---

       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, March 4, 2022, Vol. 23, No. 40

                           Headlines



A R G E N T I N A

CHACO: Fitch Raises LongTerm Issuer Default Ratings to 'CCC'
ENTRE RIOS: Fitch Raises LT Issuer Default Ratings to 'CCC-'
SALTA: Fitch Raises LT Issuer Default Ratings to 'CCC'


B E L I Z E

BELIZE: Pandemic Has Had a Severe Impact on Country, IMF Says


B O L I V I A

BOLIVIA: S&P Assigns 'B+' Rating on US$850MM Sr. Unsecured Notes


B R A Z I L

AZUL AIRLINES: Assures Recovery in Total Demand in 2022


C A Y M A N   I S L A N D S

LMR LONG HORIZON: Dissolution Hearing Set for March 21


J A M A I C A

[*] JAMAICA: Travel Restrictions Removal to Boost Sector, JHTA Says


P U E R T O   R I C O

EMPACADORA Y PROCESADORA: Seeks Approval to Hire Financial Advisor
EMPACADORA Y PROCESADORA: Taps Fuentes Law Offices as Counsel
PUERTO RICO: PREPA Bondholders Say Mediator Needed for Plan B

                           - - - - -


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

CHACO: Fitch Raises LongTerm Issuer Default Ratings to 'CCC'
------------------------------------------------------------
Fitch Ratings has upgraded Province of Chaco's Long-Term Foreign
and Local Currency Issuer Default Ratings (IDRs) to 'CCC' from
'CC'. Additionally, Fitch also upgraded to 'CCC' from 'CC' the
rating for Chaco's step-up USD262.6 million senior unsecured notes
due 2028. The bonds are rated at the same level as the province's
IDRs. Additionally, Fitch raised Chaco's Standalone Credit Profile
(SCP) to 'ccc' from 'cc'. Fitch relied on its rating definitions to
position Chaco's ratings and SCP.

The rating action reflects Chaco's improvement in its debt
sustainability score under Fitch's rating case (2021-2023),
underpinned by last year's distressed debt exchange (DDE) and the
pace of economic recovery in the country. Additionally, the ratings
weigh a 'CCC' macroeconomic and regulatory environment that exposes
Chaco to a high volatile and less predictable institutional
framework. As of September 2021, the province liquidity position
maintains its upward trend underpinned by stable operating
balances.

KEY RATING DRIVERS

Risk Profile: 'Vulnerable'

Fitch assesses the province's risk profile as 'Vulnerable' in line
with other Fitch-rated Argentine local and regional governments
(LRGs). Chaco's risk profile combines all six factors assessed at
Weaker (revenue robustness and adjustability, expenditure
sustainability and adjustability, debt and liquidity robustness and
flexibility) and considers the sovereign IDR.

The assessment reflects Fitch's view of a very high risk relative
to international peers that the issuer's ability to cover debt
service with the operating balance may weaken unexpectedly over the
forecast horizon (2021 based on 3Q21 figures-2023) due to lower
revenue, higher expenditure, or an unexpected rise in liabilities
or debt or debt-service requirement.

Revenue Robustness: 'Weaker'

The assessment reflects the evolving nature and imbalanced of the
national fiscal framework, dependence on a 'CCC' sovereign
counterparty risk for 85.5% (three year-average) of its total
revenue, amid an adverse macroeconomic environment indicated by
high inflation. Federal co-participation tax transfers are a very
important component of subnational fiscal performance. Similarly,
own-tax revenue increased 45.6% annually despite the contraction of
the national GDP of 9.9%. As of December 2021, co-participation tax
transfers show an accumulated 62.7% annual nominal term growth; and
own-revenues could increase 50%, for a total operating revenue
growth of 68.6%.

At the time, the nation's future economic prospects are uncertain
until it finalizes an IMF deal; therefore, predictability of
non-mandatory transfers is clouded, especially the re-taking of
additional fiscal consolidation agreements, new fiscal reform
initiatives or changes to the national subsidies scheme where
provinces could be negatively impacted from larger expenditure
responsibilities.

Revenue Adjustability: 'Weaker'

Chaco's ability to generate additional revenue in response to
possible economic downturns is limited, like all Fitch-rated
Argentine LRGs. However, for Chaco this is further exacerbated
given its high reliance in national transfers such as
co-participation tax transfers and non-mandatory transfers such as
National Treasury Grants -- ATN. Overtime, the former has shown
stability but the latter is subject to discretion; hence it is less
predictable and certain.

Fitch considers that local revenue adjustability is low and is
challenged by the country's large and distortive tax burden. The
negative macroeconomic environment further limits the province's
ability to increase tax rates and expand tax bases to boost its
local operating revenues. Structural high inflation also constantly
erodes real-term revenue growth and affects affordability. Chaco's
wealth metrics are below the national average, which lags
international peers, also weighs in the assessment of this key
rating factor.

Expenditure Sustainability: 'Weaker'

Argentine provinces have high expenditure responsibilities and the
country's fiscal regime is structurally imbalanced regarding
revenue-expenditure decentralization. This is further exacerbated
by the high inflationary operating environment, which weaken
Chaco's control over total expenditure growth prospects. Argentine
provinces have high expenditure responsibilities, including health
care, education, water, transportation and other services.

Since the nation's standby agreement with the IMF in 2018, the
federal government transferred some additional expenditure
responsibilities to the provinces by cutting down current and
capital transfers, as well as subsidies in the inter-provincial
transport services and electricity sector (social tariffs). In
Fitch's view, spending decentralization could continue to rise in
the current negotiation with the IMF. Fitch will monitor how this
agreement unfolds and impact the provinces' fiscal framework.

Since 2017, the province has turned its margins from negative
territory toward a positive operating balance of 8.6% of operating
revenues in 2019, 16.9% in 2020; 27.0% as of September 2021. This
trend is largely explained by an operating expenditure (opex)
growing below inflation; 31.6% in 2020 (average inflation: 42.6%).

Fitch believes this trend is unsustainable driven by high
expenditure needs in health care, social, justice and public
services; in conjunction to the lag effect that inflation tends to
have on real-term wages; thus, from 2022 Fitch estimates opex will
increase above inflation and will lower operating balance to 9.3%
in 2023, below the 2019-2020 average of 12.7%. High inflation
hinders expenditure sustainability and predictability. Currency
depreciation also affects expenditure costs, such as capex
projects.

Expenditure Adjustability: 'Weaker'

Fitch views Chaco's leeway or flexibility to cut expenses as weak
relative to international peers, considering an average of only
around 10.0% of consolidated provincial total expenditures going to
capex from 2016 to 2020, which decreased to 7.1% at YE 2020.
Similar to other Argentine peers, the province has very high
infrastructure needs; therefore, increasing capex does not
translate into economic growth due to the important infrastructure
lag, which also reflects minimal flexibility to adjust capex.
Compared with international peers, Chaco has a high share of opex
to total expenditure, at around 89.3% during 2020. Staff expenses
represented 57.1% of total expenses (five year-average 55.9%),
deemed high relative to international peers.

Liabilities and Liquidity Robustness: 'Weaker'

Like other Argentine provinces, national rules on debt and
liquidity management have a weaker track record of enforcement
compared with regional peers, such as Brazil, Colombia or Mexico.
Limited local capital markets led LRGs to issue debt in foreign
currency, causing structural dependence in international markets
for financing, because local currency options generally carry
higher financial costs and shorter terms due to the high-inflation
environment. Additionally, financial obligations are characterized
by medium term maturity of less than 10 years.

Direct debt increased by 39.8% in 2020 underpinned by currency
depreciation, totaling ARS54.5 billion. As of 3Q21, the outstanding
amount stands at ARS60.0 billion; approximately 63.1% of Chaco's
direct debt is denominated in foreign currency and is unhedged,
mainly in U.S. dollars, which is a rating risk in the current
environment of high inflation and currency depreciation. However,
84.3% of its total debt has fixed interest rates. The external
market remains closed.

Capital market discipline is hindered by a protracted macroeconomic
downturn (recession, high inflation and sharp currency depreciation
in the past decade), and heightened by the sovereign's 'CCC'
macroeconomic environment, curtailing external market access to the
province. The context of national capital controls is an additional
weakness captured in this key risk factor (KRF), as the imposition
of exchange regulations could affect LRGs' abilities to fulfill
their financial obligations amid a macroeconomic downturn. Hence,
this is a material structural weakness considered in this KRF
assessment.

Chaco completed its DDE on June 25, 2021. The debt restructuring
provides some external debt service relief for the province until
2024, when repayments are due. One of the major achievements, among
others, was the reprofiling of its international financial debt and
step-up interest payments. However, despite this relief, the 'CCC'
IDRs reflect challenges ahead that could hinder the province's
repayment capacity, such as the province's inability to access
external markets to address financing needs.

