Government Negotiates Bonds Abroad
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Loading... - Lina Richter
- 05 Aug 2024
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The Ministry of Finance (Minfin) has announced the successful placement of two Treasury Bond issues in international markets, totaling $1.4 billion. These bond issues reflect the government's proactive approach to securing funds for essential projects.
The first bond issue, amounting to $800 million, is particularly notable for its alignment with ESG (Environmental, Social, and Governance) criteria. This ESG fund, characterized as thematic due to its specific focus, is earmarked for projects aimed at serving impoverished communities. The bond has an interest rate of 6.55 percent per year and a maturity period of 12.5 years. The demand from investors was robust, reaching up to $3.182 billion, indicating strong confidence in the bond's objectives and the country’s economic prospects.
"The funds will be used to implement public policies related to the eradication of poverty and chronic malnutrition; the improvement of health and education; the promotion of decent jobs and sustainable economic growth," stated the Ministry of Finance.
The success of this bond issue is attributed in part to the positive message conveyed by President Bernardo Arévalo, which has fostered certainty and credibility in international financial markets. Additionally, the country's favorable rating from Moody's Investor Service has enhanced investor confidence in Guatemalan government bonds.
The second bond issue, amounting to $600 million, was secured at an annual interest rate of 6.05 percent with a maturity period of seven years. This issue also saw high demand, with investor interest totaling $2.39 billion.
“By integrating green and social spending into our financing, we seek to attract investments that promote renewable energy, security and sustainable food systems; affordable housing, access to essential services and other critical areas,” added the Ministry of Finance.
These bond issues demonstrate Guatemala’s commitment to sustainable development and the strategic use of international financial markets to fund essential projects aimed at improving the quality of life for its citizens.
