/raid1/www/Hosts/bankrupt/TCRLA_Public/221010.mbx
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
Monday, October 10, 2022, Vol. 23, No. 196
Headlines
A R G E N T I N A
ARGENTINA: IDB Approves 40MM-Loan for Neuquen Province MSMEs
B R A Z I L
BANCO ALFA: Moody's Affirms Ba2 Deposit Ratings, Outlook Stable
GREAT PANTHER: Court Converts NOI Proceedings to CCAA Proceedings
C H I L E
LATAM AIRLINES: Banks Sweeten Bond Prices Needed for Bankr. Exit
D O M I N I C A N R E P U B L I C
DOMINICAN REPUBLIC: Peso Appreciates by 8.75% Against the Dollar
G U Y A N A
RAMPS LOGISTICS: Unit Slapped With Charges in Guyana
S T . V I N C E N T A N D T H E G R E N A D I N E S
ST. VINCENT & THE GRENADINES: To Get Oil Under PetroCaribe Deal
X X X X X X X X
LATAM: Fuel Subsidies Should Target Poor People
[*] BOND PRICING: For the Week Oct. 3 to Oct. 7, 2022
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A R G E N T I N A
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ARGENTINA: IDB Approves 40MM-Loan for Neuquen Province MSMEs
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The Inter-American Development Bank (IDB) approved a $40 million
loan to grant productive financing to micro-, small-, and
medium-size enterprises (MSMEs) in the Province of Neuquén,
Argentina. The operation aims to help Neuquén restore production
and provide sustainable jobs.
The program will give MSMEs access to credit on favorable terms,
whether through new lines of direct financing via a trust created
by the province, or through guarantees granted by Fondo de
Garantías de Neuquén.
Approximately 200 MSMEs in the agricultural, forestry, non-metal
mining, industrial, commercial, and service sectors will benefit
from the program. At least 25% of the portfolio is reserved for
companies led or owned by women, and at least 30% is allocated to
investments for mitigating or adapting to climate change. The
program will also ensure that at least 20 Indigenous MSMEs and 10
MSMEs run or owned by people with disabilities can access loans or
guarantees.
In addition, the program will provide technical assistance to study
the industries targeted for financing and disaggregate their data
by age range, sex, ethnicity, and disability. This assistance will
also identify sector-specific actions for closing the financing gap
for women, Indigenous people, and people with disabilities.
Likewise, the technical assistance will detect needs and
opportunities for green investments to support the demand for
financing among the identified groups.
In its Vision Neuquen 2030, the province has set a goal of
progressively diversifying its economic base to achieve a dynamic,
innovative, and powerful business environment in which the
province's business owners and entrepreneurs can capitalize on
regional, national, and global market opportunities.
The $40 million IDB loan has a 25-year maturity, a 5.5-year grace
period, and an interest rate based on the Secured Overnight
Financing Rate (SOFR).
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
Aug. 12, 2022, S&P Global Ratings affirmed its foreign and
local-currency sovereign credit ratings of 'CCC+/C' on the
Republic of Argentina. The outlook remains stable. S&P also
affirmed its national scale 'raBBB-' rating and its 'CCC+' transfer
and convertibility assessment. S&P said the stable outlook reflects
the challenges in managing pronounced economic imbalances ahead of
the 2023 national elections given disagreement on policy within the
government coalition and financing pressures in the local market.
Last 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.
On July 19, 2022, Fitch Ratings placed Argentina's Long-Term
Foreign Currency Issuer Default Rating (IDR) and Long-Term Local
Currency IDR Under Criteria Observation (UCO) following the
conversion of the agency's Exposure Draft: Sovereign Rating
Criteria to final criteria. The UCO assignment indicates that
ratings may change as a direct result of the final criteria. It
does not indicate a change in the underlying credit profile, nor
does it affect existing Rating Outlooks.
Moody's credit rating for Argentina was last set at Ca on
Sept. 28, 2020.
DBRS has also confirmed Argentina's Long-Term Foreign Currency
Issuer Rating at CCC and Long-Term Local Currency Issuer Rating at
CCC (high) on July 21, 2022.