The province is among the 13 provinces that did not transfer their
pension schemes to the nation, thus it is responsible for any
shortfall pension deficit funding, which represents an additional
expenditure burden and risk for its operating balance results, if
the annual arrangement, which is unpredictable and discretionary,
is not agreed with the national government. Under the current IMF
deal negotiations, Fitch will monitor any impact this deal could
have in this pension scheme. The unfunded pension deficit stresses
the operating balance; if Fitch adds this deficit, operating
balance shrinks to 11.2% from 16.9% in 2020.

Liabilities and Liquidity Flexibility: 'Weaker'

Fitch perceives the Argentine national framework in place for
liquidity support and funding available to subnationals as
'Weaker', as there are no formal emergency liquidity support or
bail-out mechanisms established. The national government can
support Chaco in the form of a friendly creditor, such as making
some programs and loans available to provinces from federal trust
funds, and through co-participation tax transfers advancements.
However, the macroeconomic environment constrains the
predictability, size and timing of this support. Impeding access to
liquidity from international market and concentration of
counterparty risk below 'BBB-' also drive the assessment of such
support to 'Weaker'.

Chaco received ARS5.3 billion (ARS2.8 billion from National
Treasury Grants -- ATN and ARS2.5 billion from Provincial
development Trust Fund -- FFDP) during 2020 from National Treasury
transfers (non-earmarked funds) under National Decree 352/20 for
the Provincial Emergency Financial Programme as a countercyclical
measure to contain economic impacts from the coronavirus.

Consolidated cash positions of ARS22.6 billion in 2020 covered
33.3% of annual personnel expenditures. However, for 2017-2019, the
entity showed weak and volatile liquidity coverage metrics (current
operating balance plus unrestricted cash from previous year to debt
service) averaging over the last five years 1.9x (2020: 4.0x).
Chaco didn't disclose its cash position for 3Q21. Fitch expects
total cash at YE 2021 to be around 22% of total revenue,
progressively shrinking to 17.1% towards 2023 due to outturns and
capex outlays increasing above inflation. The province has been
tapping the LC capital market issuing short term debt on a regular
basis. In 2020, the short-term debt program (Programa de Letras)
stood at ARS3.5 billion, ARS4.5 billion for 2021, and ARS5 billion
for 2022.

Debt sustainability: 'aa' category

Considering the current sovereign 'CCC' rating level, curtailment
of the external market amid a volatile macroeconomic and regulatory
context, Fitch is only projecting a rating case for YE2023. Debt
sustainability metrics are analyzed to evaluate Province of
Chaco-specific debt repayment capacity and its liquidity position
in this short rating case horizon.

Under Fitch's rating case scenario (2021 based on 3Q21
figures-2023), the debt payback ratio (net adjusted
debt-to-operating balance), the primary metric of debt
sustainability, will remain below 5.0x by 2023 (2020: 1.5x), which
corresponds to a 'aaa' assessment. In addition, actual debt service
coverage ratio (operating balance-to-debt service), secondary
metric of debt sustainability, at 2.1x in 2023 (3.6x in 2020),
leading to a 'aa' assessment, due to an override for a lower
secondary metric in comparison to the payback ratio category.

The overall debt sustainability score at 'aa' is underpinned by the
profile of the restructured USD note that starts amortizing in 2024
in tandem with better than expected operating margins and liquidity
metrics. The projected fiscal debt burden below 50% of operating
revenue also drives the score.

DERIVATION SUMMARY

Chaco's SCP is assessed at 'ccc', reflecting a combination of
vulnerable risk profile and debt sustainability in the 'aa'
category. In Fitch's view, there are no indications that a default
or a distressed debt exchange is likely to occur in the next 12
months. Additionally, in line with Fitch's methodology for SCP of
'ccc' or below, Fitch weighs quantitative and qualitative nuances
against national peers such as Salta.

The SCP also factors in international peer comparison, in
particular Ukrainian cities and Kaduna State. Fitch does not apply
any asymmetric risk or ad-hoc support from the central government
and assesses intergovernmental financing as neutral to the
province's ratings. Nevertheless, the province's IDRs reflect the
exposure to macroeconomic counterparty risks and unpredictable
regulatory framework that prevail in Argentina.

KEY ASSUMPTIONS

Qualitative Assumptions

-- Risk Profile: 'Vulnerable';

-- Revenue Robustness: 'Weaker';

-- Revenue Adjustability: 'Weaker';

-- Expenditure Sustainability: 'Weaker';

-- Expenditure Adjustability: 'Weaker';

-- Liabilities and Liquidity Robustness: 'Weaker';

-- Liabilities and Liquidity Flexibility: 'Weaker'.

Debt sustainability: 'aa' category, raised.

Quantitative Assumptions -- Issuer Specific.

In line with its LRG criteria, for an entity with base case
financial profile indicating an SCP of 'b' or below, the base case
analysis alone may be sufficient to evaluate the risk of default
and transition for the debt. Therefore, in the case of Chaco,
Fitch's base case is the rating case which already incorporates a
very stressful scenario. It is based on 2016-2020 figures and on
updated figures as of 3Q21.The key assumptions for the scenario
include:

-- Operating revenue average growth of 49.5% for 2021-2023;

-- Operating expenditure average growth of 63.9% for 2021-2023;

-- Average net capital balance of around minus ARS10.9 billion
    during 2021-2023;

-- Cost of debt considers non-cash debt movements due to currency
    depreciation with an average exchange rate of ARS95.3 per U.S.
    dollar for 2021, ARS143.8 per U.S. dollar for 2022, and
    ARS220.0 per U.S. dollar for 2023.

RATING SENSITIVITIES

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

-- If debt sustainability metrics remain in line with projections
    of a payback ratio below 5.0x and ADSCR above 1.0x; in tandem
    with a structural and sustainable liquidity coverage ratios,
    over the rating case horizon.

-- Assurance that uncertainties on budgetary policies will
    maintain positive operating margins and ADSCR above 1.0x.

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 next 12 months of the projected
    horizon, including evidence of increased refinancing risks
    underpinned by the inability to access the international
    capital market, and capital controls that hinder debt
    servicing of USD notes.

-- Policy or budgetary uncertainties that deteriorate operating
    margins and drive debt service coverage ratio below 1.0x;

-- Additional expenditure risks that increase volatility of
    operating balances and deteriorate ADSCR relative to Argentine
    LRG peers;

-- Any formal announcement by the province or its agent that is
    assessed as a DDE under Fitch's rating definitions.

BEST/WORST CASE RATING SCENARIO

International scale credit ratings of Sovereigns, Public Finance
and Infrastructure issuers have a best-case rating upgrade scenario
(defined as the 99th percentile of rating transitions, measured in
a positive direction) of three notches over a three-year rating
horizon; and a worst-case rating downgrade scenario (defined as the
99th percentile of rating transitions, measured in a negative
direction) of three notches over three years. The complete span of
best- and worst-case scenario credit ratings for all rating
categories ranges from 'AAA' to 'D'. Best- and worst-case scenario
credit ratings are based on historical performance.

ISSUER PROFILE

Chaco is located in the northeast region of Argentina and has a
small, low value-added economy. With an estimated population of
around 1.2 million, less than 3% of Argentina's population, GDP per
capita is estimated at USD4,579 in 2020 (below the national average
of USD8,409), and the poverty rate is at 53.6% (national average:
42.0%) as per 2020 figures. Services (tertiary) sector represents
65.5% of the province's gross domestic product, followed by
manufacturing and construction (secondary) sector at 24.2%, and the
agriculture, fishing and mining at 10.3. Cotton production is one
of the most important commodities, followed by sunflower seeds, and
soybean.

SUMMARY OF FINANCIAL ADJUSTMENTS

No material adjustments were made to figures reported by the
province.

ESG CONSIDERATIONS

Chaco, Province of has an ESG Relevance Score of '4' for Rule of
Law, Institutional & Regulatory Quality, Control of Corruption
reflecting the negative impact of a weak regulatory framework and
national policies have over the province, which has a negative
impact on the credit profile, and is relevant to the rating in
conjunction with other factors.

Chaco, Province of has an ESG Relevance Score of '4' for Creditor
Rights revised from '5', due to the entity´s improved willingness
to service and repay its debt obligations, which is relevant to the
current rating upgrade. The 2021 DDE continues to weigh on its
credit profile 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.


ENTRE RIOS: Fitch Raises LT Issuer Default Ratings to 'CCC-'
------------------------------------------------------------
Fitch Ratings has upgraded the province of Entre Rios, Argentina's
Long-Term Foreign and Local Currency Issuer Default Ratings (IDRs)
to 'CCC-' from 'CC'. Additionally, Fitch raised Entre Rios'
Standalone Credit Profile (SCP) to 'ccc-' from 'cc'.

