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       T R O U B L E D   C O M P A N Y   R E P O R T E R

                 L A T I N   A M E R I C A

          Friday, December 18, 2020, Vol. 21, No. 253

                           Headlines



A R G E N T I N A

CHUBUT PROVINCE: Fitch Downgrades LT IDRs to C
NEUQUEN PROVINCE: Fitch Upgrades LT IDRs to CC


B R A Z I L

ARGENTINA: Peronist Gov't. Had Wild-Ride First Year
OI SA: TIM, Telefonica and Claro Win Mobile Assets in $3.2BB Bid
REDE D'OR: S&P Raises ICR to BB on Higher Liquidity After IPO


M E X I C O

GRUPO AEROMEXICO: Committee Taps Santamarina y Steta as Counsel


S U R I N A M E

SURINAME: Fitch Upgrades LT Issuer Default Rating to C


T R I N I D A D   A N D   T O B A G O

DIGICEL GROUP: Again Fails in Legal Claim Against TSTT


U R U G U A Y

URUGUAY: IDB OKs $100M Loan for Natural Disaster, Emergency Impacts


V E N E Z U E L A

VENEZUELA: Oil Output at 407,000 bpd With No Active Rigs for 2 Mo.


X X X X X X X X

LATAM: Pandemic and Natural Disasters Challenge Region's Economies

                           - - - - -


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A R G E N T I N A
=================

CHUBUT PROVINCE: Fitch Downgrades LT IDRs to C
----------------------------------------------
Fitch Ratings has downgraded the Province of Chubut's Long-Term
Foreign and Local Currency Issuer Default Ratings (IDRs) to 'C'
from 'CC'. Fitch has also downgraded the Province's 7.75% senior
secured notes for USD650 million due 2026 to 'C' from 'CC'.
Additionally, Fitch lowered Chubut's Stand-alone Credit Profile
(SCP) to 'c' from 'cc'. Fitch relied on its Distressed Debt
Exchange (DDE) Rating Criteria and its rating definitions to
position the Province's ratings and SCP.

KEY RATING DRIVERS

The downgrade of Chubut's rating to 'C' indicates that a DDE
process has begun following the authorities' formal announcement in
Dec. 4, 2020 that it is soliciting the holders of the 2026 Notes
(Bocade) to consent to certain modifications. The stated response
period for the 'consent solicitation' closes Dec. 15, 2020 (such
date may be extended by the Province).

The proposal involves amendments to the notes maturity (from July
2026 to July 2030), amortization profile (smooth out principal
repayments throughout the life of the amended notes), and easing of
the interest rate conditions (step-up at 7.50% up to October 2021,
and 7.75% thereafter). The consent also involves amendments to
reserve accounts, additional royalties to be pledged as collateral,
revised covenants related to the royalty's coverage amount, and
waiver of past trigger events, among the most relevant. Should
majorities of creditors agree to the proposed 'consent
solicitation' at the thresholds specified in collective action
causes (CACs), the outcome would constitute a DDE as it involves a
material reduction in terms for creditors and is being pursued to
achieve a sustainable debt profile amid Argentina's macroeconomic
tensions, recent sovereign foreign currency debt restructure and
acute shortage of foreign exchange reserves that is hindering the
Province access to USD and to the international capital market.

According to the 'consent solicitation' release, with the amended
structure, the Province will achieve a maximum cumulative debt
service relief of USD169 million by October 2023.

On Nov. 14, 2020 the Province reached an 'Agreement in Principle'
to amend this secured note with a majority of bondholders (the
Group). Coupon payment on this note is due on January 26. Should a
deal with bondholders not be reached, or should significantly
progress on an agreement not be achieved, Fitch sees a high risk
that the event that was activated by the Trustee on July 2020 (oil
royalties covered 0.70x the debt service for Bocade, below the
minimum required royalties' coverage of 1.35x) may not be cured,
triggering an event of default if the royalty's coverage amount
don't reach at least 1.10x. This event would further dampen the
liquidity metrics of Chubut.

Fitch has also downgraded the issue ratings on this 7.75% senior
secured notes for USD650 million included in the 'consent
solicitation' to 'C'.

ESG - Environmental: Chubut has an ESG Relevance Score of '4'
revised from '3' for Biodiversity and Natural Resource Management
due to the province's significant economic and financial exposure
to the hydrocarbon sector, which negatively impacts the credit
profile and is relevant to the rating in conjunction with other
factors.

ESG-Social: Province of Chubut has an ESG Relevance Score of '4',
revised from '3', for Labour Relations & Practices, in recognition
of the Province's continuous delay in funding employee salaries;
currently employees in the third and fourth ranges have just
received their payments for September. The economic lockdown
triggered by the coronavirus and depressed oil prices have reduced
liquidity metrics and increased payables, including those related
to employee salaries, resulting in a negative impact to the credit
profile in conjunction with other factors.

ESG - Governance: Chubut has an ESG Relevance Score of '5' for
Creditor Rights, revised from '3'. The 'consent solicitation' if
accepted, would constitute a DDE as it involves a material
reduction in terms for creditors; hence it has negatively impacted
creditors' rights. This credit event is highly relevant to the
current rating downgrade and is a key rating driver on an
individual basis.

ESG - Governance: The Province has an ESG Relevance Score of '4'
for Rule of Law, Institutional and Regulatory Quality and Control
of Corruption, revised from '3', due to the negative impact on the
Province's credit profile from the weak regulatory framework and
the national policies of the sovereign in relation to the Province,
in conjunction with other factors.

Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity. For more information on Fitch's ESG
Relevance Scores, visit www.fitchratings.com/esg.

DERIVATION SUMMARY

Fitch positions the Province's ratings according the agency's
rating definitions.

RATING SENSITIVITIES

Factors that could, individually or collectively, lead to a
positive rating action/upgrade:

  -- Province of Chubut's IDRs and SCP would be reassessed upon the
completion of a debt restructuring process to reflect its new
credit profile.

Factors that could, individually or collectively, lead to a
negative rating action/downgrade:

  -- Acceptance by creditors of a change in terms as outlined in
the authorities' consent solicitation for the 2026 notes, would
constitute a DDE and will lower the IDRs to Restricted Default
(RD); and the ratings of the amended notes to Default 'D'.

  -- The absence of agreement by creditors in tandem with not
curing the trigger event, could activate an event of default in
accordance with the note's indenture.

REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF
RATING

The principal sources of information used in the analysis are
described in the Applicable Criteria.

ESG CONSIDERATIONS

Chubut has an ESG Relevance Score of '4' for Biodiversity and
Natural Resource Management due to the province's significant
economic and financial exposure to the hydrocarbon sector, which
negatively impacts the credit profile and is relevant to the rating
in conjunction with other factors. The Province of Chubut has an
ESG Relevance Score of '4' for Labor Relations & Practices in
recognition of the Province's continuous delay in funding employee
salaries (triggered by tight operating balances and weak liquidity
metrics), resulting in a negative impact to the credit profile in
conjunction with other factors.

