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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
Wednesday, May 18, 2022, Vol. 23, No. 93
Headlines
A R G E N T I N A
ARGENTINA: Central Bank Raises Key Rate to 49% as Inflation Jumps
ARGENTINA: Massive Protest in Demand for Work
B R A Z I L
BRADSEG PARTICIPACOES: Fitch Assigns 'BB' IDRs, Outlook Negative
BRAZIL: Inflation Hits Highest Since 2003 as Food Prices Soar
C A Y M A N I S L A N D S
TRIDENT ENERGY: Fitch Assigns 'B+' LongTerm IDRs, Outlook Stable
C H I L E
CHILE: $1.5MM Loan From IDB to Benefit More Than 300,000 Migrants
D O M I N I C A N R E P U B L I C
[*] DOMINICAN REPUBLIC: Abinader Bets on Tourism
- - - - -
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A R G E N T I N A
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ARGENTINA: Central Bank Raises Key Rate to 49% as Inflation Jumps
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Ignacio Olivera Doll at Bloomberg News reports the Central Bank
raised interest rates for the fifth time this year in a bid to keep
up with rising inflation, people familiar with the decision said.
The BCRA (Banco Central de la Republica Argentina), as Argentina's
monetary authority is known, raised its benchmark Leliq rate by 200
basis points to 49 percent, according to the sources, who asked not
to be identified because the decision has not yet been announced,
according to Bloomberg News. The hike also boosts the annual
effective rate, which was slightly above 55 percent, the report
notes.
A Central Bank press officer did not immediately respond to a
request for comment.
The rate hike comes after the INDEC national statistics bureau
released data showing consumer prices rose six percent in April,
lifting inflation to its highest annual level since 1992, the
report recalls.
Russia's invasion of Ukraine, which pushed up energy and food
prices around the world, has added another boost to Argentina's
already high inflation rate, the report notes. A faster rate of
controlled peso devaluations and import restrictions have also
raised prices, while a plan to eliminate subsidies on electricity
bills this year will also keep inflation high, the report relays.
Argentina is also raising rates to comply with its US$44-billion
debt agreement with the International Monetary Fund, which requires
the government to keep borrowing costs, as measured by the
effective annual rate, above inflation, the report adds.
About Argentina
Argentina is a country located mostly in the southern half of
South America. Its 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.
Last March 25, 2022, Argentina finalized agreement with the IMF
for a new USD44 billion Extended Funding Facility (EFF) intended
to fund USD40 billion in looming repayments of the defunct
Stand-By Arrangement (SBA), with an extra USD4 billion in
up-front net financing. This has averted the risk of a default to
the IMF and is facilitating a parallel rescheduling of Paris
Club debt.
As reported by The Troubled Company Reporter - Latin America on
April 14, 2022, Fitch Ratings affirmed Argentina's Long-Term
Foreign and Local Currency Issuer Default Ratings (IDR) at 'CCC'.
Fitch said Argentina's 'CCC' ratings reflect weak external
liquidity and pronounced macroeconomic imbalances that undermine
debt repayment capacity, and uncertainty regarding how much
progress can be made on these issues under a new IMF program.
Fitch added that it is uncertain whether the EFF will be a
strong anchor for macroeconomic stabilization. Its policy
requirements are fairly unambitious relative to other IMF
programs and in light of the economy's deep imbalances, but it
faces heightened risk nonetheless from weak political support and
spill-overs from the Russia-Ukraine war, says Fitch.
Standard & Poor's credit rating for Argentina stands at CCC+ with
stable outlook, which was a rating upgrade issued on Sept. 8,
2020. Moody's credit rating for Argentina was last set at Ca on
Sept. 28, 2020. DBRS' credit rating for Argentina is CCC, given
on Sept. 11, 2020.
ARGENTINA: Massive Protest in Demand for Work
---------------------------------------------
Rio Times reports that in the midst of acute poverty and
accelerated inflation, thousands of social and political activists
who participated for three days in a protest march that toured part
of Argentina converged in the capital to join a demonstration
demanding more work and income. and against the International
Monetary Fund.
The activists are concentrated around the main railway stations and
plan to protest first before different organizations such as the
Ministry of Economy, and then gather in the Plaza de Mayo in front
of the Government House, according to Rio Times.
Buenos Aires received from the first hours three columns with
hundreds of vehicles transporting demonstrators who entered from
different points of the city, the report notes.
