Between today and February 14 the Ministry of Finance in Costa Rica will go to the local market with the goal of issuing $290 million, at a rate of 7% and maturing in 2019.
In its constant search for fresh resources to meet the interest payments on its growing debt as well as its current expenses, during the next few days the Ministry of Finance will return to the market to try to raise $290 million, through the issue of government debt bonds.
Last year, the Central Government's current expenditures amounted to $6.712 billion, 8.5% more than in 2016, while capital expenditures totaled $3.730 billion, or 6.4% of GDP.
From a statement issued by the Ministry of Finance:
As of December 2017, the total revenues of the Central Government (CG) were B /.
The government's financial deficit rose from 3.4% of GDP in September 2016 to 4% in the same month this year, explained by an increase in the financial cost of debt and an increase in capital expenditure.
From a statement issued by the Ministry of Finance:
At the end of September, the central government's revenue and expenditure figures reflect the need for comprehensive fiscal reform (via income and expenditure), which will make it possible to sustain the state's finances, as well as stability and continuity of social achievements which the country achieved throughout its history.
The fiscal deficit closed July 2017 at 2.9% of GDP, up from 2.4% of GDP in the previous month, due to an increase in the financial cost of servicing debt.
From a statement issued by the Ministry of Finance:
As of July 2017, revenues grew by 5.6% compared to July 2016, and expenses increased by 9.1% over the same period. 88% of the increase in spending is due to transfers, interest and investment in education and road infrastructure.
After recognizing the serious liquidity problems faced, the government has announced it will borrow another $1 billion for a hearty lunch that others will pay for tomorrow.
The $1 billion that the Central Bank of Costa Rica (BCCR) has been negotiating since May with the Latin American Reserve Fund (FLAR) to strengthen its reserves will arrive in October of this year, according to the BCCR authorities.
Tax revenues went from a rate of change of 7% in March 2016, to a rate of 8.5% in the same month of this year.
From a statement issued by the Ministry of Finance:
Authorities at the Treasury announced the performance of the central government's fiscal figures at the end of the first quarter of the year, which indicate how tax revenues continue to show good results, going from a rate of change of 7% in March 2016 to 8.5% in the same period this year.
The financial deficit accumulated up to August 2016 stands at 2.9% of GDP, slightly below the 3.6% recorded in the same period in 2015.
From a statement issued by the Ministry of Finance:
A reduction of ¢157,082 million in the financial deficit (revenues minus expenses), and a difference of seven percentage points between increased income and expenses, were the main fiscal figures of the Central Government recorded at the end of the second quarter of this year.
The accumulated financial deficit in July 2016 stood at 2.6% of GDP, slightly below the value at which it stood in the same month in 2015.
From a statement issued by the Ministry of Finance:
A reduction of ¢134,410 million in the financial deficit (revenues minus expenses), equivalent to more than half of GDP, and a difference of 7.3 percentage points between increased income and expenses, were the fiscal figures recorded for Central Government up to July this year.
The weight of interest from debts as a share of GDP went from 1.3% to 1.4% between June 2015 and December 2016.
From a statement issued by the Ministry of Finance:
A reduction of ¢121,358 million in the financial deficit (revenues minus expenses), was recorded in fiscal figures from the Central Government at the end of the first half of this year.
Arguing that the country's credit profile has overcome the political crisis in 2015, the agency has raised from negative to stable the outlook for sovereign debt notes, which still stand at Ba1.
From the press release by the IMF:
New York, June 30, 2016 -- Moody's Investors Service has today changed the outlook on Guatemala's ratings to stable from negative and affirmed the Ba1 government bond and issuer ratings.
The institution is once again emphasizing more efficient public spending and making cuts before a fiscal adjustment comes into force, in a form that is "draconian and with emergency measures".
Making cuts and improving efficiency in public spending is once again the main recommendation of the International Monetary Fund. In education alone, an area into which almost 8% of GDP goes, there is ample room for improvement.
Moody's has changed the outlook of the sovereign debt rating from stable to negative, noting the limited ability of the government to control the increased public spending and the high fiscal deficit.
From the press release by Moody's:
New York, November 19, 2015 -- Moody's Investors Service has today affirmed El Salvador's Ba3 foreign currency issuer and senior unsecured ratings and changed the outlook to negative from stable.
Experts are warning that the rapid growth of public spending could have negative implications if conditions change in the economic environment.
After the Ministry of Finance raised the ceiling on the deficit for the nonfinancial public sector to 4.1% at the end of September 2014, there are now significant differences between income and expenses, resulting in a deficit of $2.07 billion.
The difference in the yield on 30-year bonds relative to US Treasuries of the same period went from 3.33% in April to 3.85% up to December 4th.
The decision by the Executive to increase public spending in 2015 and continue to increase the fiscal deficit in an international environment which is a less favorable than it was in previous years is one of the reasons that explains the higher risk now being perceived by international investors regarding Costa Rican foreign debt bonds.
With the recent consent given by the Banguat for a new issuance of new debt totalling $1,917 million to finance the 2015 budget, the fiscal deficit could exceed 2.5% of GDP.
The private sector is not looking favorably on the approval given by the Monetary Board of the Bank of Guatemala for the possible issuance of $1.917 million in debt to finance part of the 2015 expenses, because the fiscal deficit would rise to levels above that considered acceptable in economic terms.