Province of Chubut has an ESG Relevance Score of '4' for Rule of
Law, Institutional and Regulatory Quality and Control of
Corruption, reflecting the negative impact on the Province's credit
profile from the weak regulatory framework and the national
policies of the sovereign in relation to the Province, in
conjunction with other factors.

The Province also has an ESG Relevance Score of '5' for Creditor
Rights due to the proposed 'consent solicitation' that, if
accepted, involves a material reduction in terms for creditors.
This credit event is highly relevant to the current rating
downgrade and is a key rating driver on an individual basis. The
current rating action taken on Chubut reflects Fitch's view that a
default-like process has begun.

Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity. For more information on Fitch's ESG
Relevance Scores, visit www.fitchratings.com/esg. Unless otherwise
disclosed in this section, the highest level of ESG credit
relevance is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity.

NEUQUEN PROVINCE: Fitch Upgrades LT IDRs to CC
----------------------------------------------
Fitch Ratings upgraded the Province of Neuquen's Long-Term Foreign
and Local Currency Issuer Default Ratings (IDRs) to 'CC' from 'RD'.
Additionally, Fitch raised Neuquen's Standalone Credit Profile
(SCP) to 'cc' from 'rd'. Fitch relied on its rating definitions to
position the province's ratings and SCP.

In addition, Fitch has upgraded the province's issue ratings, which
include TICADE senior secured step-up notes for an original
USD348.69 million due May 12, 2030 and an outstanding of USD327.77,
and TIDENEU senior unsecured step-up notes for an original USD366
million and a current outstanding of USD377.16 million due April
27, 2030, to 'CC' from 'D' following the recent conclusion of the
province's external debt restructuring process. The bonds are rated
at the same level as the province's IDRs.

KEY RATING DRIVERS

The upgrade of Neuquen's rating to 'CC' reflects the completion of
several distressed debt exchanges (DDEs) by the province as part of
its debt restructuring process, which involved its TICADE and
TIDENEU notes as well as a USD bank loan with Credit Suisse. The
province's restricted default 'RD' situation has, in Fitch's view,
been cured through the formalization and operation of the
respective agreements that amended the original terms and
conditions of these debt instruments.

The debt restructuring provides some external debt service relief
for the province until YE 2022. Despite this relief, however, the
'CC' IDRs reflect deep liquidity and tight budgetary flexibility.
These are driven by fiscal challenges at the national and local
level, which continue to hinder the province's repayment capacity.
These challenges include an economic recession greatly exacerbated
by the coronavirus pandemic, and the province's inability to access
external markets to address financing needs. Additionally, the
ratings reflect the province's tight liquidity coverage ratios
(below 1.0x), which according to Fitch's rating case forecast
should continue over the next three years.

TICADE and TIDENEU bondholders accepted Neuquen's offer (87.12%)
and (93.0%), respectively, above the threshold set in the
collective action clauses (CACs). The Settlement Date for the DDE
execution of TICADE and TIDENEU notes was on Nov. 27, 2020. Shortly
after, Resolution No. 242/20 formally approved the DDE execution
for the province's Credit Suisse loan of USD265 million with an
outstanding amount of USD177.8 million as of September 2020.

On September 2020, the external debt instruments that were
restructured by the province comprised 71.2% of Neuquen's total
debt stock of ARS93.3 billion. Additionally, Neuquen's has
medium-term treasury bills for an outstanding balance of around
ARS7.4 billion (Sept. 2020) that mostly mature during 2021 and
could represent a refinancing risk for the province, considering
structural cash imbalances expected to remain high for 2021-2022.

For the TICADE notes, the main amendments included a postponement
of maturity until May 12, 2030 from May 12, 2028, and the reduction
of the accrued interest rate from 8.625% per annum, payable on a
quarterly basis, to a step-up coupon schedule starting at 5.170%
since Nov. 12, 2020 until Nov. 12, 2021, and reaching 8.625% per
annum until maturity.

TICADE began its capital amortizations on May 12, 2020; the capital
amortization payments were rescheduled and changed from 31 equal
capital payments to 38 quarterly capital payments to be covered as
follows: in February 12, May 12, August 12, and Nov. 12, 2021 equal
to 0.25% of the outstanding capital as of Nov. 12, 2020, prior to
the actual payment of the installment payable on that date; then in
February 12, May 12, August 12, and Nov. 12, 2022 equal to 1.25% of
the outstanding capital as of Nov. 12, 2020 prior to the actual
payment of the installment payable on that date; and from Nov. 12,
2022 until May 12, 2030, equal to the capital pending to date
divided by the amount of capital installments pending to date. The
first capital payment due after the settlement date will be Feb.
12, 2021.

In addition, modifications were made to the hydrocarbon royalties'
collateral pledge to match the bond's new maturity, as well as
cross default and reserve fund clause modifications. The liberation
of up to USD10.97 million from the debt service reserve account was
allocated to the consent consideration payment. The amendments also
modified the schedule for the gradual replenishment of the reserve
fund, among other adequations.

Similarly, for the TIDENEU notes, the deal mainly involved the
postponement of maturity until April 27, 2030 from April 27, 2025,
and the reduction in the accrued interest rate from 7.50% per annum
payable on a semi-annual basis to a step-up coupon schedule
starting at 2.5% per annum from Nov. 27, 2020 until Oct. 27, 2021,
to 4.625% per annum until Oct. 27, 2022, to 6.625% per annum until
Oct. 27, 2023, to 6.750% per annum until Oct. 27, 2024, to 6.875%
per annum until maturity.

TIDENEU's amortization schedule was also modified to 13 equal
semi-annual capital payments with the first installment commencing
in April. 27, 2024 from an original schedule of three equal annual
capital balloon payments starting in April 27, 2023. In addition,
70.8% of the Oct. 27, 2020 coupon was covered in the consent
consideration as a capitalized issuance of additional TIDENEU
notes, increasing the outstanding balance from an original USD366
million to USD377.16 million to date. The remaining part of the
coupon was settled as a cash payment.

The province's debt restructuring process stemmed from important
liquidity pressures that were in turn driven by an important
real-term revenue drop and expenditure increases due to the
coronavirus pandemic. In addition, the 2020 hydrocarbon external
price shock, is limiting Neuquen's fiscal capacity because of its
important economic and financial concentration in this cyclical
sector. Considering these factors, Fitch estimates that Neuquen
will have weak and negative operating balances for 2020-2022.

