The Central American Bank for Economic Integration approved a $24 million extension of an existing line of credit, funds that will be invested in the implementation of sustainable production models and forest management and reforestation.
These funds will be used to increase financing for the "Bio-CLIMA Project: Integrated Climate Action to Reduce Deforestation and Strengthen Resilience in the Bosawas and Rio San Juan Biosphere Reserves" on Nicaragua's Caribbean Coast.
CABEI signed a memorandum of understanding with other Central American organizations to strengthen the development of the regional public debt market.
The agreement was signed by the Central American Bank for Economic Integration (CABEI), the Executive Secretariat of the Council of Finance Ministers of Central America, Panama and the Dominican Republic (SECOSEFIN), the Executive Secretariat of the Central American Monetary Council (SECMA) and the Association of Central American Stock Exchanges (BOLCEN).
In this regional context of economic crisis, falling fiscal revenues and increasing public debt, Costa Rica's debt level is expected to rise to 75% of GDP by 2021, and in the case of El Salvador, the indicator could exceed 85%.
The outbreak of covid-19 in Central America forced the government to declare severe household quarantines and to restrict several economic activities, restrictions that in some cases are still in place after five months of health and economic crisis.
Arguing that economic strength has weakened as a result of social tensions and is likely to leave a lasting negative impact, the rating agency reduced the country's credit risk rating from B2 to B3.
"The risk of reduced access to official external credit is creating financing challenges and restricting the authorities' ability to support economic activity," the agency's report explains.
Standard & Poor's has given a B+ rating to the $1.5 billion debt issue that Costa Rica expects to place in the international market in November.
"Global Ratings today assigned a "B+" rating to the prospective reopening of Costa Rica's notes which have a 7.158% rate maturing in 2045 and a "B+" rating in its planned issuance of notes maturing in 2031, the latter issue still does not have a defined trading rate," the rating agency said on November 8.
Although the goal for this year was to issue $100 million in debt bonds, during the first quarter the Nicaraguan government only awarded $1.1 million, doubting the level of investor confidence.
According to the "Public Debt Report, First Quarter 2019", prepared by the Central Bank of Nicaragua, from January to March regarding Investment Securities in dollars, 1.03 million was issued at an average rate of 5.31% and an average term of 7 months.
At the end of June 2019, Nicaragua's public external debt reached $6.057 million, an increase of $107 million over December 2018.
From the Central Bank of Nicaragua statement:
According to official statistics, the balance of public external debt up to June 30, 2019 was of 6,057.0 million dollars, which represented a 46.0-million-dollar increase regarding the balance registered in the previous month (US$6,011.0 million).
The latest risk ratings for the issuance of long-term debt of Central American economies identify Panama as the most attractive country to invest in.
On March 8, Moody's decided to raise its long-term issuer rating in foreign currency from Baa2 to Baa1, arguing that the outlook remains more favorable in the medium term.
At the end of the first month of 2019, public external debt reached $5.966 million, 7% more than that reported in January 2017, a rise explained by loans granted by multilateral agencies.
The report of the Central Bank of Nicaragua (BCN) "... According to these statistics, public external debt totaled US$5,966.6 million, representing a net increase of US$17.0 million over the previous month.
At the end of last year, Nicaragua's public external debt totaled $5.940 million, 7% more than at the end of 2017.
The Central Bank of Nicaragua reported that "... According to statistics, public external debt totaled $5,940.1 million up to December 2018, representing a $58.3 million net increase over the previous month.
Of this total, US$4,140.7 million are debt with multilateral creditors (69.7%), US$1,748.9 million with bilateral creditors (29.4%) and US$50.5 million with private creditors (0.9%).
On November 14th, Banpro Grupo Promerica issued $200 million in bonds on the international market for a six-year term under the 144A format.
The bank announced that the issuance was made by Promerica Financial Corporation (PFC), its main shareholder, and that the issue was structured by Bank of America Merrill Lynch and Credit Suisse.
Ramiro Ortiz Mayorga, chairman of the board and CEO of Promerica, explained to Elnuevodiario.com.ni that "...
In Nicaragua, the license of CrediFactor S.A. to offer securities to the public was revoked due to the difficulties the company is facing in paying for the securities.
The executive president of CrediFactor, Mauricio Pierson Stadthagen explained to Elnuevodiario.com.ni that "... The country's situation decelerated the rate of recovery of the portfolio they had been recording, which was funded with the issuance of bonds in which individuals invested. The factoring company did not take deposits from the public."
The Nicaraguan government authorized the Finance and Public Credit Ministry to issue $279.7 million in debt securities to cover the budget deficit.
The presidential agreement details that "In order to comply with the provisions of Article 6 of Law 978; Amendment Law to Law 966, Annual Law of the General Budget of the Republic 2018, increasing internal financing through greater issuance of bonds of the Republic of Nicaragua for a total of C$9, 035,600,000."
At the end of the second quarter of the year, the country reported that the total external debt amounted to $11.728 billion, an amount that exceeds by 1.9% what was recorded at the end of 2017.
Nicaragua's total external debt totaled 11.728 billion dollars, of which 6.0832 billion corresponds to the private sector and 5.6448 billion to the public sector.Total external debt increased by 175.7 million dollars (1.5%), compared to the first quarter of 2018, reported the Central Bank of Nicaragua.