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B R A Z I L
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BANCO ALFA: Moody's Affirms Ba2 Deposit Ratings, Outlook Stable
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Moody's Investors Service has affirmed all ratings assigned to
Banco Alfa de Investimento S.A. (Alfa), including the bank's long
and short-term local and foreign-currency long-term deposit ratings
of Ba2 and Not Prime, and the long and short-term Counterparty Risk
Ratings (CRR) of Ba1 and Not Prime. Moody's also affirmed Alfa's
Baseline Credit Assessment (BCA) and Adjusted BCA of ba2, as well
as the bank's long and short-term Counterparty Risk Assessments (CR
Assessment) of Ba1(cr) and Not Prime (cr). The ratings outlook
remains stable.
RATINGS RATIONALE
The affirmation of Alfa's ba2 BCA and Ba2 deposit ratings
acknowledges the bank's conservative risk management supporting its
long-track record of superior asset quality indicators, as well as
the consistently stable profitability and solid capital position
reported by the bank through economic cycles, which counterbalances
Alfa's institutional based funding structure, highly sensitive to a
tightening interest rate cycle.
As of June 2022, Alfa's problem loans accounted for only 0.38% of
gross loans, remaining below 1% between 2020 and 2021 and in line
with the low 0.47% average reported in the past five years
(2017-2021). Historically, the bank's problem loan ratio stood
below industry's averages, reflecting its disciplined credit
underwriting policies and highly secured loan book made 62% of
loans to large multinational and domestic companies and 38% to high
and middle income individuals. Moreover, Alfa maintained a prudent
provisioning buffer of 1.5% of gross loans as of June 2022, which
will continue to shield the bank from further asset risk pressures
resulting from the high rate and inflationary environment in
Brazil.
The bank's conservative growth strategy resulted in steady, though
low, profitability ratios, particularly compared with other similar
sized banks in Brazil. In June 2022, Alfa reported a consolidated
net income of BRL78 million, 11% above the same period in 2021. In
the first six months of 2022, performance was pressured by the fast
rise in benchmark interest rates that increased the bank's funding
costs, which are largely floating rate, and by the competitive
margins on its core products. For next year, Moody's expect new
loan origination to be negatively impacted by a moderation in
credit demand. Net income to tangible assets remained flat at 0.7%
in June 2022, and net interest margins (NIM) stood at 3.7%, below
Alfa's last five year average of 0.9% and 4.1%, respectively. The
bank's consistent earnings generation and a relatively conservative
dividend payout policy historically supported an adequate capital
position. While capitalization, measured by tangible common equity
as a percentage of risk weighted assets, declined to 11.2% in June
2022 in light of the 10% annual change in the loan book and a
dividend payout ratio of 30%, the bank maintained an adequate
regulatory capital ratio of 14%, fully comprised by common equity.
Alfa has a track record of maintaining strong liquidity buffers,
which helps to mitigate funding risks related to its exposure to
wholesale funds. In June 2022, Alfa's market-based funding
represented 60.4% of tangible assets, which was above the 44%
average ratio at similar sized banks rated Ba2 in Brazil. The bank
has centered efforts on improving its funding mix by increasing
retail deposits also through third-party brokers, which has been
attracting more granular and lower-cost resources, and has centered
efforts on lengthening the maturity profile of funds by increasing
lines with multilateral banks and issuance of long-term domestic
debt instruments.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ba2 BCA and Ba2 deposit rating assigned to Banco Alfa de
Investimento S.A. is currently at the same level as the Government
of Brazil's Ba2 sovereign bond rating, and therefore, there is
limited upward pressure to the bank's ratings at this point.
However, negative pressure on the bank's standalone credit profile
could arise from increased tolerance for credit, market or
operational risks, which could lead to higher earnings volatility
and, ultimately, negative pressure on Alfa's capital base. A
prolonged lackluster macroeconomic environment, with a potential
impact on Alfa's funding dynamics, could also reduce the bank's
recurring earnings and asset quality, hurting its financial
profile.
METHODOLOGY USED
The principal methodology used in these ratings was Banks
Methodology published in July 2021.
Affirmations:
Issuer: Banco Alfa de Investimento S.A.