Risk Profile: 'Vulnerable'

Neuquen's Vulnerable Risk Profile reflects a 'Weaker' evaluation on
the six key risk factors (KRFs), considering the country's
structural weaknesses, in which Argentine local and regional
governments (LRGs) operate. Argentine LRGs operate in a context of
a weak institutional revenue framework and sustainability, high
expenditure structures, and tight liquidity and FX debt risks,
further worsened by macroeconomic recession, high inflation, sharp
currency depreciation and market uncertainty. The risk profile for
Argentine LRGs is assessed as 'Vulnerable', meaning there is a high
risk of operating cash flow not covering debt repayment coming
due.

Debt Sustainability: 'b' category

Fitch classifies Province of Neuquen as a type B LRG, as it covers
debt service from cash flow on an annual basis.

Under Fitch's rating case scenario (2020-2022) the primary metric
of payback burden (net adjusted debt to operating balance) will be
larger than 25x with a score of 'b', reflecting the province's weak
and negative operating balances. The actual debt service coverage
ratio (operating balance-to-debt service, ADSCR) will continue to
be below 1.0x; also, a 'b' score, which means a final 'b' debt
sustainability assessment.

Neuquen is located in the southwestern region of Argentina at the
northern end of the region known as the Patagonia and borders
western Chile. The province's economy is highly concentrated in the
hydrocarbon sector, contributing to around 30% of national oil
production (second after Chubut) and 55% of gas production.

Neuquen has an ESG Relevance Score of '5' for Creditor Rights due
to both the province's recent DDE and breach of a formal agreement,
which impeded the payment of debt service to bondholders, and
Fitch's expectation that fiscal challenges at the national and
local level will continue to hinder the province's future ability
to repay its debt obligations. This expectation has suppressed the
current rating assignment from a higher rating level, and therefore
creditor rights remains a key rating driver.

Neuquen has an ESG Relevance Score of '4' for Rule of Law,
Institutional & Regulatory Quality, Control of Corruption,
reflecting the negative impact the weak regulatory framework and
national policies of the sovereign have over the province in
conjunction with other factors.

Neuquen has an ESG Relevance Score of '4' for Biodiversity and
Natural Resource Management due to the province's significant
economic and financial concentration in the hydrocarbon sector,
which negatively influences the credit profile and is relevant to
the rating in conjunction with other factors.

DERIVATION SUMMARY

Neuquen has a Vulnerable Risk Profile and a 'b' debt sustainability
score. However, Fitch has relied on its rating definitions to
position the province's ratings and its SCP.

KEY ASSUMPTIONS

Fitch's rating case scenario is a "through-the-cycle" scenario,
which incorporates a combination of revenue, cost and financial
risk stresses. It is based on the 2015-2019 figures and 2020-2022
projected ratios. The key assumptions for Fitch's rating case
scenario include:

  -- 9.4% yoy increase in operating revenue, including a real-term
decrease in royalties, taxes and federal transfers in 2020; then an
average increase of 47.6% towards 2021 and 2022.

  -- 33.4% yoy increase in operating expenditure in 2020; then an
average increase of 41% towards 2021 and 2022.

  -- Average net capital balance of around minus ARS10.4 billion
for 2020-2022;

  -- Cost and stock of debt considers non-cash debt movements due
to currency depreciation with an annual average exchange rate of
ARS74.9 per U.S. dollar for 2020, ARS110.3 for 2021, and ARS155.0
for 2022.

RATING SENSITIVITIES

Factors that could, individually or collectively, lead to positive
rating action/upgrade: An improved operating balance that
strengthens the actual debt service coverage ratio above 1.0x on a
sustained basis, fueled by better economic prospects along with a
containment in the operating expenditure front.

Factors that could, individually or collectively, lead to negative
rating action/downgrade: Signs of deeper liquidity stress that
could compromise debt repayment capacity in the coming years,
including evidence of increased refinancing risk in its local and
foreign currency debt.

REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF
RATING

The principal sources of information used in the analysis are
described in the Applicable Criteria.

ESG CONSIDERATIONS

Neuquen has an ESG Relevance Score of '5' for Creditor Rights due
to both the province's recent DDE and breach of a formal agreement,
which impeded the payment of debt service to bondholders, and
Fitch's expectation that fiscal challenges at the national and
local level will continue to hinder the province's future ability
to repay its debt obligations. This expectation has suppressed the
current rating assignment from a higher rating level, and therefore
creditor rights remains a key rating driver.

Neuquen has an ESG Relevance Score of '4' for Rule of Law,
Institutional & Regulatory Quality, Control of Corruption,
reflecting the negative impact the weak regulatory framework and
national policies of the sovereign have over the province in
conjunction with other factors.

Neuquen has an ESG Relevance Score of '4' for Biodiversity and
Natural Resource Management due to the province's significant
economic and financial concentration in the hydrocarbon sector,
which negatively influences the credit profile and is relevant to
the rating in conjunction with other factors.

Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity.



===========
B R A Z I L
===========

ARGENTINA: Peronist Gov't. Had Wild-Ride First Year
---------------------------------------------------
Eliana Raszewski and Rodrigo Campos at Reuters report that
Argentina's Peronist government has had a wild ride in its first
year of government: a sovereign default, mammoth debt
restructurings, sliding reserves, a currency crisis and a weak
economy battered by COVID-19.

There have been wins and losses since taking office in December
last year. Debt deals were struck that allowed the government to
revamp some $110 billion in foreign currency bonds and push
repayments well into the future, according to Reuters.  Crunch
talks with the International Monetary Fund remain positive, the
report notes.

On the flip-side, weakness in the peso has drained foreign
reserves, while the central bank was forced into printing money to
bolster the pandemic-hit economy, the report relays.  Exports have
been sluggish amid devaluation fears, the report discloses.

Shamaila Khan, New York based head of EM debt strategies at
AllianceBernstein said Argentina had a "credibility issue," but has
taken step to get itself back into the global economy despite its
ninth sovereign default in May, the report notes.

"The fact is, the country has really taken care of their debt
repayment issues and it's in a good position to benefit from what
we think will be a much better global environment for EM in general
and for commodities, starting next year," she said, the report
relays.

Some investors warn that issues reviving growth could lead to
another default before long, the report says.  The country's risk
index dropped sharply after restructuring, but borrowing costs
remains sky-high. Argentine bond prices also remain in default
territory, the report adds.

"The restructuring was a necessary condition to resolve Argentina's
macro-economic problems," Guzman told Reuters in an interview last
week, notes the report. "Economic recovery is a necessary condition
for stability."

The report relates that Guzman forecasts an exit from recession in
the first half of next year, but the economic recovery has been far
from simple, hit hard by the coronavirus pandemic. The economy is
expected to contract some 11-12% this year and poverty has climbed,
says Reuters.

According to the report, the pandemic has helped bring down
inflation, though it remains at nearly 40% on an annual basis and
is expected to make a comeback as consumption recovers and as
savings are released into the real economy.