The rating action reflects Entre Rios' improvement in its debt
sustainability score under Fitch's rating case (2022-2023),
underpinned by last year's distressed debt exchange (DDE) and the
pace of economic recovery in the country. Fitch expects the
province to present an adequate debt service coverage ratio over
the next 12-month period. The ratings also incorporate a 'CCC'
macroeconomic and regulatory environment that exposes Entre Rios to
a high volatile and less predictable institutional framework.

At YE 2021, the province's liquidity position rebounded notably
because of a fiscal surplus. Notwithstanding, refinancing risk
persists, given its exposure to heightening macroeconomic
uncertainties and staff expenditure pressure that could affect its
operating margins. The high pensions burden could also impair
liquidity metrics.

KEY RATING DRIVERS

Risk Profile: 'Vulnerable'

Entre Rios ' risk profile of 'Vulnerable' is based on Weaker
attributes on the six key risk factors with a sovereign rated below
the 'B' category.

The assessment reflects Fitch's view of a very high risk relative
to international peers that the issuer's ability to cover debt
service with the operating balance may weaken unexpectedly over the
forecast horizon (2022-2023) due to lower revenue, higher
expenditure, or an unexpected rise in liabilities or debt or
debt-service requirement.

Revenue Robustness: 'Weaker'

Entre Rios' revenue robustness assessed as 'weaker' reflects its
high dependence on federal transfers, which have represented around
68.5% (average in 2017-2021) of its operating revenues. These
federal transfers are automatic from the co-participation
tax-sharing regime, which stem from a 'CCC' rated sovereign
counterparty. The latter is compounded by the country's modest
economic growth prospects. The national GDP dropped around 2% in
2018 and 2019 and plummeted by 9.9% in 2020 due to the pandemic, in
real terms. By 2021 the national GDP recovered and grew by 10.3%.
Weak and volatile national economic performance is factored into
the revenue robustness assessment.

Argentina's future economic prospects are uncertain until it
finalizes an IMF deal. Therefore, predictability of non-mandatory
transfers is clouded, especially the re-taking of additional fiscal
consolidation agreements, new fiscal reform initiatives, or changes
to the national subsidies scheme where provinces could be
negatively impacted from larger expenditure responsibilities.

Revenue Adjustability: 'Weaker'

Local revenue adjustability is low and is challenged by the
country's large and distortive tax burden. The negative
macroeconomic environment further limits the province's ability to
increase tax rates and expand tax bases to boost its local
operating revenues. Structural high inflation also constantly
erodes real-term revenue growth and affects affordability.

Provincial jurisdictions have legal autonomy to set tax rates. Tax
collection accounted for 24.6% of total consolidated provincial
revenues in 2021, reflecting low fiscal autonomy and reliance on
federal transfers from the co-participation regime. Although in
2021 Entre Rios' tax collection increased above inflation (+15%
yoy), the proportion with respect to total revenues remained steady
(averaging 24% in 2019-2021).

Expenditure Sustainability: 'Weaker'

Argentine provinces have high expenditure responsibilities, and the
country's fiscal regime is structurally imbalanced regarding
revenue-expenditure decentralization. This is further exacerbated
by the high inflationary operating environment, which weakens Entre
Rios' control over total expenditure growth prospects. Argentine
provinces have high expenditure responsibilities, including
healthcare, education, water, transportation and other services.

Since the nation's standby agreement with the IMF in 2018, the
federal government transferred some additional expenditure
responsibilities to the provinces by cutting down current and
capital transfers, as well as subsidies in the inter-provincial
transport services and electricity sector (social tariffs). In
Fitch's view, spending decentralization could continue to rise in
the current negotiation with the IMF. Fitch will monitor how this
agreement unfolds and impacts the provinces' fiscal framework.

In 2020 and 2021 the province significantly contained its operating
expenditure (opex), which resulted in growing operating margins.
Fitch believes this trend is unsustainable due to high expenditure
needs in healthcare, social, justice and public services and due to
the lag effect that inflation tends to have on real-term wages and
pension obligations. From 2022 Fitch estimates opex will increase
above inflation and will lower the operating balance to 8.1% in
2023.

Entre Rios is among the provinces that did not transfer their
pension scheme to the nation. It is responsible for any shortfall
pension deficit funding that represents an additional expenditure
burden and risk for its operating balance results. When considering
the weight of the pension deficit the operating margin dropped to
12.7% from 21.6% in 2021. Entre Rios has had to cover more than 50%
of the deficit of the social security system. Therefore, budgetary
risks remain and could increase if the nation reduces its support
to cover the rest of the deficit after the current IMF deal
negotiations, weakening expenditure predictability.

Expenditure Adjustability: 'Weaker'

Entre Rios' weight of staff expenses in its opex structure is high
relative to international peers at 64.4% in 2021, with opex
totaling around 88.8% of total expenditure. Staff expenses
represented a rigid 56.8% of total expenses on average during
2017-2021, limiting the province's budgetary flexibility.

The province's leeway or flexibility to cut expenses is viewed as
weak relative to international peers, considering that only a low
2017-2021 average 6.5% of the province's total expenditure
corresponds to capex. Entre Rios reported CAPEX at 5.2% of total
expenditures in 2020, compared to an 6.6% average in 2016-2019. In
2021, capex ratio improved and was equal to 7.5%. Similar to other
Argentine peers, the province has very high infrastructure needs.
Due to the high level of infrastructure needs, increasing capex
does not translate into economic growth due to infrastructure lags,
which also reflects that there is not much flexibility to adjust
capex.

Liabilities and Liquidity Robustness: 'Weaker'

Capital market discipline is currently heightened by a 'CCC' rated
sovereign, thus curtailing external market access to LRGs. Unhedged
foreign currency debt exposure is an important structural weakness
considered in this assessment, along with the weak national
framework for debt and liquidity and underdeveloped local market.
The context of national capital controls is an additional weakness,
as the imposition of exchange regulations could affect LRGs'
abilities to fulfill their financial obligations amid a
macroeconomic downturn. Hence, this is a material structural
weakness.

On March 15, 2021 Entre Rios restructured its foreign currency
notes after a distressed debt exchange (DDE) process. At YE2021
direct debt totaled ARS97.2 billion, with 77.3% denominated in
foreign currency; total debt grew around 22% relative to 2020
mainly due to currency depreciation. Entre Rios has not taken
short-term treasury bills. Entre Rios' fiscal burden ratio was of
27.4% at YE 2021 triggered by a considerable improvement of
unrestricted cash. For the immediate 12 months the refinancing
likelihood is much lower because the USD notes are still within the
grace period. However, the province's debt capital maturities
beginning in February 2023 could pressure the entity's debt service
coverage levels, which Fitch projects will hover slightly above 1x
in 2023.

Liabilities and Liquidity Flexibility: 'Weaker'

Argentine provinces rely mainly on their own unrestricted cash for
liquidity. Fitch views the national framework in place regarding
liquidity support and funding available to subnationals as weak,
because there are no emergency-support liquidity mechanisms and the
sovereign's external market access affects the entity's refinancing
capacity. At YE 2021 Entre Rios' unrestricted cash totaled ARS31.1
billion with a liquidity coverage ratio higher than 1x reflecting
an adequate liquidity position relative to its overall debt
servicing. The Argentine government's 'CCC' ratings also drive the
assessment of this support to 'Weaker', considering counterparty
risk.

Debt sustainability: 'aa' category

Considering the current 'CCC' sovereign rating and curtailment of
the external market amid a volatile macroeconomic and regulatory
context, Fitch is only projecting a rating case for YE2023. Fitch
analyzed debt sustainability metrics to evaluate Entre
Rios-specific debt repayment capacity and its liquidity position in
this short rating case horizon.

Under Fitch's rating case scenario (2022-2023), the debt payback
ratio (net adjusted debt-to-operating balance), the primary metric
of debt sustainability, will remain below 5x with a score of 'aaa'.
The actual debt service coverage ratio (operating balance to debt
service, ADSCR) is projected slightly above 1x in 2023 when USD
notes principal repayment begins, a 'bb' score, resulting on a
final 'aa' debt sustainability assessment due to an override of the
weaker coverage level.

The overall debt sustainability score of 'aa' is underpinned by the
profile of the restructured USD notes that starts amortizing in
2023 in tandem with better than expected operating margins and
liquidity metrics.