Adjusted Baseline Credit Assessment, Affirmed ba2
Baseline Credit Assessment, Affirmed ba2
ST Counterparty Risk Assessment, Affirmed NP(cr)
LT Counterparty Risk Assessment, Affirmed Ba1(cr)
ST Counterparty Risk Rating (Foreign Currency), Affirmed NP
ST Counterparty Risk Rating (Local Currency), Affirmed NP
LT Counterparty Risk Rating (Foreign Currency), Affirmed Ba1
LT Counterparty Risk Rating (Local Currency), Affirmed Ba1
ST Bank Deposit (Foreign Currency), Affirmed NP
ST Bank Deposit (Local Currency), Affirmed NP
LT Bank Deposit (Foreign Currency), Affirmed Ba2, Stable
LT Bank Deposit (Local Currency), Affirmed Ba2. Stable
Outlook Actions:
Issuer: Banco Alfa de Investimento S.A.
Outlook, Remains Stable
GREAT PANTHER: Court Converts NOI Proceedings to CCAA Proceedings
-----------------------------------------------------------------
Great Panther Mining Limited disclosed that on October 4, 2022, the
Supreme Court of British Columbia pronounced an initial order (the
"Initial Order") converting the Company's restructuring proceedings
under the Bankruptcy and Insolvency Act (Canada) (the "NOI
Proceedings") to the more flexible restructuring proceedings under
the Companies' Creditors Arrangement Act (Canada) ("CCAA"). Similar
to the stay of proceedings granted in the NOI Proceedings, the
Initial Order prevents creditors from enforcing against the Company
up to and including October 14, 2022 (the "Stay"), on which date
the Company will return before the Court to seek, among other
things, an extension to the Stay. The Initial Order also approved
an agreement between the Company and Asahi Refining Canada Ltd.
("Asahi") pursuant to which Asahi will continue to provide refining
services to the Company (the "Asahi Agreement"). The Company's
management is of the view that the Asahi Agreement will avoid the
potential disruption of seeking a new refiner and will assist in
maintaining the timely sale of gold from its indirectly owned mine,
increasing the funds available to support the Company and its
operations during these proceedings.
About Great Panther
Great Panther Mining (TSX: GPR) (OTCPK: GPLDK) is a precious metals
producer focused on the operation of the Tucano Gold Mine in Brazil
where the Company controls a land package covering nearly 200,000
hectares in the prospective Vila Nova Greenstone belt.
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C H I L E
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LATAM AIRLINES: Banks Sweeten Bond Prices Needed for Bankr. Exit
----------------------------------------------------------------
Lisa Lee and Paula Seligson of Bloomberg News report that banks
leading the bankruptcy exit financing for Latam Airlines Group SA
are sweetening the price on $1.5 billion of high-yield bonds amid
tepid investor demand.
JPMorgan Chase & Co. is proposing an all-in yield in the range of
14% to 15% on the debt from an initial price talk of around 13%,
according to people familiar with the matter. The original issue
discount has been lowered to 93 cents on the dollar, according to
the people, who asked not to be named discussing private
information.
About LATAM Airlines Group
LATAM Airlines Group S.A. -- http://www.latam.com/-- is a
pan-Latin American airline holding company involved in the
transportation of passengers and cargo and operates as one unified
business enterprise. It is the largest passenger airline in South
America.
Before the onset of the COVID-19 pandemic, LATAM offered passenger
transport services to 145 different destinations in 26 countries,
including domestic flights in Argentina, Brazil, Chile, Colombia,
Ecuador and Peru, and international services within Latin America
as well as to Europe, the United States, the Caribbean, Oceania,
Asia and Africa.
LATAM and its 28 affiliates sought Chapter 11 protection (Bankr.
S.D.N.Y. Lead Case No. 20-11254) on May 25, 2020. Affiliates in
Chile, Peru, Colombia, Ecuador and the United States are part of
the Chapter 11 filing.
The Debtors disclosed $21,087,806,000 in total assets and
$17,958,629,000 in total liabilities as of Dec. 31, 2019.
The Hon. James L. Garrity, Jr., is the case judge.
The Debtors tapped Cleary Gottlieb Steen & Hamilton LLP as
bankruptcy counsel, FTI Consulting as restructuring advisor, Lee
Brock Camargo Advogados as local Brazilian litigation counsel, and
Togut, Segal & Segal LLP and Claro & Cia in Chile as special
counsel. The Boston Consulting Group, Inc. and The Boston
Consulting Group UK LLP serve as the Debtors' strategic advisors.