About Argentina
Argentina is a country located mostly in the southern half of
South America. Its 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.
Last March 25, 2022, Argentina finalized agreement with the IMF
for a new USD44 billion Extended Funding Facility (EFF) intended
to fund USD40 billion in looming repayments of the defunct
Stand-By Arrangement (SBA), with an extra USD4 billion in
up-front net financing. This has averted the risk of a default to
the IMF and is facilitating a parallel rescheduling of Paris
Club debt.
As reported by The Troubled Company Reporter - Latin America on
April 14, 2022, Fitch Ratings affirmed Argentina's Long-Term
Foreign and Local Currency Issuer Default Ratings (IDR) at 'CCC'.
Fitch said Argentina's 'CCC' ratings reflect weak external
liquidity and pronounced macroeconomic imbalances that undermine
debt repayment capacity, and uncertainty regarding how much
progress can be made on these issues under a new IMF program.
Fitch added that it is uncertain whether the EFF will be a
strong anchor for macroeconomic stabilization. Its policy
requirements are fairly unambitious relative to other IMF
programs and in light of the economy's deep imbalances, but it
faces heightened risk nonetheless from weak political support and
spill-overs from the Russia-Ukraine war, says Fitch.
Standard & Poor's credit rating for Argentina stands at CCC+ with
stable outlook, which was a rating upgrade issued on Sept. 8,
2020. Moody's credit rating for Argentina was last set at Ca on
Sept. 28, 2020. DBRS' credit rating for Argentina is CCC, given
on Sept. 11, 2020.
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B R A Z I L
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BRADSEG PARTICIPACOES: Fitch Assigns 'BB' IDRs, Outlook Negative
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Fitch Ratings has assigned, for the first time, Local Currency Long
Term Issuer Default Ratings (IDRs) to Bradseg Participacoes S.A.
(Bradseg) at 'BB' with a Negative Rating Outlook, as well as the
National Long-Term Rating of 'AAA(bra)', with a Stable Outlook. The
rating reflects the company's strategic importance to its parent
Banco Bradesco, of which it is a core subsidiary.
KEY RATING DRIVERS
Bradseg's ratings are aligned with those of its parent, Banco
Bradesco S.A. (Bradesco, Local Currency Long-Term IDR BB/Negative).
The Outlook for Bradseg's IDR rating mirrors that of its parent's
Long-Term Local Currency IDR, which, in turn remains one notch
above Brazil's sovereign rating (Long-Term Local Currency IDR
BB-/Negative).
Fitch views Bradseg as a 'core subsidiary' of Bradesco, and
therefore its ratings are equalized with those of its parent. This
is based on the strategic importance of its Bradseg insurance
operations which complement the main retail banking activities,
common branding and high contribution of Bradseg to group profits.
The insurance holding company has consistently contributed about
26% of the bank's consolidated earnings historically.
The ratings also reflect the company's leading position in the
Brazilian insurance market, consistent performance through the
cycles, diversified revenue base, strong distribution capacity
underpinned by Bradesco's wide agency network and comfortable
liquidity and capitalization ratios.
At YE 2021, life and pension segments remained the largest
contributors to gross written premiums (47%) in 2021, followed by
health (38%), property/casualty (P/C, 8%), and savings bonds (7%).
In 2021, premiums written grew by around 11%, Bradseg grew in all
business lines. Pension and life premiums grew 12.5%, healthcare
9.4%, P&C 14.8% and Saving Bonds around 4.5%.
The company's leverage indicators are strong and comfortable.
Leverage indicators increased in 2021 due to higher premium volume
and capital reduction, but remained at favorable levels. Despite
this, operational and asset leverage ratio remains strong compared
with Fitch's international life insurer company benchmark ranges.
At the end of 2021, the indicators were 2.2x and 10.9x,
respectively.
The profitability presented by Bradseg in 2021 was better than the
previous year, with a ROE of 15%. Despite this, profitability is
still below previous years, the ROAE between 2018 and 2021 was 17%.
The net income performance was driven by the growth in premiums and
the increase in the Financial Result, given the behavior of the
economic-financial indices, which absorbed the increase in the Loss
Ratio, which was mainly affected by the adverse impacts of the
pandemic. However, the company has a solid and consistent record of
technical results through the cycles. This reflects its sound
underwriting skills, control systems and pricing practices.
In 2021, Bradseg's investment portfolio remained concentrated on
Brazilian government securities, which made up 83% of the total
exposure. The company's liquidity remains adequate, with all the
regulatory minimum liquidity ratios comfortably met.