Camilo Tiscornia at consultancy C&T Asesores Economica said
monetary issuance to mitigate the impact of the virus, wage hikes
and fewer prize freezes would revive inflation, Reuters notes.

"It is very difficult to think that next year’s inflation will
end lower than this year," the report quoted Mr. Tiscornia as
saying.

The peso has been at the heart of the country's turbulent ride. It
crashed sharply mid-last year, causing a rush to the safe haven of
dollars. The government imposed tough currency controls, which have
been tightened this year, notes Reuters.

With tightly limited access to dollars, people flocked to
alternative and black markets, willing to pay a steep premium to
access greenbacks - driving a wide gap with the official rate, adds
the report.

The central bank, which had shelled out funds to prop up the peso
and to fund government spending, moved in recent months to ease
fears about its dwindling reserves, which some banks and analysts
estimate is around zero in net terms, the report further notes.

Reuters relates that Argentina is now in crunch talks with the IMF
for a deal to restore confidence in its markets. The two are trying
to craft a better relationship and write-over an acrimonious
history.

"We do think post an IMF program there will be more of a policy
anchor, which Argentina very much needs, and that will help bridge
that credibility deficit that exists today," said Khan, Reuters
notes.

                           About Argentina

Argentina is a country located mostly in the southern half of South
America.  It's capital is Buenos Aires. Alberto Angel Fernandez is
the current president of Argentina after winning the October 2019
general election. He succeeded Mauricio Macri in the position.

Argentina has the third largest economy in Latin America.  The
country's economy is an upper middle-income economy for fiscal year
2019 according to the World Bank.

Historically, however, its economic performance has been very
uneven, with high economic growth alternating with severe
recessions, income maldistribution and in the recent decades,
increasing poverty.

Standard & Poor's credit rating for Argentina stands at CCC+ with
stable outlook, which was a rating upgrade issued on Sept. 8,
2020.

Fitch's credit rating for Argentina was last reported at CCC with
n/a outlook, a rating upgrade from CC on Sept. 11, 2020.  DBRS'
credit rating for Argentina is CCC with n/a outlook, a rating
upgrade on Sept. 11, 2020.  Moody's credit rating for Argentina was
last set at Ca, a rating downgrade from Caa2 on April 4, 2020, with
a negative outlook.

As reported by The Troubled Company Reporter - Latin American, DBRS
noted that the recent upgrade in Argentina's ratings (September
2020) follows the closing of two debt restructuring agreements
between the Argentine government and private creditors.  The first
restructuring involved $65 billion in foreign-law bonds.  The deal
achieved the requisite participation necessary to trigger the
collective action clauses and finalize the restructuring on 99% on
the aggregate principal outstanding of eligible bonds.  DBRS added
that the debt restructurings conclude a prolonged default and
provide the government with substantial principal and interest
payment relief over the next four years.

DBRS further relayed that Argentina is also seeking a new agreement
with the International Monetary Fund (IMF) to replace the canceled
2018 Stand-by Agreement.  Obligations to the IMF amount to $44
billion, with major repayments coming due in 2022 and 2023.

OI SA: TIM, Telefonica and Claro Win Mobile Assets in $3.2BB Bid
----------------------------------------------------------------
Carolina Mandl at Reuters reports that TIM Participacoes,
Telefonica Brasil SA and America Movil SAB de CV's Claro won an
auction to acquire the mobile operations of Brazil's Oi SA with a
joint bid of 16.5 billion reais ($3.23 billion), the companies said
in a series of securities filings.

The winning trio, which had submitted an initial bid in July, plans
to split Oi's assets once they have antitrust approval. Oi, which
filed for bankruptcy protection in 2016, is selling assets to repay
creditors, according to Reuters.

The group was the auction's sole bidder, according to the filings,
the report notes.

The companies said the base price came to 15.744 billion reais,
with another 756 million reais to finance so-called "transition
services," which Oi will carry out over the next year in order to
facilitate the transfer of assets, the report relays.

TIM Participacoes, the local unit of Telecom Italia SpA, will pay
roughly 7.3 billion reais of the base price and another 476 million
reais for the transition services, it said in a filing, the report
discloses.

Telefonica Brasil, the local unit of Spain's Telefonica SA, will
pay roughly 5.5 billion reais of the base price and 179 million
reais in transition services, it said in a separate filing, the
report notes.

Claro will pay 22% of the total 16.5 billion reais, and in exchange
be granted 32% of the subscriber base from Oi's mobile business, it
said in its own filing, the report relays.

In their new bid, TIM, Telefonica Brasil and Claro also offered Oi
a long-term contract to rent its telecom infrastructure, the report
notes.

Reuters reported on the overall pricing of the bid earlier on, the
report discloses.

                            About Oi SA

Headquartered in Rio de Janeiro, and operating almost exclusively
within Brazil, the Oi Group provides services like fixed-line data
transmission and network usage for phones, internet, and cable,
Wi-Fi hot-spots in public areas, and mobile phone and data
services, and employs approximately 142,000 direct and indirect
employees.

On June 20, 2016, pursuant to Brazilian Law No. 11.101/05 (the
'Brazilian Bankruptcy Law'), Oi S.A. and certain of its
subsidiaries filed for recuperao judicial (judicial
reorganization)
in Brazil.

On June 21, 2016, OI SA and its affiliates Telemar Norte Leste
S.A. and Oi Brasil Holdings Cooperatief U.A. commenced Chapter 15
proceedings (Bankr. S.D.N.Y. Lead Case No. 16-11791).  Ojas N.
Shah, as foreign representative, signed the petitions.

Coop and PTIF are also subject to proceedings in the Netherlands.

The Chapter 15 cases are assigned to Judge Sean H. Lane.

In the Chapter 15 cases, the Debtors are represented by John K.
Cunningham, Esq., and Mark P. Franke, Esq., at White & Case LLP,
in New York; and Jason N. Zakia, Esq., Richard S. Kebrdle, Esq.,
and Laura L. Femino, Esq., at White & Case LLP, in Miami, Florida.

On July 22, 2016, the New York Court recognized the Brazilian
Proceedings as foreign main proceedings with respect to the
Chapter 15 Debtors, and granted certain additional related relief.

As reported in the Troubled Company Reporter-Latin America on
Oct. 20, 2020, S&P Global Ratings raised its global and national
scale issuer credit ratings on Brazil-based telecom operator Oi
S.A. to 'CCC+' and 'brBB', respectively, from 'SD' to reflect the
completion of the JRP amendment and the ongoing risk of a
conventional default.

REDE D'OR: S&P Raises ICR to BB on Higher Liquidity After IPO
-------------------------------------------------------------
S&P Global Ratings raised its credit issuer and issue-level ratings
on Brazilian hospital operator Rede D'Or Sao Luiz S.A. to 'BB' from
'BB-'. S&P also revised upward its recovery rating to '3' from '4'
on estimated higher value of the assets.