DERIVATION SUMMARY

Entre Rios' standalone credit profile (SCP) is assessed at 'ccc-',
reflecting a combination of vulnerable risk profile and debt
sustainability in the 'aa' category. The SCP of 'ccc' reflects debt
service coverage ratio close to 2x in 2022 and slightly above 1x in
2023 when the USD notes principal repayment begins, and considers a
comparison with peers, including the Provinces of Chaco and La
Rioja. Entre Rios is currently meeting its debt service
obligations, and debt distress does not appear probable in the
following 12-months. The province's IDRs reflect the exposure to
macroeconomic counterparty risks and unpredictable regulatory
framework that prevail in Argentina.

Fitch does not apply any asymmetric risks or extraordinary support
from upper-tier government, which leads to FC and LC IDRs of
'CCC-'.

KEY ASSUMPTIONS

Qualitative assumptions:

-- Risk Profile: Vulnerable

-- Revenue Robustness: Weaker

-- Revenue Adjustability: Weaker

-- Expenditure Sustainability: Weaker

-- Expenditure Adjustability: Weaker

-- Liabilities and Liquidity Robustness: Weaker

-- Liabilities and Liquidity Flexibility: Weaker

-- Debt sustainability: 'aa' category, raised

-- Budget Loans or Ad-Hoc Support: n/a

-- Asymmetric Risk: n/a

-- Rating Cap or Rating Floor: n/a

Quantitative assumptions - issuer specific

In line with its LRG criteria, for an entity with base case
financial profile indicating an SCP of 'b' or below, the base case
analysis alone may be sufficient to evaluate the risk of default
and transition for the debt. Therefore, in the case of Entre Rios,
Fitch's base case is the rating case which already incorporates a
very stressful scenario. It is based on 2017-2021 figures. The key
assumptions for the scenario include:

-- yoy 52.2% increase in operating revenue on average in 2022-
    2023;

-- yoy 64.3% increase in operating spending on average in 2022-
    2023;

-- net capital balance of negative ARS 25.3 billion on average in
    2022-2023;

-- cost of debt: 7.4% (2022) and 8.1% (2023);

-- cost of debt considers non-cash debt movements due to currency
    depreciation, assuming an exchange rate (ARS per USD) of 139.5
    for 2022, 205.3 in 2023.

RATING SENSITIVITIES

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

-- If debt sustainability metrics remain in line with projections
    of a payback ratio below 5x and ADSCR above 1.0x in tandem
    with a structural and sustainable liquidity coverage ratio
    over the rating case horizon. (The latter could be caused by
    more expenditure predictability related to an unfunded pension
    deficit.)

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 next 12 months of the projected
    horizon, including evidence of increased refinancing risks
    underpinned by the inability to access the international
    capital market, and capital controls that hinder debt
    servicing of USD notes.

-- Any formal announcement by the province or its agent that is
    assessed as a DDE under Fitch's rating definitions.

BEST/WORST CASE RATING SCENARIO

International scale credit ratings of Sovereigns, Public Finance
and Infrastructure issuers have a best-case rating upgrade scenario
(defined as the 99th percentile of rating transitions, measured in
a positive direction) of three notches over a three-year rating
horizon; and a worst-case rating downgrade scenario (defined as the
99th percentile of rating transitions, measured in a negative
direction) of three notches over three years. The complete span of
best- and worst-case scenario credit ratings for all rating
categories ranges from 'AAA' to 'D'. Best- and worst-case scenario
credit ratings are based on historical performance.

ISSUER PROFILE

The Province of Entre Rios has an exceptional geographic location
and endowment of natural resources. It is located in the northeast
region of Argentina, the heart of Mercosur. Entre Rios is adjacent
to the Province of Buenos Aires, the main market of production and
consumption in Argentina. Its territory is suitable for livestock,
while 53% of the province's surface is suitable for agricultural
activity and agribusiness, which represent the core of the
productive and export structure. Entre Rios exports mainly to Asia.
In 2018, 55.6% of exports was concentrated in the primary sector,
36.2% was in agribusiness, and the remaining 8.2% was in
industrials.

SUMMARY OF FINANCIAL ADJUSTMENTS

No material adjustments were made to figures reported by the
province.

ESG CONSIDERATIONS

Entre Rios, Province of has an ESG Relevance Score of '4' for Rule
of Law, Institutional & Regulatory Quality, Control of Corruption
due to it presents weak management practices and regulations toward
its financial obligations. This has a negative impact on the credit
profile and is relevant to the ratings in conjunction with other
factors.

Fitch has revised Entre Rios' ESG Score for Creditor Rights to '4'
from '5' given the entity's improved willingness to service and
repay its debt obligations, which is relevant to the recommended
rating upgrade. The 2021 DDE continues to weigh on its credit
profile. Fitch expects that fiscal challenges at the national and
local level will continue to hinder the province's ability to repay
its debt obligations. This has a negative impact on 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.


SALTA: Fitch Raises LT Issuer Default Ratings to 'CCC'
------------------------------------------------------
Fitch Ratings has upgraded the Province of Salta's Long-Term
Foreign and Local Currency Issuer Default Ratings (IDRs) to 'CCC'
from 'CC'. Salta's stand-alone credit profile (SCP) was raised to
'ccc' from 'cc'. Salta's amended US$357.4 million senior unsecured
step-up notes due in 2027 and US$185 million senior secured 9.5%
notes due in 2022 were upgraded to 'CCC' from 'CC', at the same
level as the province's IDRs.

The upgrade reflects Salta's improved operating balance, cash
availability and debt sustainability score under Fitch's rating
case (2021-2023), underpinned by last year's distressed debt
exchange (DDE), as well as the pace of economic recovery in
Argentina. Additionally, the ratings considers a 'CCC'
macroeconomic and regulatory environment that exposes Salta to a
highly volatile and less predictable institutional framework.

KEY RATING DRIVERS

Risk Profile: 'Vulnerable'

Salta's 'Vulnerable' risk profile is based on 'Weaker' attributes
on the six key risk factors with a sovereign rated below the 'B'
category. The assessment reflects Fitch's view of a very high risk
relative to international peers that the issuer's ability to cover
debt service with the operating balance may weaken unexpectedly
over the forecast horizon (2021-2023). This is due to lower
revenue, higher expenditure, or an unexpected rise in liabilities
or debt or debt-service requirement.

Revenue Robustness: 'Weaker'

Salta's revenue robustness assessed as 'Weaker' reflects its high
dependence on federal transfers, which account for 74.4% (average
for 2016:2020) of its operating revenues. These federal transfers
are automatic from the co-participation tax-sharing regime, which
stem from a 'CCC' rated sovereign counterparty. The latter is
compounded by the country's modest economic growth prospects.

The national GDP dropped 2.6% in 2018, a further 2.1% in 2019, and
9.9% in 2020 due to the pandemic, in real terms. Preliminary data
indicates a 10.3% positive GDP growth in 2021. Weak and volatile
national economic performance is factored into the revenue
robustness KRF assessment.

Revenue Adjustability: 'Weaker'

Fitch believes that local revenue adjustability is low, and
challenged by the country's large and distortive tax burden. The
weak macroeconomic environment also limits Local and Regional
Governments' (LRGs) ability to increase tax rates and expand tax
bases to boost their local operating revenues. Structurally high
inflation also constantly erodes real-term revenue growth and
affects affordability.

Provincial jurisdictions have legal autonomy to set tax rates on
local revenues that mainly consist on turnover taxes (Ingresos
Brutos) and stamps. Local taxes represented 21% of total
consolidated provincial revenues on average in 2020, reflecting low
fiscal autonomy and reliance on federal transfers from the
co-participation regime.

Expenditure Sustainability: 'Weaker'

Argentine provinces have high expenditure responsibilities,
including healthcare, education, water, transportation and other
services. The country's fiscal regime is structurally imbalanced
regarding revenue-expenditure decentralization. This is further
exacerbated by the high inflationary environment, which weakens the
province's control over total expenditure growth.

Since the nation's standby agreement with the IMF in 2018, the
federal government transferred some additional expenditure
responsibilities to the provinces by cutting down current and
capital transfers, as well as subsidies in the inter-provincial
transport services and electricity sector (social tariffs). Fitch
believes spending decentralization could continue to rise in the
current negotiation with the IMF. Fitch will monitor this agreement
as it unfolds, and how it impact the provinces' fiscal framework.

Salta reversed its operating margins from negative to positive
territory, with margins of 11.8% in 2018, 5.2% in 2019 and 4.8% in
2020. Based on data available until November 2021, Fitch expects
more stable operating margins, reaching 7.3% in 2021, followed by
some moderation towards the end of the projection horizon, with
margins at 5.9% by 2023.

Salta is among the provinces that transferred its pension system to
the national government and, therefore, is not pressured by pension
deficits.

Expenditure Adjustability: 'Weaker'

Fitch views leeway or flexibility to cut expenses for Argentine
LRGs as weak relative to international peers, considering an
average of around 9.7% of consolidated provincial total
expenditures corresponded to capex in 2020, down from 14.8% in
2018. The province reported capex at 4% of total expenditures in
2020, compared to an 8.6% average for 2016:2019.