In applying Fitch's insurance criteria regarding the impact of
ownership on Bradseg's ratings, Fitch considered how the ratings
would theoretically be impacted under Fitch's bank support
criteria. Fitch's insurance criteria are principles based regarding
ownership, and the referenced bank criteria was used to help inform
Fitch's judgment in applying those principles.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
Bradseg's ratings are linked to that of Banco Bradesco. Therefore,
any negative change in the bank's ratings would affect the issuer's
ratings, as would a change in its willingness to provide support,
which Fitch considers highly unlikely.
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
Bradseg's IDR rating has limited upside potential, as they are
equalized to those of Banco Bradesco. Over the medium term, the
ratings could benefit from stabilization and eventual improvement
of Fitch's assessment of the operating environment for Brazilian
banks.
For the national scale rating, this sensitivity is not applicable,
given that the National Long-Term rating of Bradseg was affirmed at
'AAA(bra)'.
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Financial Institutions and
Covered Bond 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 four 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.
BRAZIL: Inflation Hits Highest Since 2003 as Food Prices Soar
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globalinsolvency.com, citing Bloomberg News, reports that Latin
American central banks will likely extend their monetary tightening
campaigns beyond what was originally expected after inflation
surged past forecasts in April, with steep increases in food and
fuel costs stinging policy makers.
Brazil's consumer prices rose 12.13% from a year prior according to
data released, the fastest pace in nearly two decades and also
above the 12.06% median estimate in a Bloomberg survey.
Headline inflation also topped forecasts in Peru, Colombia and
Chile in the same month, as did the closely-watched core index in
Mexico, according to globalinsolvency.com.
Latin American policy makers are getting no respite from raging
price increases that had already blown past even the most
pessimistic forecasts in many countries in March, the report notes.
The region's central banks were among the first in the world to
start tightening last year in the wake of pandemic stimulus. They
are now facing growing warnings -- and, in some cases, political
pressure --- about damage to economic growth, the report relays.
About Brazil
Brazil is the fifth largest country in the world and third largest
in the Americas. Jair Bolsonaro is the current president, having
been sworn in on Jan. 1, 2019.
As reported in the Troubled Company Reporter-Latin America on
April 15, 2022, Moody's Investors Service affirmed the Government
of Brazil's long-term Ba2 issuer ratings and senior unsecured bond
ratings, (P)Ba2 senior unsecured shelf ratings, and maintained the
stable outlook.
Standard & Poor's credit rating for Brazil stands at BB- with
stable outlook (April 2020). S&P's 'BB-/B' long-and short-term
foreign and local currency sovereign credit ratings for Brazil
were affirmed in December 2021 with stable outlook. Fitch Ratings'
credit rating for Brazil stands at 'BB-' with a negative outlook
(November 2020). Fitch's 'BB-' Long-Term Foreign and Local
Currency Issuer Default Ratings (IDRs) has been affirmed in
December 2021. DBRS's credit rating for Brazil is BB (low) with
stable outlook (March 2018).
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C A Y M A N I S L A N D S
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TRIDENT ENERGY: Fitch Assigns 'B+' LongTerm IDRs, Outlook Stable
----------------------------------------------------------------
Fitch Ratings has assigned Long-Term Foreign and Local Currency
Issuer Default Ratings (IDRs) of 'B+' to Trident Energy,
L.P.(Trident). Fitch has also assigned a 'B+/'RR4' rating to the
proposed $550 million senior secured notes due 2027 to be issued by
Trident Energy Finance Plc. and fully guaranteed by Trident Energy,
L.P and its material domestic and foreign subsidiaries. The Rating
Outlook is Stable.
Trident's ratings reflect its modest production profile of 32kboed,
complemented by a robust 1P reserve life of 13 years. Trident's
lifting costs are competitive for an off-shore oil producer, which
Fitch estimates at $24 bbl in 2021 and an average $20 bbl the
rating horizon.
The company's credit ratings remain constrained, despite strong
operating metrics, by its relatively small size and the low
diversification of its oil fields. However, increasing production
levels while maintaining its existing reserve life and capital
structure are positive indicators. The ratings also reflect low
leverage at 1.0x and a robust liquidity profile.
