The Sanchez Ceren administration had intended to use the proceeds to refinance debt, pay pensions of officials and allocate funds to the Ministry of Education, according to the explanation given by the authorities at the Ministry of Finance.

From a statement issued by the Constitutional Chamber:

The Court has declared a decree of nine hundred million dollars as unconstitutional for defrauding the Constitution and by means of a vote by deputies in a judgement issued this day, the Chamber declared the legislative decree unconstitutional by which the Legislature authorized the Executive Branch in the Field of Finance, to issue credit securities of up to the amount of $900 million, because it contravenes Article 131 ordinal 4 and 148 paragraph 2 of the Constitution; the aforementioned, not having justified the request made by acting deputies and because the decree was approved by people who have not been elected by the people. 

More on this topic

El Salvador: Concerns Over State's Ability to Pay

June 2016

The government looks like it will be unable to cope with its obligations in the second half of the year, because "there is no money to make it to the end of the year."

Figures from the Salvadoran Foundation for Economic Development (Fusades) indicate that the current balance of government debt (Treasury bills) now exceeds $900 million, and to meet its obligations in the second half of the year $500 million more is needed, which will have also have to be borrowed.

IMF Details Problems in El Salvador

May 2016

The IMF has indicated political polarization, high crime and outward migration, rising unit labor costs and high logistics costs, barriers to entry and expansion of business, fiscal uncertainty, and limited human capital.

From a statement issued by the IMF:

The IMF staff team visited San Salvador during April 25—May 6 for the 2016 Article IV consultation and held fruitful discussions with the Salvadoran authorities, parliamentarians, business community, academics, and social partners.

Costa Rica: Another Chapter in the Fiscal Debacle

February 2016

Central government, state unions, managers of public enterprises, deputies, supreme judges, all are being held in the deadly embrace of privileges while they drag Costa Rica over a cliff.

EDITORIAL

As long as the compensation system that excessively rewards state employees, regardless of their actual performance, is maintained, and the tax system is not reformed, fiscal problems will get worse.

Guatemala at the Gates of the Fiscal Cliff

October 2015

International fuding sources may be at risk if the State does not pay the service of the external debt.

Finance officials say they will not have the necessary funds to pay interest on the debt corresponding to November and December, about $142 million. The Deputy Finance Minister, Edwin Martinez, said "...