Prime Clerk LLC is the claims agent.
The official committee of unsecured creditors formed in the case
tapped Dechert LLP as its bankruptcy counsel, Klestadt Winters
Jureller Southard & Stevens, LLP as conflicts counsel, UBS
Securities LLC as investment banker, and Conway MacKenzie, LLC as
financial advisor. Ferro Castro Neves Daltro & Gomide Advogados is
the committee's Brazilian counsel.
The Ad Hoc Group of LATAM Bondholders tapped White & Case LLP as
counsel.
Glenn Agre Bergman & Fuentes, LLP, led by managing partner Andrew
Glenn and partner Shai Schmidt, has been retained as counsel to the
Ad Hoc Committee of Shareholders.
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D O M I N I C A N R E P U B L I C
===================================
DOMINICAN REPUBLIC: Peso Appreciates by 8.75% Against the Dollar
----------------------------------------------------------------
Dominican Today reports that when comparing the price of the US
currency in July 2020 with September 2022, the Dominican peso has
appreciated by 8.75% (RD$5.0968), while the average exchange rate
for sale decreased from RD$58.2693 to RD$53.5243.
27 months have passed throughout this time, and with very few
exceptions, the foreign exchange market has only slightly moved in
the other direction, according to Dominican Today.
Why is the dollar weakening versus the peso at a time when it is
strengthening against the euro and other currencies in Latin
America? Is this a result of the Central Bank's stringent monetary
policy, or are there other forces at play? Is it a result of the
remittance inflow, which is still more than it was before the
pandemic?
While this is going on, the monetary authorities are increasing the
policy rate once more by 25 basis points, bringing it from 8.00% to
8.25% annually, the report notes.
This increase in the value of the peso relative to the dollar comes
after the price of the US currency increased 9.08% in the first
half of 2020, rising from an average of RD$53.0417 in January to
RD$58.2693 in July, which is equivalent to RD$4.8152 in absolute
terms, the report relays.
Since the dollar is currently trading at nearly the same level as
it did in January 2020, the peso has gained back the ground it lost
during this time, the report notes.
The Dominican peso has appreciated 4.34% in the first five months
of this year, or since the price against the greenback rose from
RD$57.5240 to RD$55.0592, which may be the time when the peso's
appreciation against the dollar has been felt the most, the report
discloses.
The dollar's value versus the peso has decreased by RD$3.28 since
May, or 3.11%, the report says. The peso has increased 7.45% so
far this year, translating to a net loss of RD$4.3083 for the
dollar relative to the Dominican peso, the report notes.
The Central Bank of the Dominican Republic (BCRD) points out that
between January and August 2022, remittances received totaled
US$6,518.8 million, exceeding the US$1,792.8 million received in
the first eight months of 2019, the time frame before the start of
the covidio-19 pandemic, the report relays. This coincides with
the Dominican peso's appreciation against the dollar, 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.
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G U Y A N A
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RAMPS LOGISTICS: Unit Slapped With Charges in Guyana
----------------------------------------------------
Trinidad Express reports that five days after Ramps Logistics
Guyana filed an application for Judicial Review against the Local
Content Secretariat, it was slapped with ten charges of false
declarations by the Law Enforcement and Investigations Division
(LEID) of the Guyana Revenue Authority (GRA).
Ramps Logistics Guyana is a subsidiary of Trinidad owned Ramps
Logistics.
Oil Now Guyana reported that the GRA instituted ten charges in the
Georgetown Magistrates' Court against Ramps Logistics (Guyana) Inc
for false declarations, according to Trinidad Express.
According to the documents filed by the GRA, it determined, among
others, that during the period of 2021 to 2022, Ramps made several
untrue declarations to the revenue authority, the report notes.
It said the move to the courts is in keeping with its mandate to
ensure there is a "level playing field" for legitimate businesses
and the collection of revenue, the report relays.
GRA also called for individuals/companies involved in any such
illicit activities to cease and desist there from and bring their
businesses into compliance with the nation's Tax, Trade and Border
laws, Oil Now Guyana reported, the report relays.
Oil Now Guyana said the GRA has also been probing Ramps Logistics
Guyana for abusing blanket tax waivers granted for the importation
of goods to be used by Stabroek Block operator, Esso Exploration
and Production Guyana Limited (EEPGL), and its subcontractors, the
report discloses.