KEY RATING DRIVERS
Small Production Profile: Trident's ratings are constrained by its
limited production size with Fitch-estimated output of 35,800 bbld
in 2022, which is split between Equatorial Guinea (40.42% WI) and
Brazil clusters (100% WI), where it produces light crude. The
rating case includes an expectation that production will increase
to 50,400 bbld on average between 2022 through 2026, which remains
consistent with the 'B' rating category. The growth in production
is due to the company's investments in mid-cycle assets, the
reactivation and optimization of certain wells via acid jobs,
installation of Electrical Submersible Pumps (ESP), and artificial
lifting among other low-cost, low-risk methods of extraction.
Robust Reserve Life: Trident has a strong 1P reserve life, which
exceeds 13 years, and PDP reserve life of more than seven years;
both ratios are consistent with a higher rating category. Trident
is well positioned to maintain its production metrics beyond the
rating horizon. Fitch expects rapid production increases to be
supported by an assumed reserve replacement rate of 100% through
the forecasted period. Trident's 1P reserve life compares favorably
to that of the average of its 'B' rated peers of seven years.
Competitive Cost Structure: Trident has a competitive cost
production profile that allows it to remain profitable at low
prices. Fitch estimates its half-cycle cost was $27 bbl in 2021,
and its Full-cycle cost of production, which is defined as the
half-cycle cost plus the three-year average FD&A for 1P of $10 bbl
is $37 bbl. Trident's half-cycle cost is slightly higher than its
peers, which average $21 bbl. The difference in cost profile is
mostly attributed to Trident being the only offshore energy company
in Fitch's rated portfolio. Over the rating horizon, Trident's cost
profile coupled with Fitch's price deck, which assumes $100 Brent
in 2022 and $50 long term, is expected to generate strong cash
flow.
Low Leverage: Trident's leverage is expected to decrease to 1.0x
debt to EBITDA in 2022 and remain at an average of 1.1x debt to
EBITDA through 2026. The spike in leverage realized in 2021
reflects a lower-price environment and production numbers not yet
reaching optimal levels. The strong prices that shaped the oil
market in the first months of 2022, in combination with increased
production are expected to allow Trident to maintain robust credit
metric through the rating horizon. Leverage measured as total debt
to 1P reserves is expected to be $4.86/bbl through 2026, which
compares favorably to peers, whose average was $6.02/bbl at YE
2021.
Financial Flexibility: Fitch's rating case assumes Trident will
have conservative financial policies, which incorporates hedging a
portion of its production, supporting its cost production profile.
Over the rating horizon, funds from operations are estimated to
cover capex by an average of 3.2x times under Fitch's price deck
assumption. Further, a strong reserve profile gives the company
flexibility in allocating capital in the event of price volatility.
The rating case assumes annual dividend will be 50% of net income
and should not materially exceed FCF.
DERIVATION SUMMARY
Trident's credit and business profile is comparable to other small
independent oil producers in Latin America. The ratings of
SierraCol (B+/Stable), Geopark (B+/Stable), Frontera Energy
Corporation (B/Stable), and Gran Tierra Energy International
Holdings Ltd. (B-/Stable) are all constrained to the 'B' category
or below due to the inherent operational risk associate with small
scale and low diversification of their oil and gas production.
Trident's production profile compares favorably with other 'B'
rated Latin American oil exploration and production companies. Over
the rating horizon, Fitch expects Trident's production will average
52,000 bbld. This is slightly higher than Geopark and Frontera,
both of which Fitch expects to average 45,000 bbld, and
significantly higher than SierraCol and Gran Tierra Energy, which
range from 30,000 bbld to 40,000 kbbl. Trident's PDP reserve life
of 7.2 years and 1P reserve life of 13 years in 2021 compares
favorably to SierraCol at 4.8 years and 6.3 years, Frontera at 1.6
years and 6.2 years, Geopark at 4.0 years and 7.4 years, and Gran
Tierra at 5.7 years and 9.5 years.
Trident's half-cycle production cost was $27.4 bbl in 2021 and
full-cycle cost was $44.9 bbl, above other onshore producers. The
lowest cost onshore producer in the region, Geopark, has a cost
profile of $13.60 bbl and $23.40 bbl. Frontera, at the higher side
of the spectrum, these costs were $28.60bbl and $42.20 bbl in
2021.
