The Ministry of Finance will present a text in the coming days to replace the bill for the use of financing mechanisms in the international market, file No. 20535, with the objective that the Legislative Assembly authorizes the Executive to administer, issue and manage operations and financing instruments in said market, up to US $ 6,000 million (six billion US dollars), during the six years after the approval of the Law.
This management would be the responsibility of the Treasury and the resources could be obtained in US dollars or its equivalent in any other foreign currency. The maximum amount of financing in the international market may not exceed US $ 1,500 million (one thousand five hundred million US dollars), per calendar year during the first two years, and US $ 1,000 million in the rest.
The objective of the Bill 20535, presented on October 1, 2017, is to regulate the participation of the Ministry of Finance in international financial markets, in accordance with the principle of financial management for each economic period, based on the best use of funds of public resources, in terms of their effectiveness, cost and opportunity. The new text includes the observations made by the Technical Services Department of the Assembly.
“We hope that the approval of this project will allow us to have in the next two years, with US $ 1,500 million per year, which would improve the maturity profile to reduce the risk of refinancing, as well as a more orderly participation of the Treasury in the market” , explained Rocío Aguilar, Minister of Finance.
The financing instruments include an authorization to contract international credit lines, debt swaps and the application of guarantees in order to reduce the cost of emissions. In addition to contributing to meet financing needs, these instruments will allow for the exchange, consolidation, conversion, renegotiation and / or restructuring of financial obligations acquired by the central government.