"A report by the division cited a case on December 13, 2019, when
it checked a shipment of goods consigned to EEPGL and Ramps
Logistics Incorporated was listed as the declarant. The LEID
report reads, 'The said declaration was deemed false since the
quantity of the goods declared was inconsistent with the
information stated on the invoice," the report notes.
"The said act constituted a breach of Sections 217 (1) (a) and 219
of the Customs Act, Chapter 82:01, respectively. In the said
matter, the Commissioner General (Godfrey Statia) in accordance
with Section 271 of the Customs Act, Chapter 82:01, invoked his
discretionary power and waived the proposed compensation of
$500,000 for the acts committed," the report said, Trinidad Express
relays.
Ramps CEO: Charges to be reviewed
Trinidad Express discloses that in a swift rebuttal, chief
executive of Ramps Logistics Shaun Rampersad, who is also chairman
of Ramps Guyana, told the Express that the charges would be
reviewed by the company's lawyers and offered a timeline of events
as follows:
"Every declaration filed by the GRA is in respect to Duty Free
importations. There are no taxes or duties applicable on the
imports and so there is no loss of Revenue to the GRA.
1. July 12, 2022-The GRA wrote to RLG informing them of an
investigation into alleged false declarations.
2. July 25, 2022-RLG's Lawyers wrote the GRA responding on why the
allegations raised by the GRA had no basis in law and clearly
outlined the sections of the Guyana Customs Act that they relied on
to form this opinion.
3. September 29, 2022-eight weeks later the GRA responds to RLG.
Their response does not address any of the legal points raised by
RLG's Lawyers.
4. September 30, 2022-RLG files for Judicial Review against the
Local Content Secretariat.
5. October 5, 2022 - GRA issues a Press Release to say they are
filing charges against RLG for False declarations."
"We have always respected the laws of every country we operate in
and have always been transparent in everything we do. We will
continue to operate with the highest levels of integrity. We
continue to be committed to Guyana and hope for a fair and speedy
resolution of this situation," he said, the report notes.
Denied Local Content Certificate
In June, Ramps Guyana was denied a Local Content Certificate by the
Guyana's Local Secretariat.
In July, it re-submitted an application.
But with its five-year contract with Exxon Mobil, an American
multinational and one of the world's largest publicly traded oil
and gas company, due to end November 2022, and no certificate
forthcoming despite addressing the secretariat's concern, the
company filed for judicial review, the report relays.
"While we wish we could have settled this matter out of court, now
that it is in court we are confident about the judicial system in
Guyana and we look forward to our judicial review hearing on
October 20. Guyana is a lovely country with beautiful people and we
look forward to building a bigger, better business with our 400
plus employees and partners in Guyana," Rampersad said, the report
notes.
At a news conference in June, Rampersad had said no reason had been
forthcoming as to why it was denied certification since it met all
the requirements outlined by the Act and his lawyers subsequently
wrote to the Secretariat seeking reasons for their denial, the
report discloses.
"From the initial look of the letter, it doesn't look like anything
unreasonable. They have made some demands of us. From what I have
seen, they are not unreasonable and we are very committed to
working with them to have this resolved. I am hopeful we can have
this sorted out," Rampersad had told the Express at the time.
Background info
A Local Content Certificate is essential for the company to operate
in Guyana.
The Local Content Act was passed in Guyana in December 2021 to
encourage development and greater participation for Guyanese
nationals in the petroleum industry, the report relays.
Among the requirements for certification was that the company had
to be registered in Guyana, have 90 per cent of its employees from
Guyana, 75 per cent of its management team to be Guyanese nationals
and that it must be 51 per cent owned by a Guyanase national, the
report discloses.
Rampersad sold 51 per cent of Ramps Guyana to Deepak Lall, a friend
and businessman, a Trinidad born, now naturalized Guyanese citizen
this year, the report says.
Lall's birth was registered in Guyana in June 2021. His Guyanese
passport was issued on September 9, 2021.
Lall, a mechanical engineer, is the managing director of the Point
Lisas-based Qualitech Machining Services Ltd, a machining services,
engineering sales and service and project delivery provider in the
Caribbean, the report relays.