Trident has a strong capital structure, and Fitch expects it will
have average gross leverage of 1.1x over the rating horizon, total
debt to PDP of $6.55 bbl, and total debt to 1P of $3.62 bbl, which
is lower than all of its peers. Geopark has gross leverage of 1.8x
and Debt to PDP of $10.24bbl and 1P of $5.48 bbl; Gran Tierra has
2.7x, $16.8 bbl and $10.05 bbl; SierraCol has 1.0x, $7.5 bbl and
$5.68 bbl; and Frontera has 2.3x, $19.93 bbl and $4.98 bbl.
KEY ASSUMPTIONS
-- Annual realized oil prices at a $1.7 discount in EG and $5.5
in Brazil to Fitch's price deck for Brent of $100 in 2022, $80
in 2023, and $53 thereafter;
-- Average daily production of 52,400 bbld from 2022 through
2026;
-- Reserve replacement ratio of 100% per annum;
-- Lifting and transportation cost average of $20bbl;
-- SG&A cost average of $2.0 bbl;
-- Consolidated capex of $1.064 billion from 2022 through 2026
averaging $213 million per year;
-- Dividends of 50% of net income;
-- Effective tax rate of 40% in 2022, 33% in 2023, 32% in 2024,
and 25% thereafter;
-- No new debt issuances beyond the 2027 $550 million notes.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- Net production rising consistently to 75,000 boed on a
sustained basis while maintaining 1P reserve life of at least
10 years;
-- Maintenance of a conservative financial profile, with gross
leverage of 2.5x or below.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- Extraordinary dividend payments that exceed FCF and weaken
liquidity;
-- Sustainable production falls below 30,000 boed;
-- Reserve life declines to below six years on a sustained basis;
-- A significant deterioration of total debt/EBITDA to 3.0x or
more.
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Non-Financial Corporate
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 four 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.
LIQUIDITY AND DEBT STRUCTURE
Adequate Liquidity Post Transaction: Fitch estimates Tridents' pro
forma cash balance by year-end 2022 at $479 million, up from its
reported balance of $143 in 2021, due to high FCF generation
supported by elevated Brent prices in 2022. The company's liquidity
is further strengthened by a $200 million revolving credit
facility.
ISSUER PROFILE
Trident Energy L.P. is an international energy company with assets
in Brazil and Equatorial Guinea, the primary shareholders of which
are Warburg Pincus and Quantum. The company's expertise is focused
on extraction from mid-life producing O&G assets that can deliver
production growth while still generating significant FCF.
ESG CONSIDERATIONS
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.
DEBT RATING RECOVERY
---- ------ --------
Trident Energy, L.P.
LT IDR B+ New Rating
LC LT IDR B+ New Rating
Trident Energy Finance PLC
senior secured LT B+ New Rating RR4
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C H I L E
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CHILE: $1.5MM Loan From IDB to Benefit More Than 300,000 Migrants
-----------------------------------------------------------------
IDB Lab, the innovation laboratory of the Inter-American
Development Bank (IDB), will provide a loan of up to $1.5 million
to the Chilean fintech, Migrante, to mitigate economic
vulnerability and improve migrants' access to loans and financial
services. The loan will contribute to the expansion and
internationalization of the company and will benefit more than
330,000 migrants, mainly Venezuelans, in Chile and Peru.
In Chile, Migrante offers financial products, designed to meet the
specific needs of migrants. Its "banking for entrepreneurs"
services include credits for the purchase of vehicles and
motorcycles, widely used as work tools to generate income with
urban mobility, home distribution, and logistics services.
Additionally, Migrante offers "banking for people" services, such
as credits for the homologation of professional degrees, housing
rental guarantees, and, to a lesser extent, consumer credits that
help migrants to furnish their homes with basic equipment.
The adaptation of Migrante's credit qualification and allocation
methodology to the peculiarities of Venezuelan migration allows
beneficiaries to obtain a loan, even if it is initially small,
quickly. The transactions are carried out by digital means, such as
a cell phone or computer, avoiding travel. In addition, the Chilean
fintech has developed automated systems that facilitate the
collection of its clients and compliance monitoring with their
financial obligations, resulting in an efficient and sustainable
collection and recovery process. Its value proposition is based on
the construction of a community with the ability to develop
additional products and services that accompany migrants throughout
their journey.
This loan from IDB Lab will allow Migrante to support the expansion
and internationalization of its services to other countries in the
region, starting with Peru, where the number of displaced
Venezuelans is even greater than in Chile. In addition, it will
pilot new financial products to reach segments of neglected
immigrants, particularly immigrant women, making it easier for them
to generate job opportunities in branches related to their
qualifications or in ways that contribute to and improve their
family's well-being.