Salta's payroll bill is high at 60.6% of total expenditures in
2020, among the highest for Argentine LRGs, limiting the provinces
budgetary flexibility.

Liabilities and Liquidity Robustness: 'Weaker'

Capital market discipline is currently heightened by a 'CCC' rated
sovereign, thus curtailing external market access to LRGs. Unhedged
foreign currency debt exposure is an important structural weakness
considered in this KRF assessment, along with the weak national
framework for debt and liquidity and underdeveloped local market.

National capital controls is an additional weakness captured in
this KRF, as the imposition of exchange regulations could affect
the LRGs' abilities to fulfill their financial obligations amid a
macroeconomic downturn. Hence, this is a material structural
weakness considered in this KRF assessment. The province's 2020
default of its senior unsecured notes and DDE of February 2021 also
weigh on the 'Weaker' assessment.

Liabilities and Liquidity Flexibility: 'Weaker'

For liquidity, Argentine provinces rely mainly on their own
unrestricted cash. Fitch believes the national framework in place
regarding liquidity support and funding available to subnationals
is weak, as there are no emergency-support liquidity mechanisms,
and considering that the sovereign's external market access affects
the entity's refinancing capacity. Fitch estimates the province's
liquidity coverage ratio at 1.2x by YE 2020 and 2.2x by the YE
2021.

Debt Sustainability: 'aa' Category

Considering the current sovereign 'CCC' rating level, curtailment
of the external market amid a volatile macroeconomic and regulatory
context, under its rating case, Fitch principally focus on the
2022-2023 period. Debt sustainability metrics are analyzed to
evaluate the province's specific debt repayment capacity and
liquidity position in this short rating case horizon. Inflation is
projected in the 52%-55% range for 2022:2023.

Under Fitch's rating case scenario (2021-2023) the primary metric
of payback burden (net adjusted debt to operating balance) will be
below 5x with a score of 'aaa'. The actual debt service coverage
ratio (operating balance to debt service, ADSCR) is projected
slightly above 1.0x, a 'bb' score, resulting in a final 'aa' debt
sustainability assessment, due to an override of the weaker
coverage level.

DERIVATION SUMMARY

Fitch relies on its rating definitions and LRG criteria to position
the Province of Salta. Salta has a 'Vulnerable' risk profile and a
'aa' debt sustainability assessment. The 'ccc' SCP reflects debt
service coverage ratio close to 1x in the next two years
(2022:2023), and considers comparisons with peers, including the
Province of Chaco. Salta is currently performing its debt service
obligations, and debt distress does not appear probable in the
following 12-months. The province's IDRs reflect the exposure to
macroeconomic counterparty risks and unpredictable regulatory
framework in Argentina.

Fitch does not apply any asymmetric risks or extraordinary support
from upper-tier government, which results in a Long-Term Foreign-
and Local-Currency IDR of 'CCC'.

The province's senior secured and senior unsecured notes are
positioned at the same level as its 'CCC' IDRs.

KEY ASSUMPTIONS

Qualitative assumptions:

-- Risk Profile: 'Vulnerable'

-- Revenue Robustness: 'Weaker'

-- Revenue Adjustability: 'Weaker'

-- Expenditure Sustainability: 'Weaker'

-- Expenditure Adjustability: 'Weaker'

-- Liabilities and Liquidity Robustness: 'Weaker'

-- Liabilities and Liquidity Flexibility: 'Weaker'

-- Debt sustainability: 'aa' category

-- Budget Loans or Ad-Hoc Support: n/a

-- Asymmetric Risk: n/a

-- Rating Cap or Rating Floor: n/a

Quantitative assumptions - issuer specific

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 2016-2020 figures and 2021-2023
projected ratios. The key assumptions for the scenario include:

-- yoy 56.1% increase in operating revenue on average in 2021-
    2023

-- yoy 56.5% increase in operating spending on average in 2021-
    2023

-- net capital balance of negative ARS 6.9 billion on average in
    2021-2023

-- cost of debt: 9.5% (2021); 11.4% (2022) and 9.9% (2023)

RATING SENSITIVITIES

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

-- If debt sustainability metrics remain in line with projections
    of a payback below 5x and ADSCR above 1x; in tandem with
    structural and sustainable liquidity metrics under a scenario
    of less uncertainty, over the rating case horizon.

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

-- Additional expenditure risks that increase volatility of
    operating balances and deteriorates ADSCR in comparison to
    Argentine LRG peers;

-- Signs of deeper liquidity stress that could compromise debt
    repayment capacity in the next 12 months of the projected
    horizon, including evidence of increased refinancing risks
    underpinned by the inability to access the international
    capital market, and capital controls that hinder debt
    servicing of USD notes;

-- Any formal announcement by the province or its agent that is
    assessed as a DDE under Fitch's rating definitions.

BEST/WORST CASE RATING SCENARIO

International scale credit ratings of Sovereigns, Public Finance
and Infrastructure issuers have a best-case rating upgrade scenario
(defined as the 99th percentile of rating transitions, measured in
a positive direction) of three notches over a three-year rating
horizon; and a worst-case rating downgrade scenario (defined as the
99th percentile of rating transitions, measured in a negative
direction) of three notches over three years. The complete span of
best- and worst-case scenario credit ratings for all rating
categories ranges from 'AAA' to 'D'. Best- and worst-case scenario
credit ratings are based on historical performance.

ISSUER PROFILE

The Province of Salta is located in northwest Argentina. It has a
small and weak local economy concentrated in the tertiary sector,
heavily weighted in social services and the public sector. The
primary sector also contributes, and includes hydrocarbon
extraction. Salta has a low GDP per capita and a higher than
average percentage of the population with unsatisfied basic needs,
which translates into structurally high infrastructure needs.
Salta's economy corresponded to around 1.5% of national GDP, which
is equivalent to ARS 406.7 billion in 2020. The province's
population is estimated at 1.4 million or 3.1% of the national
population.

ESG CONSIDERATIONS

Salta has an ESG relevance score of '4' for Rule of Law,
Institutional & Regulatory Quality, Control of Corruption as it
presents weak management practices and regulations toward its
financial obligations, which has a negative impact on the credit
profile, and is relevant to the ratings in conjunction with other
factors.

Salta has an ESG Score of '4' for Creditor Rights revised from '5'
given the entity´s improved willingness to service and repay its
debt obligations, which is relevant to current rating upgrade. The
2021 DDE continues to weigh on its 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 E L I Z E
===========

BELIZE: Pandemic Has Had a Severe Impact on Country, IMF Says
-------------------------------------------------------------
The International Monetary Fund (IMF) issued a Concluding Statement
of the 2022 Article IV Mission on Belize in February 2022.  An IMF
team led by Jaime Guajardo conducted discussions for the 2022
Article IV consultation with Belize between February 10 and 22.
The team met with the Honorable Mr. John Briceno, Prime Minister;
Mr. Kareem Michael, Governor of the Central Bank of Belize; Mr.
Christopher Coye, Minister of State; Mr. Joseph Waight, Financial
Secretary; and other senior government officials, representatives
of the opposition, private sector, and public sector unions.

Context

The COVID-19 pandemic has had a severe impact on Belize:  It led to
a 71 percent fall in tourist arrivals and a 16.7 percent
contraction in real GDP in 2020. The resulting fall in fiscal
revenues and rise in pandemic-related expenditure widened the
fiscal deficit and increased public debt to 133 percent of GDP in
2020, a level that was assessed as unsustainable in the 2021
Article IV consultation. To address this situation, the government
presented a Medium-Term Recovery Plan (MTRP) in April 2021, which
seeks to reduce public debt to 85 percent of GDP in 2025 and 70
percent in 2030 through the implementation of fiscal consolidation,
growth-enhancing structural reforms, and debt restructuring.

Significant progress towards restoring debt sustainability was made
in 2021:  In line with the MTRP, the FY2021 budget introduced
sizable fiscal consolidation measures, including cuts to public
sector wages and purchases of goods and services, which are
projected to reduce government expenditure by 3.4 percent of GDP in
FY2021. Belize also completed a debt for marine protection swap,
under which a subsidiary of The Nature Conservancy lent funds to
Belize to buy back the superbond (totaling US$553 million or 30
percent of GDP) at a discounted price of 55 cents per dollar. In
exchange, Belize committed to increase expenditure on marine
conservation until 2041 and expand its Biodiversity Protection
Zones (coral reefs, mangroves, and fish spawning sites) from 16
percent of ocean area to 30 percent by 2026. This operation reduced
Belize's public debt by 12 percent of GDP in 2021.