He became a shareholder at Ramps Logistics Guyana on March 9 2022,
acquiring 51 per cent of the company in newly issued shares, for
US$1 million, the report notes.
Lall had told the Sunday Express that as part of the wider
diaspora, it was an entry to contribute to the country.
Ramps Logistics, a family owned business from Cunupia, expanded
into Guyana into 2013, and set up a subsidiary company, Ramps
Logistics Guyana, the report relays.
In 2017, Ramps Logistics Guyana was awarded a five year logistics
contract for ExxonMobil to coordinate its operations in Guyana.
Since then, Exxon's has had 31 oil discoveries in its Stabroek
block, the report notes.
In April, the company announced that it found oil in three new
wells raising recoverable oil and gas potential from its
discoveries to nearly 11 billion barrels, the report adds.
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S T . V I N C E N T A N D T H E G R E N A D I N E S
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ST. VINCENT & THE GRENADINES: To Get Oil Under PetroCaribe Deal
---------------------------------------------------------------
RJR News reports that St. Vincent is to receive approximately
23,000 barrels of oil by the end of October under Venezuela's
PetroCaribe agreement.
Prime Minister Dr. Ralph Gonsalves told a news conference that the
logistics regarding the importation of the oil are still being
worked out with the St. Vincent Electricity Services regarding
storage capacity, according to RJR News.
In April, Dr Gonsalves said Caracas had agreed to cancel St Vincent
and the Grenadines' debt under PetroCaribe, its oil initiative with
Latin American and Caribbean countries, the report notes. He said
this could result in the national debt declining by nine per cent,
the report relays.
Dr Gonsalves said Kingstown and Caracas are tallying the precise
size of the debt and that it may be up to US$70 million, or EC$189
million, the report adds.
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X X X X X X X X
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LATAM: Fuel Subsidies Should Target Poor People
-----------------------------------------------
Anthony Wilson at Trinidad Express reports that the World Bank's
chief economist for Latin America and the Caribbean, William
Maloney, said that the Washington, DC-based institution has
calculated that eliminating badly designed transfers, for example
fuel, tightening up on procurement and controlling wage bills can
save countries in the region 17 per cent of their expenditure.
"That implies that two out of three countries in the region can
balance their budgets with those savings," said Maloney, in a Zoom
call with regional journalists in advance of the World Bank's
publication of its Regional Economic Review of Latin America and
the Caribbean, according to Trinidad Express.
Asked to clarify his statement about eliminating badly designed
transfers, Maloney said the Covid-19 pandemic and this year's
global spike in the prices of food and fuel have hit many
low-income families throughout the region very hard, the report
notes.
"Often, what we find in the region is that countries just subsidies
oil prices or fuel prices across the board. That means we are not
only helping out those poor families, we are subsidizing fuel
prices for the entire population, including those who don't need
it," Maloney said, the report relays.
He said the 17-per cent savings from eliminating badly designed
subsidies, procurement reform and controlling wage bills would
include better targeting of transfer interventions and relief
efforts, the report discloses.
"It is not about eliminating all support for families. It is
probably better from an economic point of view to not subsidies
these products directly, but to increase transfers to vulnerable
families. That is probably more efficient from an economic point
of view," Maloney said, the report notes.
In the budget presentation for the 2023 fiscal year, Finance
Minister Colm Imbert raised the price of fuels, as he maintained
that the Government intends to cap subsidies on the commodity at $1
billion in the 2023 fiscal year, the report relays.
Imbert also announced the implementation of a proposal to transfer
$1,000 to some 175,000 vulnerable families to January, the report
says.
Responding to a question on mitigating the impact of higher
inflation on families, Maloney said: "In general, the World Bank
has supported transfers to households to offset rising fuel and
food costs as a more efficient way of supporting poor families than
blanket subsidies," the report discloses.
Earlier in his presentation, Maloney highlighted more effective
public spending as being one of three categories of economic
interventions that countries can make to get more fiscal space, the
report relays.
"We estimate that eliminating losses in badly designed
transfers-for instance, energy, procurement and wage bills-could
save roughly 17 per cent of spending, and that implies that two out
of three countries in the region can balance their budgets with
those savings," said Maloney, the report notes.
He said the World Bank sees working on more effective public
spending as being a gateway to modernizing the State and
-increasing public trust, the report relays.