IDB Lab has developed other projects in support of migrants, such
as those articulated in the "Better Together Challenge", an
initiative launched in collaboration with USAID, the United States
Agency for International Development, to identify, finance, and
scale innovative solutions that support Venezuelan migrants and
their host communities in Latin America and the Caribbean.
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D O M I N I C A N R E P U B L I C
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[*] DOMINICAN REPUBLIC: Abinader Bets on Tourism
------------------------------------------------
Dominican Today reports that President Luis Abinader reiterated his
support for the recovery of the tourism sector, highlighting that
this work has been carried out with "passion, patriotism and
enthusiasm, trusting in the process despite having assumed the
government at the worst moment of the pandemic."
The president said he felt optimistic about the numbers for April,
those projected for May and summer, and a high season that includes
autumn and winter, according to Dominican Today.
Pointing out that he came to receive attacks for the attention and
trips he made to this coast, in which he was referred to as the
Republic of Punta Cana, Abinader stressed, however, that the effort
was worth it since it was always clear that returning to the
normality of the sector implied the recovery of the country, the
report notes.
"We are going to continue doing this work, creating new jobs,
recover the jobs that had been lost and for people to earn a living
with dignity, for which we congratulate the company Expedia and the
Ministry of Tourism, for what has been achieved," said Abinader,
the report relays.
The head of state, who spoke at the event where the Expedia
platform, which sells packages, trips, and tourist excursions
worldwide, recognized the country for carrying out the best
campaign for Latin America 2021-2022 in that sector, the report
discloses.
Three Agreements
While the general director of operations for Expedia Latin America
and the Caribbean, Freddy Dominguez, highlighted that the Dominican
Republic is the second-largest operation destination in Latin
America and part of its 15 most important destinations worldwide,
the report says.
The announcement was made amid three collaboration agreements with
major Canadian airlines, such as Air Canada Vacation, Sunwing
Group, and Air Transat, to enhance the country's air connectivity
during the summer and winter, the report notes.
Previously, Abinader and the Minister of Tourism, David Collado,
were recognized by Expedia, the report relays.
Abinader and Collado also attended the start of construction of the
luxury hotel "Secrets Tides Punta Cana Resort & Spa, with an
investment of US$175 million and the creation of some 3,00 jobs,
led by the construction company Codelpa with the support of the
Amrtm hotel chain. Collection, the report adds.
About Dominican Republic
The Dominican Republic is a Caribbean nation that shares the island
of Hispaniola with Haiti to the west. Capital city Santo Domingo
has Spanish landmarks like the Gothic Catedral Primada de America
dating back 5 centuries in its Zona Colonial district. Luis Rodolfo
Abinader Corona is the current president of the nation.
TCRLA reported in April 2019 that the Dominican Today related that
Juan Del Rosario of the UASD Economic Faculty cited a current
economic slowdown for the Dominican Republic and cautioned that if
the trend continues, growth would reach only 4% by 2023. Mr. Del
Rosario said that if that happens, "we'll face difficulties in
meeting international commitments."
An ongoing concern in the Dominican Republic is the inability of
participants in the electricity sector to establish financial
viability for the system.
Fitch Ratings, in December 2021, revised the Outlook on Dominican
Republic's Long-Term Foreign-Currency Issuer Default Rating (IDR)
to Stable from Negative and affirmed the IDRs at 'BB-'. The
revision of the Outlook to Stable reflects the narrowing of
Dominican Republic's government deficit and financing needs since
Fitch's last review resulting in the stabilization of the
government debt/GDP ratio, as well as the investment-driven
economic momentum, reflected in the faster-than-expected economic
recovery in 2021 that Fitch expects to carry into above-potential
GDP growth during 2022 and 2023.
Standard & Poor's, also in December 2021, revised its outlook on
the Dominican Republic to stable from negative. S&P also affirmed
its 'BB-' long-term foreign and local currency sovereign credit
ratings and its 'B' short-term sovereign credit ratings. The
stable outlook reflects S&P's expectation of continued favorable
GDP growth and policy continuity over the next 12 to 18 months that
will likely stabilize the government's debt burden, despite lack of
progress with broader tax reforms, S&P said. A rapid economic
recovery from the downturn because of the pandemic should mitigate
external and fiscal risks.
Moody's affirmed the Dominican Republic's long-term issuer and
senior unsecured ratings at Ba3 and maintained the stable outlook
in March 2021.
*********
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.
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