El Salvador: $350 million to Cover Fiscal Deficit

El Salvador's Congress approved an IDB loan of $350 million to finance the government budget deficit at a 3.25% rate.

Monday, June 4, 2018

The president of the Legislative Assembly, Norman Quijano, stated that " ..." with the conditions offered by the IDB we will have an interest rate estimated at 3.25%, with the bonds we had an average rate of 7 and 8%, the reduction of interests will mean a saving of tens of millions of dollars for the country.' "

From a statement issued by the Legislature:

In order to complete the financing demanded by the current General Budget of the Nation, the Legislative Assembly has authorized the Executive Organ in the Treasury branch, to sign a loan agreement with the Inter-American Development Bank (IDB) for an amount of $350 million, called "Fiscal Strengthening Program for Inclusive Growth".

The initiative, which was unanimously authorized by all the parliamentary groups, does not represent a new debt, but the substitution of authorized securities in January 2018, which will allow for better credit conditions to be obtained in terms of repayment terms and a reduction in interest rates, in a responsible and transparent way.

Read full statement (in Spanish).

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