Costa Rica Prepares $4 Billion Debt Plan

Costa Rica expects congressional approval within a month to sell as much as $4 billion in bonds abroad and plans an offering of at least $500 million by November, Vice President Luis Liberman said.

Monday, June 18, 2012

The country is preparing its first international issue since 2004, aiming to reduce the fiscal deficit which has already reached 5% of GDP.

In an interview with Bloomberg, Vice President Luis Liberman said they don't want to saturate the local market, and that the President will not reintroduce a new version of the tax package rejected by the Constitutional Court in April.

If approved, the borrowing plan would authorize the Executive to issue up to $4 billion in international bonds over the next 10 years, with a maximum of $1 billion per year.

More on this topic

Costa Rica Could Issue Bonds worth $4 billion

May 2012

The annual amount cannot exceed $1 billion in order to avoid the placement of debt in a single issue.

The Economic Affairs Committee of the Legislative Assembly gave its approval to a motion that seeks to double the maximum amount of foreign bonds that the Government may sell, going from $2 billion to $4 billion, said Rep. Patricia Perez, president of the commission.

Cabcorp Bottling Company Issues Bonds for $150 million

February 2012

The Guatemalan company Central America Beverage (Cabcorp) will release bonds worth $150 million on the U.S. market next week.

For the second time the company is to issues securities in international capital markets. The first time the issuance, rated BB, Ba2 and BB + by the rating agencies Standards & Poors (S & P), Moody's Investors and Fitch Ratings respectively, was acquired by Citigroup Global Market Inc.

Costa Rica to Finance 45% of its Budget with Loans

September 2011

Uncertainty about approval of the tax package in the National Assembly makes the national debt situation unsustainable.

The General Budget of the Republic for the Fiscal Year 2012 was presented by Finance Minister Fernando Herrero, who admitted that 45% of the $11,500 million to be financed will be provided by issuing public debt.

Costa Rica: Treasury Issues $1,904 million of Domestic Debt

July 2011

The treasury has issued 2% less bonds than planned, due to poor investor appetite for these securities.

In the first six months of the year, the Ministry of Finance intended to raise ¢975 billion ($ 1.933 billion) in the local market. However, poor demand for securities in national currency has forced the agency to aim for a figure slightly lower than projected.

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