The Eurobond payments expired on Tuesday, January 24th.
El Salvador’s government completed payments on $800 million of bonds on Monday. We guarantee.
El Salvador’s President Naive Bukele reported on social networks that he had “paid the full $800 million plus interest.”
A payment of $800 million was due on Jan. 24, but the government of El Salvador had already advanced some of those commitments through two bond buybacks that it launched in the market in 2022.
The buyback was in consideration of the 2023 and 2025 issues. Of the 2023 maturity, agreements were reached for $175.87 million, with $624.13 million remaining pending performance.
Government sources said $604.1 million was paid on Monday, in addition to $23.4 million in interest.
Risk assessors and economists say the El Salvadoran government’s limited liquidity puts it at risk of default by 2023 as investor markets shut down after a failed fiscal deal with the International Monetary Fund. I warned you several times. (IMF). .
Government agencies have applied various downgrades to the sovereign profile of El Salvador’s debt, but country risk as measured by the Emerging Markets Bond Index (EMBI) has not been seen since the instrument was applied to the economy in 2007. soared to a level With an interest rate of nearly 30%, countries cannot enter the international market to issue new government bonds.
Amid these accusations, the Bukele government has launched its first pre-purchase offer. This is an unprecedented operation in the market as it is the first time El Salvador has used this tool. The move was questioned by some economists, but it was a valid and novel option, such as the former governor of the Central Reserve Bank (BCR), Carlos Acevedo.
Last night, the president recalled those warnings and lashed out at the media, saying, “El Salvador will default on its debt in January 2023 because of Bitcoin bets.”
After repurchasing two bonds, El Salvador yesterday completed the remaining $604.1 million and $23.4 million in interest payments for a total of $800 million.