The company placed one of the largest IPOs in Brazil, raising R$8.4
billion, strengthening its balance sheet. The upgrade of the
company reflects its ample liquidity and to be rated one notch
above the 'BB-' sovereign rating on Brazil. In view of S&P, the
stronger liquidity position offers Rede D'Or sufficient buffers to
its exposure to the health insurance plan operators (Rede D'Or's
payers) that would face severe liquidity pressures under a
hypothetical sovereign default stress test, because they are highly
exposed to sovereign bonds.

S&P said, "Rede D'Or already announced some projects and M&As, and
it's currently waiting for antitrust approval, which would occur in
2021, adding about 1,800 beds. We believe that new M&A
opportunities may arise in the coming months, given the
pandemic-induced strains on the private hospital sector faced
during the pandemic. In the second quarter 2020, following the
government's decrees, private hospitals suspended elective
surgeries in order to have sufficient capacity to handle the
COVID-19 patients. This is pressuring operations, given hospitals'
high fixed-cost structure. As a result, we expect Rede D'Or to
continue playing the consolidator role in the sector and gradually
expanding its footprint in the country.

"Rede D'Or registered very low hospital visits and surgeries in the
second quarter 2020 given severe social-distancing requirements and
the government's decrees. However, in the third quarter 2020, the
company began to show signs of recovery with occupancy trending
back to historical levels of 75%-80% and revenue growth of 10.5%
over same period last year. This, coupled with our expectation of
cost-cutting initiatives and the integration of acquired assets and
mix of services, Rede D'Or's EBITDA margin should returning of
historical levels of 27%-30% in the next two years."



===========
M E X I C O
===========

GRUPO AEROMEXICO: Committee Taps Santamarina y Steta as Counsel
---------------------------------------------------------------
The official committee of unsecured creditors of Grupo Aeromexico,
S.A.B. de C.V. and its affiliates seeks approval from the U.S.
Bankruptcy Court for the Southern District of New York to hire
Santamarina y Steta S.C. as its Mexican counsel.

The firm's services will include:

     a. participating in meetings of the committee and
subcommittees and advising the committee of its rights, powers and
duties from a Mexican law perspective;

     b. assisting the committee in its meetings and negotiations
with the Debtors and other parties regarding Mexican law issues;

     c. advising the committee regarding issues of Mexican law;

     d. responding to inquiries from individual creditors related
to Mexican law issues;

     e. reviewing and analyzing court pleadings to the extent they
involve aspects of Mexican law;

     f. advising the committee regarding applicable foreign
proceedings; and

     g. performing all other necessary legal services as directed
by the committee.

The firm's attorneys and paraprofessionals will be paid at these
standard hourly rates:

   Billing Category      2020 Hourly Rates      2021 Hourly Rates
      Partners               $400 - $520             $405 - $525
      Of Counsel             $440 - $485             $450 - $495
      Counsel                $310 - $330             $315 - $355  
      Associates             $160 - $390             $165 - $400
      Paraprofessionals      $110 - $180             $115 - $185

Jorge Alejandro Leon Orantes Baena, a partner at Santamarina y
Steta, disclosed in court filings that the firm does not hold or
represent any interest adverse to the Debtors' estates and is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.

Mr. Leon Orantes Baena also made the following disclosures in
response to the request for additional information set forth in
Paragraph D.1 of the U.S. Trustee Guidelines:

     Question: Did you agree to any variations from, or
alternatives to, your standard or customary billing arrangements
for this engagement?

     Response: No.

     Question: Do any of the professionals included in this
engagement vary their rate based on the geographic location of the
bankruptcy case?
     
     Response: No.

     Question: If you represented the client in the 12 months
pre-petition, disclose your billing rates and material financial
terms for the pre-petition engagement, including any adjustments
during the 12 months prepetition. If your billing rates and
material financial terms have changed post-petition, explain the
difference and the reasons for the difference.

     Response: The firm did not represent the committee prior to
the Debtors' Chapter 11 cases.

     Question: Has your client approved your prospective budget and
staffing plan, and, if so, for what budget period?

     Response: The committee and the firm expect to develop a
prospective budget and staffing plan to comply with the U.S.
Trustees requests for information and additional disclosures, and
any other orders of the court, recognizing that in the course of
the Debtors' Chapter 11 cases, there may be unforeseeable fees and
expenses that will need to be addressed by the committee and the
firm.

The firm can be reached through:

     Jorge Alejandro Leon Orantes Baena, Esq.
     Santamarina y Steta S.C.
     Campos Eliseos 345 floors 2 and 3
     Chapultepec Polanco, 11560
     Miguel Hidalgo, Mexico City, MX
     Telephone: +52 55 5279 5400

                      About Grupo Aeromexico

Grupo Aeromexico, S.A.B. de C.V. -- https://www.aeromexico.com/ --
is a holding company whose subsidiaries are engaged in commercial
aviation in Mexico and the promotion of passenger loyalty
programs.

Aeromexico, Mexico's global airline, has its main hub at Terminal 2
at the Mexico City International Airport. Its destinations network
features the United States, Canada, Central America, South America,
Asia and Europe.

Grupo Aeromexico and three of its subsidiaries sought Chapter 11
protection (Bankr. S.D.N.Y. Lead Case No. 20-11563) on June 30,
2020. In the petitions signed by CFO Ricardo Javier Sanchez Baker,
the Debtors reported consolidated assets and liabilities of $1
billion to $10 billion.

The Debtors tapped Davis Polk and Wardell LLP as their bankruptcy
counsel, White & Case LLP and Cervantes Sainz S.C. as special
counsel, and Rothschild & Co US Inc. and Rothschild & Co
Mexico S.A. de C.V. as financial advisor and investment banker.
Epiq Corporate Restructuring, LLC is the Debtors' administrative
agent.  

The U.S. Trustee for Region 2 appointed a committee to represent
unsecured creditors on July 13, 2020.  The committee is represented
by Morrison & Foerster LLP.




===============
S U R I N A M E
===============

SURINAME: Fitch Upgrades LT Issuer Default Rating to C
------------------------------------------------------
Fitch Ratings has upgraded Suriname's Long-Term Foreign-Currency
Issuer Default Rating (IDR) to 'C' from 'RD'. In addition, Fitch
has upgraded Suriname's 2026 notes to 'C' from 'D' and downgraded
Suriname's 2023 notes to 'D' from 'C' and subsequently upgraded the
issue rating for the 2023 notes to 'C' from 'D'.