Recent Developments, Outlook, and Risks

Economic activity is recovering strongly:  Real GDP is projected to
grow by 12.5 percent in 2021 and 6.5 percent in 2022, led by a
rebound of activity in the construction, retail and wholesale
trade, transport and communication, and tourism sectors. The
unemployment rate also declined from 13.7 percent in the second
half of 2020 to 9.2 percent in the second half of 2021. End of year
inflation rose to 4.9 percent in 2021 driven by higher
international energy and food prices but is projected to moderate
to 3.5 percent in 2022 and 2 percent over the medium term as
commodity prices stabilize.

The fiscal position has strengthened in line with the economic
recovery and the fiscal consolidation measures implemented in
FY2021:  The primary fiscal balance is projected to increase from
-8.5 percent of GDP in FY2020 to 1.5 percent of GDP in FY2021,
driven by a rise in revenues, a fall in current expenditure due to
the consolidation measures implemented in FY2021, and lower capital
expenditure. Going forward, the primary surplus is projected to
stabilize at 0.7 percent of GDP assuming that the fiscal savings
achieved in FY2021 are preserved over time and no additional
measures are implemented during FY2022-32.

Debt dynamics have improved, but public debt would continue to be
assessed as unsustainable in the absence of additional measures:
Public debt declined from 133 percent of GDP in 2020 to 108 percent
in 2021 and is projected to decline further to 84 percent of GDP by
2032 due to the continued primary surpluses. However, public debt
would continue to be assessed as unsustainable in the absence of
additional measures as it would remain above typical thresholds for
sustainability over the next decade.

The external position strengthened in 2021 but is projected to
weaken over the medium term:
International reserves increased from US$348 million (3.8 months
of imports) in 2020 to US$420 million (3.9 months of imports) in
2021, partly due to the IMF's SDR25.6 million allocation, which the
authorities are keeping as reserves. Going forward, external
financing is expected to become scarcer due to debt sustainability
concerns, which would worsen reserve adequacy over time.

Risks to the outlook are substantial and tilted to the downside:  A
key risk is an escalation of the pandemic, including through the
emergence of new vaccine resistant variants that could derail the
recovery of tourism. On the upside, further vaccination may
strengthen immunity and growth. Another key risk is a sudden
tightening of global financial conditions leading to higher cost of
external financing. Natural disasters are also a key risk given
Belize's high vulnerability to weather shocks and climate change.
Inflation could rise further because of second round effects and
higher international energy and food prices.

Policies to restore debt sustainability and strengthen the currency
peg

Belize's key policy priorities continue to be restoring debt
sustainability and strengthening the currency peg. This requires
ensuring that the recent improvements in the fiscal position are
preserved over time and implementing additional fiscal
consolidation and growth-enhancing structural reforms , with the
objective of reducing public debt to 60 percent of GDP by 2031.

A. Sustained Fiscal Consolidation

The authorities should capitalize on the recent decline in public
debt and continue their efforts to reduce it further . Staff
recommends reducing public debt to 60 percent of GDP by 2031-a
slightly more ambitious target than the one in the MTRP-to ensure
that it stays below the 70 percent of GDP threshold for
sustainability even when the economy is hit by shocks. Reaching
this target will require raising the primary balance to 3.5 percent
of GDP by FY2024, in line with the plans in the FY2021 budget
speech, by preserving the recent decline in the fiscal deficit and
implementing 2.8 percent of GDP of additional fiscal consolidation
measures over three years. Anchoring this plan in a credible
medium-term fiscal strategy with clear targets and specific
measures and preparing the ground for the adoption of a
well-designed Fiscal Responsibility Law (FRL) would enhance the
credibility of this strategy.

Additional fiscal consolidation should rely on both revenue and
expenditure measures:  Following the implementation of an
expenditure-based fiscal consolidation package in FY2021, the
authorities should consider a more balanced composition going
forward, including both expenditure rationalization and revenue
mobilization as follows:

  * Expenditure:  Given the increase in inflation and the fall in
real wages and real purchases of goods and services, the
authorities should consider increasing noninterest current
expenditure in line with inflation between FY2022 and FY2024, which
would reduce the fiscal deficit by 1.8 percent of GDP by FY2024.
The authorities should also consider gradually raising social
expenditure (healthcare, education, and targeted social programs)
by 1 percent of GDP over four years and creating a natural disaster
contingency fund with adequate safeguards of 1 percent of GDP over
four years in line with the advice in the 2018 Climate Change
Policy Assessment (CCPA).

  * Revenue:  Broadening the tax base and strengthening tax
administration can increase revenues significantly: (i) broadening
the general sales tax (GST) base by taxing some of non-necessity
zero-rated items at the standard 12.5 percent rate and bringing the
hotel sector into the GST could raise 1.5 percent of GDP in revenue
by FY2024; (ii) lowering the PIT exemption threshold and taxing
some exempted sources of income could raise 0.2 percent of GDP;
(iii) increasing excise taxes and fees on vehicle registrations and
driver licenses could raise by 0.1 percent of GDP; and (iv)
strengthening customs and tax administration could raise 0.2
percent of GDP.

The authorities should prepare contingency plans in case public
debt does not fall as planned . Implementing additional fiscal
consolidation will be difficult given limited capacity and
political pressures. Moreover, the required adjustment could be
larger if revenues fall, some measures adopted in 2021 are
reversed, or the economy is hit by adverse shocks. In this context,
it will be important to prepare a menu of contingency measures,
including raising the GST rate, broadening the tax base, taxing
property and capital gains, cutting nonpriority expenditure, and
restructuring public debt.

Efforts to modernize Public Financial Management (PFM) systems and
procedures should continue:  The authorities are implementing
initiatives to strengthen public expenditure management, including
on cash management, public debt, internal audit, and technology.
They are also enhancing procurement to promote economies of scale
and competitiveness among suppliers in the acquisition of all goods
and services. Additional PFM areas that should be strengthened
going forward include multi-year budget preparations, fiscal risk
assessment, public investment management, coverage of government
accounts, and accounting and fiscal reporting. Progress in these
areas would facilitate future implementation of an FRL with
explicit fiscal rules to strengthen the commitment to fiscal
discipline.

B. Growth-Enhancing Structural Reforms

Belize also needs to continue implementing growth-enhancing
structural reforms:  Boosting growth through reforms that improve
the business environment would reduce the amount of fiscal
consolidation needed to restore debt sustainability. The
authorities have streamlined the processes and reduced the time
required to register property and new businesses. Improving the
business environment further requires easing access to credit for
SMEs through the launch of the credit bureau and collateral
registry, reducing entry barriers for businesses, enhancing human
capital, upgrading infrastructure, and containing crime. Advancing
this agenda will require reprioritizing public expenditure.

The authorities have an ambitious climate change mitigation and
adaptation agenda, but financing remains elusive:  Belize's updated
Nationally Determined Contribution (NDC) presents the country's
ambitious plans on mitigation and adaptation for 2021-30, including
protecting and restoring natural habitats, expanding the use of
renewable energy, using drought tolerant crops, and enhancing
infrastructure. The updated NDC also presents the estimated costs
and financing gaps, which are significant, especially for
mitigation.

Adoption of a Disaster Resilience Strategy (DRS) would enhance
access to financing:  Belize should continue seeking funding for
its mitigation and adaptation plans from multilateral creditors,
the Green Climate Fund, and The Conservation Fund. Access to
financing would be enhanced with the adoption of a DRS that focuses
on improving structural, financial, and post-disaster resilience,
and is based on a consistent multi-year macro-fiscal framework.

Financial and post disaster resilience should be strengthened as
advised in the 2018 CCPA:  Belize has continued strengthening
structural resilience by upgrading its infrastructure and restoring
natural habitats, but there has been less progress strengthening
financial and post disaster resilience due to the country's limited
fiscal space. While legislation creating a natural disaster
contingency fund for frequent low severity events has been passed,
no funds have been allocated to it. The government has a contingent
credit line with the IDB to cover losses from more severe events,
but it is insufficient. Belize needs to expand the coverage of
insurance and other contingent financing, and reform social
protection to scale up quickly after a disaster. Advancing this
agenda will also require reprioritizing expenditure.

C. Monetary and Financial Policies

Although Belize's external position strengthened in 2021, it
remains weaker than justified by medium-term fundamentals and
desirable policies . International reserve adequacy is projected to
weaken over the medium term due to concerns about debt
sustainability. Moreover, the External Balance Assessment indicates
that the current account deficit is larger than its estimated
equilibrium level.

