest paid on Salvadorans bonds, maturing in 2035, with U.S.
According to Standard & Poor's, the increase in transactions of covered bonds is strengthening financial markets in the region.
From an article by Standard & Poor's:
"Central America: New Transactions Could Bolster Performance"
"Panama's dormant yet sophisticated residential mortgage market witnessed some activity in 2013. After more than two years since the last placement, a new RMBS transaction was placed in the local market in 2013 for US$45 million, with the underlying collateral comprising residential mortgage loans in El Salvador. Historically, most securitizations have been locally placed, with just a few cross-border transactions.
The portfolio of loans granted through credit cards grew by 18% between November 2012 and November 2013.
Up until November 2013, the balance of active cards reached a total of $1.207 billion, while in the same period of 2012 it was $1.021 billion, representing an increase of 18% , according to statistics from the Superintendency of Banks of Panama (SBP).
$120 million for "financing costs" will be added to the charges resulting from contracts from the tender for the expansion of the Inter-American Highway in Panama.
"... The project could end up costing $1.092 billion, because in the resolutions for the award of contracts, signed by the Minister of Public Works, Jaime Ford, additional amounts have been included for "financing costs" and "costs associated with the Ministry of Public Works (MOP) ", reported Prensa.com.
President Ricardo Martinelli has said that China will finance the construction of a monorail line in Panama City.
The work is for the third phase of the Metro and is located in the western sector of the province of Panama.
According to Martinelli, funding will be long term and with low interest rates.
"This project will form the completion of the third part of the Panama Metro, the first is already under construction, from the Andes to Albrook. The second will be the part in East Panama", reported laestrella.com.pa.
The difference between nominal rates paid for loans in local currency and inflation is reaching levels not seen for the past 9 years.
Investors are happy with the situation, which means that their securities in colones are giving them good returns, but for entrepreneurs who need credit for their business or to develop new initiatives, concern is growing.
With this transaction the Panama Canal Authority will benefit from stable and cheaper interest rates.
Morgan Stanley Capital Services Inc assisted the Authority in ‘swapping’ $800 million from floating interest rates to fixed ones, for the next 20 years.
“With this hedging operation, the Canal Authority will be protected from potential changes in interest rates”, explained José Barrios, sub manager of the Panama Canal.
When changing the financing scheme to sovereign debt, BCIE suggested Guatemala to do its bidding process again.
The original public bid, won by its sole participant Solel Boneh FTN, stated that the winning company was responsible for obtaining financing for the project, which in this case was provided by the Central American Integration Bank (BCIE) to the company.