KEY RATING DRIVERS

The upgrades of Suriname's Long-Term Foreign-Currency (LT FC) IDR
to 'C' from 'RD' and the issue rating for the 2026 notes to 'C'
from 'D', follow the completion on December 4 of Suriname's
"consent solicitation" launched November 13 and modified November
25, seeking a standstill of debt service due this quarter on
Suriname's 2023 and 2026 notes. Fitch deems this to constitute the
execution and completion of a distressed debt exchange (DDE) event,
according to Fitch's Sovereign Rating Criteria, which resolves the
government's missed coupon payment on the 2026 notes.

The downgrade of Suriname's issue rating on the 2023 notes to 'D'
from 'C' reflects Fitch's view that the restructuring of the notes
constitutes a DDE. The subsequent upgrade of the 2023 notes to 'C'
reflects that the DDE has been completed. This is the government of
Suriname's second consent solicitation to reschedule external debt
service during 2020.

The government and creditors agreed via the consent solicitation to
reschedule to March 31, 2021 a total USD48.5 million in debt
service originally due during October 2020-December 2020 on the
2023 and 2026 notes, plus accrued interest on the arrears at the
contracted applicable rates. Further conditional amendments of the
debt service schedule were also introduced. If Suriname agrees to a
funded program with the IMF prior to 24 March 2021:

  -- USD25.4 million interest originally due October 26 on the 2026
notes would be rescheduled to April 26, 2021 when a similarly sized
coupon is due;

  -- USD8 million interest due December 30 on the 2023 notes would
be deferred one month to April 26, 2021, and;

  -- USD15 million principal due December 30 on the 2023 notes
would be deferred one month to April 26, 2021.

The 'C' ratings on Suriname's LT-FC IDR and FC obligations reflect
the government's ongoing debt restructuring negotiations with the
2023 and 2026 noteholders, which Fitch deems a default-like process
that the agency expects will result in a distress debt exchange or
a traditional payment default (see "Fitch Downgrades Suriname's
Long-Term Foreign Currency IDR to 'C'," published Oct. 26, 2020).

Suriname's fundamental debt sustainability challenges remain and
reflect the government's high debt (expected to reach 137% of GDP
at YE 2020, excluding any agreement with creditors), structurally
large budget deficit, distressed financing conditions, and acute
shortage of foreign currency.

ESG Considerations

Suriname has an ESG Relevance Score (RS) of 5 for both Political
Stability and Rights and for the Rule of Law, Institutional and
Regulatory Quality and Control of Corruption, as is the case for
all sovereigns.

These scores reflect the high weight that the World Bank Governance
Indicators (WBGI) have in Fitch's proprietary Sovereign Rating
Model. Suriname has a medium WBGI ranking at the 43rd percentile,
reflecting a recent track record of peaceful political transitions,
a moderate level of rights for participation in the political
process, moderate institutional capacity, established rule of law
but a high level of corruption.

Suriname has an ESG Relevance Score (RS) of 5 for Creditor Rights
as willingness to service and repay debt is highly relevant to the
rating and is a key rating driver with a high weight, as evident in
two debt defaults in 2020.

RATING SENSITIVITIES

Factors that could, individually or collectively, lead to positive
rating action/upgrade:

  -- Public Finances: Payment of pending interest payments within
stipulated grace periods or a renouncement by the government of
plans to restructure its debt.

Factors that could, individually or collectively, lead to negative
rating action/downgrade:

  -- Public Finances: A further distressed debt exchange.

  -- Public Finances: Failure to pay interest due to private sector
creditors within the stipulated grace period.

SOVEREIGN RATING MODEL (SRM) AND QUALITATIVE OVERLAY (QO)

In accordance with its rating criteria for ratings of 'CCC' and
below, Fitch's sovereign rating committee has not utilized the SRM
and QO to explain the ratings, which are instead guided by the
ratings definitions.

Fitch's SRM is the agency's proprietary multiple regression rating
model that employs 18 variables based on three-year centered
averages, including one year of forecasts, to produce a score
equivalent to a LT FC IDR. Fitch's QO is a forward-looking
qualitative framework designed to allow for adjustment to the SRM
output to assign the final rating, reflecting factors within our
criteria that are not fully quantifiable and/or not fully reflected
in the SRM.

KEY ASSUMPTIONS

Fitch expects global indicators to move broadly in line with
Fitch's Global Economic Outlook forecasts.

SUMMARY OF DATA ADJUSTMENTS

SUMMARY OF DATA ADJUSTMENTS

  -- Fitch analyzes government operations on a cash basis (which
includes net payments of supplier arrears) using published Ministry
of Finance statistics on arrears flows, which have been material in
some historical periods. Fitch adopts this conservative treatment
because it better explains the scale of the government's financing
needs and change in government debt/GDP during 2015-2019 than the
narrower government commitment balance also published by the
Ministry of Finance.

  -- Suriname's National Debt Law uses historical exchange rates to
value government debt/GDP. Fitch values government debt/GDP at
reference period-end market exchange rates. Fitch's conversion
ensures that government debt/GDP is valued in line with market best
practices, including during periods of exchange rate volatility.

REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF
RATING

The principal sources of information used in the analysis are
described in the Applicable Criteria.

INFORMATION LIMITATIONS

  -- The stock of government arrears to suppliers is not regularly
publicly disclosed. Fitch utilizes published data on the flow of
arrears incurred and payments thereof to observe the direction of
net arrears and attendant financing pressure.

ESG CONSIDERATIONS

Suriname has an ESG Relevance Score of '5' for Political Stability
and Rights as World Bank Governance Indicators have the highest
weight in Fitch's SRM and are highly relevant to the rating and a
key rating driver with a high weight.

Suriname has an ESG Relevance Score of '5' for Rule of Law,
Institutional & Regulatory Quality and Control of Corruption as
WBGI have the highest weight in Fitch's SRM and are therefore
highly relevant to the rating and are a key rating driver with a
high weight.

Suriname has an ESG Relevance Score of '5' for Creditor Rights as
willingness to service and repay debt is highly relevant to the
rating and is a key rating driver with a high weight.

Suriname has an ESG Relevance Score of '4' for Human Rights and
Political Freedoms as the Voice and Accountability pillar of the
WBGI are relevant to the rating and a rating driver.

Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity.



=====================================
T R I N I D A D   A N D   T O B A G O
=====================================

DIGICEL GROUP: Again Fails in Legal Claim Against TSTT
------------------------------------------------------
Trinidad Express reports that DIGICEL (Trinidad and Tobago) has
again failed in a legal claim against its mobile competitor,
Telecommunication Services of Trinidad and Tobago (TSTT), related
to the portability of customers' cellphone numbers from one network
to the other.

The latest defeat took place at the Appeal Court when two judges
struck down a challenge Digicel had filed against the ruling of a
High Court judge in September in which it also was at the losing
end, according to Trinidad Express.

The dismissal of the appeal came from Justices Prakash Moosai and
Vashiest Kokaram as they upheld the ruling of Justice Nadia
Kangaloo delivered in mid-September.