In the absence of exchange rate flexibility, reducing external
imbalances requires restoring debt sustainability . The authorities
and staff consider the currency peg as a key macroeconomic anchor
that should be preserved. In this context, reducing external
imbalances requires restoring debt sustainability by implementing
additional fiscal consolidation and growth-enhancing structural
reforms, which would also lower the current account deficit,
enhance access to external financing, improve reserve adequacy, and
strengthen the currency peg. The latter also requires limiting
government financing by the Central Bank, in line with the trends
in 2021.

Domestic banks remain well capitalized and with low nonperforming
loans (NPLs), but this could change as the expiration of the
forbearance measures introduced in 2020 begins to impact their
balance sheets . Regulatory capital remains well above minimum
requirements, while NPLs remain manageable at 5.3 percent of loans.
However, this partly reflects forbearance measures introduced in
2020. As these measures have now expired, the Central Bank has
requested domestic banks and credit unions to self-assess their
loan portfolio by end-February 2022. The Central Bank will review
these self-assessments and agree on a plan going forward with each
institution. In this context, it will be important that any agreed
exceptional measures are time-bound and targeted, and financial
institutions resume the regular classification and restructuring
procedures as soon as possible. To support these efforts, the
government increased the Central Bank's capital by more than 0.5
percent of GDP in FY2021 despite its tight budget constraint.
Efforts to strengthen enforcement of AML/CFT requirements on banks
should continue.

The authorities must continue strengthening the AML/CFT framework
and its implementation, especially in the international financial
services (IFS) sector . The authorities have finalized their first
national assessment of money laundering and terrorist financing
(ML/TF) risks and have developed an action plan to strengthen their
AML/CFT framework. They intend to update both in the coming months
to strengthen ML/TF risks mitigation and be better prepared for the
2023 mutual evaluation by the Caribbean Financial Action Task
Force. Policy priorities include: (i) centralizing information on
beneficial ownership so that accurate and up-to-date data is easily
accessible under the new legal framework for domestic and
international corporations; (ii) deepening the understanding of the
ML/TF risks inherent to the sector; (iii) increasing the resources
and capacity of the Financial Services Commission (FSC); and (iv)
introducing legal reforms to implement AML/CFT standards on virtual
assets and virtual asset service providers.




=============
B O L I V I A
=============

BOLIVIA: S&P Assigns 'B+' Rating on US$850MM Sr. Unsecured Notes
----------------------------------------------------------------
S&P Global Ratings assigned its 'B+' issue rating to Bolivia's
US$850 million senior unsecured notes. The 7.5% notes will mature
in 2030.

The rating on the notes is the same as the long-term foreign
currency sovereign credit rating on Bolivia.

The bulk of the issuance will be used for liability management
transactions. Nearly 90% of the outstanding amount of the notes due
2022 was tendered, reducing the sovereign's October 2022
amortization payment to $56 million, from $500 million originally.
Before the operation, the 2022 bond represented nearly 40% of
current year amortizations and the only commercial international
maturity. That said, the sovereign's financing needs remain
substantial in the coming years as the government is likely to
undertake a gradual fiscal correction from recent high deficits.

S&P's 'B+' ratings on Bolivia capture increasing vulnerabilities
from persistent and sizable fiscal deficits and a deterioration of
the country's external profile, weak political institutions, and
limited monetary policy flexibility arising from exchange-rate
rigidities. The ratings also reflect a track record of low
inflation, a low level of dollarization in the financial system,
and manageable debt service in the next two years.

The negative outlook indicates the possibility of a downgrade over
the coming six to 12 months due to vulnerabilities stemming from a
potential weakening of the sovereign's finances because of a higher
interest burden and the risk of poorer-than-expected external
balances.




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

AZUL AIRLINES: Assures Recovery in Total Demand in 2022
-------------------------------------------------------
Rio Times Online reports that Brazilian airline Azul reduced its
losses by 53% from BRL10.422 billion (about US$2.051 billion) in
2020 to BRL4.767 billion (US$938.5 million) during the 2021 fiscal
year.  

Regarding its annual revenues, the company revealed a 72% growth to
BRL9.975 billion (about US$1.963 billion), according to Rio Times
Online.

During the fourth quarter, Azul demonstrated the competitive and
sustainable advantages of its business model by achieving "the
highest revenues" in its history, it said, the report notes.  Thus,
in the period, operating revenues reached a record BRL3.7 billion,
the report relays.

The company closed 2021 in losses, but lower than those recorded in
2020, this due to the fact that demand continues to recover with a
view to achieving the 2019 record, the report adds.

                         *    *    *

As reported in the Troubled Company Reporter-Latin America in July
2020, Natalia Scalzaretto at The Brazilian Report related that Azul
Airlines is said to have laid off more than 1,000 airport
maintenance workers, according to trade union sources heard by the
Brazilian press.  They estimate that the layoffs may prompt Azul to
abandon operations in 27 cities.  The company at that time didn't
confirmed how many workers was to be dismissed but says that
roughly 5,000 jobs were saved due to agreements with union,
employing changes such as reduced hours.




===========================
C A Y M A N   I S L A N D S
===========================

LMR LONG HORIZON: Dissolution Hearing Set for March 21
------------------------------------------------------
The hearing for the application to dissolve LMR Long Horizon Master
Fund Limited, which is in liquidation, is set for March 21, 2022.
The hearing of the application will take place at the Law Courts,
Gorge Town, Grand Cayman, Cayman Islands.

Any creditor or member who wish to attend should sent an email to
the liquidator, Christopher Kennedy at
cbourgy@alvarezandmarsal.com




=============
J A M A I C A
=============

[*] JAMAICA: Travel Restrictions Removal to Boost Sector, JHTA Says
-------------------------------------------------------------------
RJR News reports that the Jamaica Hotel and Tourist Association
(JHTA) says the removal of some travel restrictions will provide a
boost to the sector.

JHTA President, Clifton Reader, noted that it is now possible for
business travellers to visit Jamaica without needing to quarantine,
according to RJR News.

Reader said a recent JHTA poll showed that more than 80 per cent of
travellers to Jamaica are either partially or fully vaccinated,
the report notes.

Prime Minister Andrew Holness announced the removal of  Covid-19
containment measures  including the Jam-Covid authorization for
travel to the island and the elimination of  travel-related
quarantine, the report relates.

As reported in the Troubled Company Reporter-Latin America on Nov.
25, 2021, Moody's Investors Service has affirmed the Government of
Jamaica's long-term issuer and senior unsecured ratings at B2. The
senior unsecured shelf rating has also been affirmed at (P)B2. The
outlook on the ratings remains stable.




=====================
P U E R T O   R I C O
=====================

EMPACADORA Y PROCESADORA: Seeks Approval to Hire Financial Advisor
------------------------------------------------------------------
Empacadora Y Procesadora Del Sur, Inc. seeks approval from the U.S.
Bankruptcy Court for the District of Puerto Rico to hire CPA Luis
R. Carrasquillo & Co., P.S.C. as its financial advisor.

The firm will assist the Debtor in the restructuring of its affairs
by providing advice on strategic planning and the preparation of
the Debtor's plan of reorganization, and by participating in
negotiations with creditors.

The hourly rates charged by the firm for its services are as
follows:

     CPA Luis R. Carrasquillo       $185
     CPA Marcelo Gutierrez          $135
     CPA Arnaldo Morales Rivera     $95
     CPA Zoraida Delgado Diaz       $85
     CPA David Sanchez Diaz         $60
     Carmen Callejas Echevarria     $90
     Enid M Olmeda                  $45
     Rosalie Hernandez Burgos       $35
     Kelsie Lopez, Esq.             $45

The firm received a $22,000 retainer.

As disclosed in court filings, Carrasquillo and its members are
disinterested persons within the meaning of Section 101(14) of the
Bankruptcy Code.

The firm can be reached through:

     Luis R. Carrasquillo Ruiz
     CPA Luis R. Carrasquillo & Co., P.S.C.
     28th Street, # TI-26
     Turabo Gardens Ave.
     Caguas, PR 00725
     Tel: (787) 746-4555/(787) 746-4556
     Fax: (787) 746-4564
     Email: luis@cpacarrasquillo.com

               About Empacadora Y Procesadora Del Sur

Empacadora Y Procesadora Del Sur, Inc., a company in Coamo, P.R.,
sought protection under Chapter 11 of the Bankruptcy Code (Bankr.
D.P.R. Case No. 22-00354) on Feb. 15, 2022, listing $11,604,565 in
assets and $10,598,204 in liabilities. Carlos C. Rodriguez Alonso,
president, signed the petition.

Judge Maria De Los Angeles Gonzalez oversees the case.

Alexis Fuentes Hernandez, Esq., at Fuentes Law Offices and CPA Luis
R. Carrasquillo & Co., P.S.C. serve as the Debtor's legal counsel
and financial advisor, respectively.


