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.
The government of Costa Rica is seeking funding for infrastructure projects, taking advantage of low rates in the international market.
The annual amount cannot exceed $1 billion in order to avoid the placement of debt in a single issue.
Uncertainty about approval of the tax package in the National Assembly makes the national debt situation unsustainable.
The Ministry of Finance intends to place majority of the certificates in the medium and long term, "in order to improve the maturity profile and reduce the risk of refinancing".
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