The other two interventions are maintaining or increasing capital
expenditures and the inflationary erosion of some transfers
particularly pensions.
The impact of inflation on pensions "tends to be regressive, as
many pensioners are not particularly well off. It is also
recessive because these people spend all of their money," said
Maloney, the report says.
He said renewed headwinds, including the war in Ukraine, higher
interest rates and slower growth in advanced countries, have caused
the World Bank to revise downwards its growth outlook for Latin
America and the Caribbean in 2023 to 1.6 per cent from an earlier
projection of 2.3 per cent, the report adds.
[*] BOND PRICING: For the Week Oct. 3 to Oct. 7, 2022
-----------------------------------------------------
Issuer Name Cpn Price Maturity Country Curr
----------- --- ----- -------- ------- ---
Noble Holding Internat 5.3 60.5 3/15/2042 KY USD
Metrogas SA/Chile 6.0 41.6 8/1/2024 CL CLP
City of Cordoba Argent 7.9 73.1 9/29/2024 AR USD
Argentine Republic Gov 8.3 72.9 12/31/2033 AR USD
Argentine Republic Gov 7.1 75.7 6/28/2117 AR USD
AES Tiete Energia SA 6.8 1.2 4/15/2024 BR BRL
Automotores Gildemeist 6.8 54.9 1/15/2023 CL USD
Province of Santa Fe 6.9 75.2 11/1/2027 AR USD
Argentine Republic Gov 4.3 70.0 12/31/2033 AR JPY
Provincia de Cordoba 7.1 72.7 8/1/2027 AR USD
Argentina Bonar Bonds 5.8 75.2 4/18/2025 AR USD
Provincia de Rio Negro 7.8 70.3 12/7/2025 AR USD
Avadel Finance Cayman 4.5 55.0 2/1/2023 US USD
Esval SA 3.5 49.9 2/15/2026 CL CLP
Noble Holding Internat 6.1 62.0 3/1/2041 KY USD
Cia Latinoamericana de 9.5 73.9 7/20/2023 AR USD
Automotores Gildemeist 6.8 54.9 1/15/2023 CL USD
Provincia de Buenos Ai 7.9 75.3 6/15/2027 AR USD
Province of Santa Fe 6.9 74.7 11/1/2027 AR USD
Cia Latinoamericana de 9.5 74.3 7/20/2023 AR USD
Sylph Ltd 2.4 65.1 9/25/2036 KY USD
Odebrecht Finance Ltd 6.0 16.4 4/5/2023 KY USD
Fospar S/A 6.5 1.2 5/15/2026 BR BRL
Odebrecht Finance Ltd 6.0 16.4 4/5/2023 KY USD
Odebrecht Finance Ltd 6.0 16.4 4/5/2023 KY USD
Provincia de Cordoba 7.1 74.7 8/1/2027 AR USD
Argentine Republic Gov 6.3 74.1 11/9/2047 AR EUR
Argentina Bonar Bonds 7.6 74.4 4/18/2037 AR USD
Province of Santa Fe 6.9 74.7 11/1/2027 AR USD
Argentine Republic Gov 8.3 72.9 12/31/2033 AR USD
Noble Holding Internat 6.2 62.2 8/1/2040 KY USD
Provincia del Chaco Ar 4.0 0.0 12/4/2026 AR USD
Provincia de Rio Negro 7.8 70.4 12/7/2025 AR USD
Argentine Republic Gov 8.3 72.9 12/31/2033 AR USD
Argentine Republic Gov 8.3 74.5 12/31/2033 AR USD
Argentine Republic Gov 0.5 27.6 12/31/2038 AR JPY
Argentine Republic Gov 6.9 75.2 1/11/2048 AR USD
Argentine Republic Gov 8.3 74.5 12/31/2033 AR USD
Provincia del Chubut A 4.5 2208 3/30/2021 AR USD
Province of Santa Fe 6.9 75.2 11/1/2027 AR USD
Provincia del Chaco Ar 9.4 74.8 8/18/2024 AR USD
Provincia de Rio Negro 7.8 70.3 12/7/2025 AR USD
*********
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
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USA, Marites O. Claro, Joy A. Agravante, Rousel Elaine T.
Fernandez, Julie Anne L. Toledo, Ivy B. Magdadaro, and Peter A.
Chapman, Editors.
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