EMPACADORA Y PROCESADORA: Taps Fuentes Law Offices as Counsel
-------------------------------------------------------------
Empacadora Y Procesadora Del Sur, Inc. seeks approval from the U.S.
Bankruptcy Court for the District of Puerto Rico to hire Fuentes
Law Offices, LLC, to handle its Chapter 11 case.

Fuentes Law Offices will bill $250 per hour for its services.  The
firm received a retainer in the amount of $25,000.

As disclosed in court filings, Fuentes Law Offices has no prior
connections with the Debtor, any creditor or other party in
interest.

The firm can be reached through:

     Alexis Fuentes-Hernandez, Esq.
     Fuentes Law Offices, LLC
     PO BOX 9022726
     San Juan, PR 009022726
     Phone: +1 787 722 5216
     Fax: +1 787 722 5206
     Email: fuenteslaw@icloud.com

               About Empacadora Y Procesadora Del Sur

Empacadora Y Procesadora Del Sur, Inc., a company in Coamo, P.R.,
sought protection under Chapter 11 of the Bankruptcy Code (Bankr.
D.P.R. Case No. 22-00354) on Feb. 15, 2022, listing $11,604,565 in
assets and $10,598,204 in liabilities. Carlos C. Rodriguez Alonso,
president, signed the petition.

Judge Maria De Los Angeles Gonzalez oversees the case.

Alexis Fuentes Hernandez, Esq., at Fuentes Law Offices and CPA Luis
R. Carrasquillo & Co., P.S.C. serve as the Debtor's legal counsel
and financial advisor, respectively.


PUERTO RICO: PREPA Bondholders Say Mediator Needed for Plan B
-------------------------------------------------------------
The Ad Hoc Group of PREPA Bondholders, a group of holders of bonds
issued by the Puerto Rico Electric Power Authority (PREPA), filed
in mid-February 2022 an urgent motion to:

   (i) reappoint the Honorable Barbara J. Houser (Ret.) as mediator
to facilitate negotiations between the Financial Oversight and
Management Board for Puerto Rico  and the Ad Hoc Group in
connection with a path forward if the RSA  legislation is not
passed and, once that objective is achieved, a comprehensive
resolution of issues and claims in PREPA's Title III case through a
plan of adjustment with other creditors if necessary, and

  (ii) to impose deadlines with respect to a plan of adjustment for
the PREPA.

On Feb. 28, the Official Committee of Unsecured Creditors said in
court filings that it is not opposed to mediation to try to reach a
global resolution with all parties in interest, including the
Committee, regarding a PREPA plan of adjustment.

However, according to the Creditors Committee, the PREPA
bondholders are asking the Court to impose a plan and confirmation
schedule and implement a mediation process that would not only
continue to bar the Committee from pursuing its objection to the
PREPA bond claims, but would apparently not even permit the
Committee to participate in the mediation until after talks between
the Oversight Board and the PREPA bondholders have concluded -- and
only then if the mediator believes that such participation "may
broaden support for a PREPA plan of adjustment to be filed by the
Oversight Board."

"No global resolution will occur, however, if the PREPA bondholders
and the Oversight Board are allowed to negotiate a deal among
themselves first and then attempt to involve the Committee and
other parties later.  This approach has not succeeded in the past
in these cases -- including when the Oversight Board mediated
unilaterally with the HTA bondholders in the HTA case, relegating
the Committee to the sidelines until after the Oversight Board
reached a deal with the HTA bondholders -- and will inevitably fail
again here.  Any mediation process must involve all of PREPA's key
stakeholders, including most notably the Committee," the Creditors
Committee tells the Court.

In response to the objection by the Creditors Committee and other
parties, the PREPA bondholders note the thrust of most of
the "objections" is simply to request that the mediation be
broadened in scope and include the objectors as parties.  The Ad
Hoc Group notes that it has filed a revised proposed order that
which makes clear that all parties are welcome to participate and
allows the mediator to determine the order in which to meet with
parties.

                         PREPA Plan Deal

The Ad Hoc Group believes that the RSA -- a preexisting consensual
agreement negotiated over a number of years that resolves the
overwhelming majority of PREPA's financial debt -- is the most
logical starting place for the mediation.

According to the bondholders, the Oversight Board and AAFAF have
reaffirmed their support for the RSA as the basis for a PREPA
plan.

The RSA remains the right deal, with "gargantuan benefits" for
PREPA and the people of Puerto Rico.  It reduces legacy debt by
more than $2 billion and the present value of PREPA's debt service
by at least 40%, while offering an "unprecedented" benefit to
ratepayers: under the terms of the RSA, PREPA is not contractually
obligated to increase rates to ratepayers above a pre-set,
non-fluctuating charge to cover debt service.  The RSA also
resolves significant pending litigation that, if left unabated,
could mire PREPA in years of litigation, expose
it to billions of dollars of additional debt payments, and risk
delaying its emergence from Title III indefinitely.

As currently drafted, the RSA requires legislation.  Wile the Ad
Hoc Group welcomes the opportunity to continue to engage with the
Puerto Rico Legislature, it is clear that simply continuing to wait
for passage of the legislation is not a viable option.

The Ad Hoc Group believes that a Plan B solution that preserves the
benefits of the RSA is achievable. The Ad Hoc Group believes that a
mediator can assist the parties in reaching a non-legislative
solution to the RSA.  The framework of the RSA already exists, and
it provides enormous benefits for both sides.  What the parties
need is a neutral third party that is empowered to establish a
structured process for engagement and negotiation.

The bondholders assert that the Creditors Committee (with two PREPA
creditors among its seven members) questions the business judgment
of the Oversight Board and AAFAF in having reached the RSA, and
makes clear that it prefers to engage in years of scorched earth
litigation that would indefinitely delay PREPA's exit from Title
III.

                        About Puerto Rico

Puerto Rico is a self-governing commonwealth in association with
the United States that's facing a massive bond debt of $70 billion,
a 68% debt-to-GDP ratio and negative economic growth in nine of the
last 10 years.

The Commonwealth of Puerto Rico has sought bankruptcy protection,
aiming to restructure its massive $74 billion debt-load and $49
billion in pension obligations.

The debt restructuring petition was filed by Puerto Rico's
financial oversight board in U.S. District Court in Puerto Rico
(Case No. 17-01578) on May 3, 2017, and was made under Title III of
2016's U.S. Congressional rescue law known as the Puerto Rico
Oversight, Management, and Economic Stability Act ('PROMESA').

The Financial Oversight and Management Board later commenced Title
III cases for the Puerto Rico Sales Tax Financing Corporation
(COFINA) on May 5, 2017, and the Employees Retirement System (ERS)
and the Puerto Rico Highways and Transportation Authority (HTA) on
May 21, 2017. On July 2, 2017, a Title III case was commenced for
the Puerto Rico Electric Power Authority ("PREPA").

U.S. Chief Justice John Roberts has appointed U.S. District Judge
Laura Taylor Swain to oversee the Title III cases. The Honorable
Judith Dein, a United States Magistrate Judge for the District of
Massachusetts, has been designated to preside over matters that may
be referred to her by Judge Swain, including discovery disputes,
and management of other pretrial proceedings.

Joint administration of the Title III cases, under Lead Case No.
17-3283, was granted on June 29, 2017.

The Oversight Board has hired as advisors, Proskauer Rose LLP and
O'Neill & Borges LLC as legal counsel, McKinsey & Co. as strategic
consultant, Citigroup Global Markets, as municipal investment
banker, and Ernst & Young, as financial advisor.

Martin J. Bienenstock, Esq., Scott K. Rutsky, Esq., and Philip M.
Abelson, Esq., of Proskauer Rose; and Hermann D. Bauer, Esq., at
O'Neill & Borges are on-board as attorneys.

McKinsey & Co. is the Board's strategic consultant, Ernst & Young
is the Board's financial advisor, and Citigroup Global Markets
Inc.
is the Board's municipal investment banker.

Prime Clerk LLC is the claims and noticing agent.  Prime Clerk
maintains a case web site at
https://cases.primeclerk.com/puertorico

Epiq Bankruptcy Solutions LLC is the service agent for ERS, HTA,
and PREPA.

O'Melveny & Myers LLP is counsel to the Commonwealth's Puerto Rico
Fiscal Agency and Financial Advisory Authority (AAFAF), the agency
responsible for negotiations with bondholders.

The Oversight Board named Professor Nancy B. Rapoport as fee
examiner and to chair a committee to review professionals' fees.

                          *     *     *

The two Title III plans of adjustment have been confirmed to date,
for the Commonwealth and COFINA debtors.



                           *********


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 2022.  All rights reserved.  ISSN 1529-2746.

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers.

Information contained herein is obtained from sources believed to
be reliable, but is not guaranteed.

The TCR Latin America subscription rate is US$775 per half-year,
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 * * *