The contentious issue was the decision of TSTT to reject the
transfer of cellular numbers of its customers who were willing to
switch to the Digicel network, the report notes.

Digicel was asking the court to grant an interim injunction
preventing TSTT from continuing to do so, the report relays.  It
was also seeking damages for breach of contract, breach of TSTT's
statutory duties under the Protection of Unfair Competition Act
(PAUCA) as well as for loss and damage it said it suffered due to
TSTT's conduct, the report discloses.

Digicel also argued that its goodwill and reputation had been
adversely affected by this conduct, the report notes.

TSTT, on the other hand, argued that the court had no jurisdiction
to determine the matters raised, and that the Telecommunications
Authority of Trinidad and Tobago (TATT) was the more competent body
to hear and determine the dispute, the report says.

                      Unprecedented Increase

In her ruling, Justice Kangaloo agreed with TSTT and struck out the
claim, saying if the reliefs sought were granted, there stood a
greater risk of injustice taking place, the report relays.

Instead, the judge ruled that the dispute first had to be raised
with (TATT) for a resolution to be arrived at and not the High
Court, the report notes.

In 2014, TATT required all operators, including Digicel and TSTT,
to facilitate the porting of numbers between the networks, the
report recalls.

In its claim, Digicel alleged that during the period May to June
2020, there has been an unprecedented increase in the rejection by
TSTT of requests from consumers wishing to port their numbers to
Digicel's network, the report says.

Digicel claimed this unprecedented increase in rejections was
attributable to the increased and wrongful application by TSTT of
two specific rejection codes, "Bad Debt" and "Other", during the
porting process, the report notes.

Additionally, Digicel claimed TSTT sought to wrongfully induce
consumers to stay with its network, by offering them incentives in
the form of enhanced terms to their existing packages, after
consumers initiated the porting process, and by making the porting
process more administratively difficult for both Digicel and
consumers, the report relays.

But in her ruling, Justice Kangaloo said while she agreed with some
of the submissions by attorneys for Digicel, the claim had to fail,
the report notes.

                           Wide Discretion

In the court's oral ruling delivered by Justice Kokaram, the judges
said they did not find Justice Kangaloo to be plainly wrong in her
findings, the report discloses.

They said the judge had a wide discretion to stay the proceedings,
the report says.

"The court has appropriately managed the dispute and therefore the
trial judge was not plainly wrong when she stayed these
proceedings," said Justice Kokaram.

In addition to having the appeal dismissed, Digicel was also
ordered to pay two-thirds of TSTT's legal cost in defending the
appeal, the report relays.

Digicel was represented by attorneys Adrian Byrne and Jason Mootoo,
while Martin Daly SC led the case for TSTT, the report adds.



=============
U R U G U A Y
=============

URUGUAY: IDB OKs $100M Loan for Natural Disaster, Emergency Impacts
-------------------------------------------------------------------
The Inter-American Development Bank (IDB) has approved a $100
million contingency loan to finance a program launched by Uruguay
to cushion the impact of natural disasters and health emergencies
on its public finances.

The operation completes this year's special support program for
Uruguay which, including disbursements and new credit instruments
available, has exceeded the amount of $1.7 billion. The IDB's
support aims to uphold the country's efforts to face the health
emergency, with a special focus on the most vulnerable sectors, and
jumpstart the economy by providing micro, small, and medium sized
enterprises with access to credit.

The latest lending was approved under the Contingent Credit
Facility for Natural Disaster and Public Health Emergencies (CCF),
an innovative tool of the IDB to promote an integrated approach to
the financial management of natural disasters and public health
risks based on planning and pre-financing of contingent fiscal
liabilities.      

The resources will be used to structure a stable, efficient, and
rapid-access ex-ante financial coverage to meet extraordinary
public spending needs during natural disaster and public health
emergencies.

Climate change is a phenomenon of particular relevance to Uruguay
due to the increase of climatic shifts and the frequency and
intensity of severe droughts, with their corresponding impacts on
productivity, availability of water resources, and public health.
In the face of this growing hazard, the operation includes
financial coverage for droughts.

In addition, the operation contributes to improve the country's
integral disasters risk management by promoting improvements in the
five strategic pillars of the Integrated Natural Disaster Risk
Management Plan. These pillars are: governability and guiding
framework development; risk identification and awareness; disaster
risk reduction; emergency preparedness; and risk financial
management.

The potential beneficiaries are the entire population of Uruguay,
in particular the affected populations that receive emergency
assistance under the proposed coverage. The operation will also
contribute to the cross-cutting issue of Gender Equality and
Diversity by promoting the inclusion of a gender perspective in the
country's Disaster Risk Management.

The $100 million contingent IDB loan is for a 25-year term, with a
5.5-year period of grace and an interest rate based on LIBOR.



=================
V E N E Z U E L A
=================

VENEZUELA: Oil Output at 407,000 bpd With No Active Rigs for 2 Mo.
------------------------------------------------------------------
The Latin American Herald reports that according to a December
report by the Organization of the Petroleum Exporting Countries
(OPEC), Venezuela has been doing without active oil rigs for the
second month in a row, which may suggest the nation's output might
have been brought to a standstill.

The last active rig was recorded by OPEC in September while the
state-run company Petroleos de Venezuela (PDVSA) has been reducing
accumulated inventories, according to The Latin American Herald.

PDVSA had 122 active rigs in 2011, but the number went down to 49
in 2017 and to 25 during the first quarter of 2020, the report
notes.

However, OPEC also noted in its report that the South American
nation produced an average of 407,000 barrels per day (bpd) in
November, an increase of 25,000 bpd amid a scenario of output cuts
from the rest of the group of oil producers, the report relays.

Output is still below the average recorded during the first quarter
of this year which stood at 730,000 bpd, OPEC said, the report
relays.  In particular, production dropped 18% from the second
quarter of 2020 and 49% from the average recorded in 2019, the
report notes.

According to official government figures, output declined by 39,000
bpd to 434,000 bpd in November and, according to those same
figures, production fell by 47.13% from the first quarter and the
decline was of 57.16% compared with the official average of 2019,
the report discloses.

Oil production in Venezuela, the country with the world's largest
reserves of crude, has sunk to levels not seen since 1945, the
report adds.

                            Venezuela

Venezuela, officially the Bolivarian Republic of Venezuela, is a
country on the northern coast of South America, consisting of a
continental landmass and a large number of small islands and islets
in the Caribbean sea.  The capital is the city of Caracas.

Hugo Chavez was president to Venezuela from 1999 to 2013.  The
Chavez presidency was plagued with challenges, which included a
2002 coup d'etat, a 2002 national strike and a 2004 recall
referendum.  Nicolas Maduro was elected president in 2013 after
the death of Chavez.  Maduro won a second term at the May 2018
Venezuela elections, but this result has been challenged by
countries including Argentina, Chile, Colombia, Brazil, Canada,
Germany, France and the United States who deemed it fraudulent and
moved to recognize Juan Guaido as president.

The presidencies of Chavez and Maduro have challenged Venezuela
with a socioeconomic and political crisis.  It is marked by
hyperinflation, climbing hunger, poverty, disease, crime and death
rates, social unrest, corruption and emigration from the country.

S&P Global Ratings, in May 2019, removed its long- and short-term
local currency sovereign credit ratings on Venezuela from
CreditWatch with negative implications and affirmed them at
'CCC-/C'. The outlook on the long-term local currency rating is
negative. At the same time, S&P affirmed its 'SD/D' long- and
short-term foreign currency sovereign credit ratings on Venezuela.

Moody's credit rating (long term foreign and domestic issuer
ratings) for Venezuela was last set at C with stable outlook in
March 2018.  Meanwhile, Fitch's long term issuer default rating
for Venezuela was last in 2017 at RD and country ceiling was CC.
Fitch, on June 27, 2019, affirmed then withdrew the ratings due
to the imposition of U.S. sanctions on Venezuela.



===============
X X X X X X X X
===============

LATAM: Pandemic and Natural Disasters Challenge Region's Economies
------------------------------------------------------------------
The International Monetary Fund disclosed that COVID-19 has not
spared Central America. Confirmed cases have multiplied to well
over 600,000 in November, with the death toll exceeding 14,000.

Countries have taken prompt containment measures, with the
strictest enforced in the Northern Triangle of El Salvador,
Guatemala, and Honduras, amid inadequate testing and tracing
capacities and limited access to basic health services.
Insufficient hospital capacity and protective equipment, elevated
poverty, and, in some cases, densely populated cities have worsened
the human toll. Low levels of testing and weak reporting in some
countries suggest the situation might be even worse than official
statistics.

The economic toll has been heavy as well. The trade shock has been
particularly strong in El Salvador, Nicaragua, and Panama (via a
severe drop in revenues from lower traffic in the Canal).

Tourist arrivals dropped sharply in Costa Rica and the Dominican
Republic, where tourism receipts made up 6–10 percent of GDP
before the pandemic.

On average, lockdowns have contributed about 70 percent to the
slowdown, especially in Panama, El Salvador, and the Dominican
Republic, reflecting the combination of stringent containment
measures and a higher share of contact-intensive sectors.

                         Hurricane Season

Multiple natural disasters added to the economic destruction and
increased the risk of worsening the pandemic: two tropical storms
in June in El Salvador; a severe drought in Honduras; and two
recent back-to-back category 4 hurricanes that hit Nicaragua,
Guatemala, and Honduras particularly hard.

Several factors have helped mitigate the double health and climate
shocks, in particular a solid agricultural performance and, since
May, a strong rebound of remittances, on which most Central
American countries depend heavily. Lower oil prices benefitted the
region, a net importer. Medical equipment exports have partly
offset the tourism downfall in Costa Rica.

Nonetheless, with tourism and trade unlikely to return to
pre-pandemic levels soon, real GDP is projected to contract sharply
in 2020, by nearly 6 percent, ranging from -2 percent in Guatemala
to -9 percent in El Salvador and Panama. The speed of the recovery
will depend on countries' exposure to the world economy; the
stringency of containment measures as infections continue to rise;
the availability of vaccines; and their ability to sustain
supportive policies. The economic impact of the recent natural
disasters, still being assessed, might further lower these
estimates.

                           More With Less

Extensive fiscal and monetary support have helped mitigate the
economic and social impact. Most countries increased spending,
extending subsidies and transfers to reach the informal sector that
accounts for up to 60 percent of employment in some countries (for
instance, in Guatemala and Honduras). Countries granted temporary
tax relief to key economic sectors, and provided liquidity support
and credit relief through rate cuts, lending facilities, credit
guarantees, and regulatory forbearance.

The fiscal cost of these measures has been significant, squeezing
countries' already strained finances and causing public debt to
swell. But targeted support will need to continue, to resolve the
health emergency, support the nascent recovery, and prevent that
already elevated levels of poverty, inequality, and unemployment
rise even more.

Emergency financial assistance from the IMF and other multilateral
institutions has provided temporary relief, and most countries
issued debt in international markets. But financing needs remain
large, averaging 9 percent of GDP over the next three years, amid
tight financing conditions. A few countries have already approached
the IMF for additional support, which could catalyze financing and
anchor their adjustment programs

                             The Road Ahead

Looking ahead, fiscal consolidation will be necessary to rebuild
countries' financial health, and a broad political and social
dialogue will be critical to build support for gradual,
transparent, and sustainable medium-term plans. Spending should be
reprioritized toward adequate, well-targeted social safety nets to
protect the vulnerable, and efficient public investment in health,
education, infrastructure, and technology to narrow the existing
skills and infrastructure gaps and enhance resilience to future
shocks.

Ambitious structural reforms will need to complement macro-policy
actions to boost competitiveness and increase growth potential,
reduce inequality and informality, support a strong and green
recovery, and build resilience to climate shocks. Regional
authorities are already moving in this direction, preparing a
reconstruction plan that prioritizes financing to projects that
adapt and respond to climate change effects.

The financial system will require attention, as widespread job
losses and business closures will likely weigh on banks' health.
Supervisory authorities will need to support flexible use of
capital and liquidity buffers consistent with international
standards, while closely monitoring financial stability risks and
preparing to unwind the support measures when warranted.

As it recovers from the health emergency, the region will face
multiple challenges on the way to an inclusive and sustainable
economic recovery. It will require careful phasing out of emergency
policies to reduce debt sustainability risks, while protecting the
nascent recovery and the social fabric. Access to additional
multilateral loans and market financing will be needed to meet
sizable medium-term financing needs.


                           *********


S U B S C R I P T I O N   I N F O R M A T I O N

Troubled Company Reporter-Latin America is a daily newsletter
co-published by Bankruptcy Creditors' Service, Inc., Fairless
Hills, Pennsylvania, USA, and Beard Group, Inc., Washington, D.C.,
USA, Marites O. Claro, Joy A. Agravante, Rousel Elaine T.
Fernandez, Julie Anne L. Toledo, Ivy B. Magdadaro, and Peter A.
Chapman, Editors.

Copyright 2020.  All rights reserved.  ISSN 1529-2746.

This material is copyrighted and any commercial use, resale or
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re-mailing and photocopying) is strictly prohibited without prior
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Information contained herein is obtained from sources believed to
be reliable, but is not guaranteed.

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delivered via e-mail.  Additional e-mail subscriptions for members
of the same firm for the term of the initial subscription or
balance thereof are US$25 each.  For subscription information,
contact Peter A. Chapman at 215-945-7000.
.


                  * * * End of Transmission * * *