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250703.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 Thursday, July 3, 2025, Vol. 26, No. 132 Headlines A R G E N T I N A ARGENTINA: Crop Traders Rush to Secure Cargoes as Milei Perk Ends TELECOM ARGENTINA: Fitch Affirms 'B-/B' LongTerm IDRs B A R B A D O S BARBADOS: Fitch Assigns 'B+' Rating on $500MM Unsec. Notes Due 2035 B R A Z I L BRAZIL: Fitch Affirms 'BB' LongTerm Foreign Currency IDR J A M A I C A [] JAMAICA: IMF Praises Country for Sound Macroeconomic Policies P A R A G U A Y PARAGUAY: Economy Remains Resilient, IMF Says P U E R T O R I C O AMBASSADOR VETERANS: Section 341 Creditors Meeting Set for July 22 ANCHOR FUNDING: Case Summary & Three Unsecured Creditors T R I N I D A D A N D T O B A G O TRINIDAD & TOBAGO: CSO Inflation Dips in May TRINIDAD & TOBAGO: Energy Sector Shows Mixed Performance in Q1 X X X X X X X X LATAM: New IDB Program Empowers Local Govts with Funding Access - - - - - ================= A R G E N T I N A ================= ARGENTINA: Crop Traders Rush to Secure Cargoes as Milei Perk Ends ----------------------------------------------------------------- Jonathan Gilbert & Ignacio Olivera Doll at Bloomberg News report that agriculture traders in Argentina are rushing to get crop shipments on the books before President Javier Milei's tariff relief expires. Trading houses, which must procure licences for their future cargoes by listing them on a government register, are notching the biggest volumes of soy and corn since Milei temporarily reduced export tariffs at the beginning of the year, according to Bloomberg News. The move was in part designed to help farmers struggling to turn a profit amid low global prices, and in part to bring forward inflows of dollars to the central bank as Milei seeks to stabilise the economy ahead of midterm elections in October, Bloomberg News notes. Milei slashed tariffs on exports of soy meal and soy oil to 24.5 percent from 31 percent until June 30, Bloomberg News relays. Argentina is the world's biggest supplier of both commodities, the report discloses. For corn, the rate is currently 9.5 percent and is set to return to 12 percent, Bloomberg News notes. Under the tariff-relief guidelines, exporters must bring nearly all the dollars that cargoes are worth into Argentina almost as soon as they're listed on the register – even though many won't be loaded at port for several weeks, Bloomberg News relays. Normally, they can do that after cargoes have sailed, Bloomberg News says. As deadline approaches, the export register known as DJVE is seeing a flurry of activity, Bloomberg News relays. Traders including Bunge Global SA, Cargill Inc and Louis Dreyfus Co. BV were granted soy and corn licences alone for more than 2.5 million metric tons, the most daily since relief started January 27, Bloomberg News notes. June has seen the most crop cargoes listed on the register of any month since December 2023, when Milei came to power and devalued the currency in a boost for exporters, according to Javier Preciado Patino, a farming consultant who served as Argentina's head of agriculture markets from 2019 to 2022, Bloomberg News recalls. Of course, exporters need supplies to fulfil the shipments. Farmers who are finishing up the soy harvest locked in sales of their crop at the quickest clip yet this season on June 24 and 25, data from the Rosario Board of Trade show, Bloomberg News notes. The years-long export tariffs are loathed by farmers since they eat into their ability to reinvest and grow production. Agriculture groups have been lobbying for the relief to be extended, Bloomberg News says. Milei campaigned on a vow to scrap the tariffs, but his priority is building budget surpluses and since they rake in billions of dollars a year he can't afford to, Bloomberg News relays. Ariel Striglio, a farmer in Santa Fe Province, sold only slightly more of his harvest than normal over the last few weeks in a bet that Milei will resume relief. "At some point, the government is going to have to do what it said it would," he said. "I hope the rates will stay as they are and even go down more next year," he added. About Argentina Argentina is a country located mostly in the southern half of South America. Its capital is Buenos Aires. Javier Milei is the current president of Argentina after winning the November 19, 2023 general election. He succeeded Alberto Angel Fernandez 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. In March 2022, the International Monetary Fund (IMF) approved a 30-month arrangement under an Extended Fund Facility for Argentina in the amount of SDR 31.914 billion (equivalent to US$44 billion, or 1000 percent of quota) -- with an approved immediate disbursement of an equivalent of US$9.65 billion. Argentina's IMF-supported program sought to improve public finances and start to reduce persistent high inflation through a multi-pronged strategy. On April 11, 2025, the IMF further approved a 48-month Extended Fund Facility (EFF) arrangement for Argentina totaling US$20 billion (or 479 percent of quota), with an immediate disbursement of US$12 billion, and a first review planned for June 2025 with an associated disbursement of about US$2 billion. The program is expected to help catalyze additional official multilateral and bilateral support, and a timely re-access to international capital markets. Fitch Ratings, on May 12, 2025, upgraded Argentina's Long-Term Foreign-Currency and Local-Currency Issuer Default Rating (IDR) to 'CCC+' from 'CCC'. The upgrade reflects the launch of a new IMF program, among other things. S&P Global Ratings, in February 2025 lowered its local currency sovereign credit ratings on Argentina to 'SD/SD' from 'CCC/C' and its national scale rating to 'SD' from 'raB+'. Moody's Ratings, in January 2025, raised Argentina's local currency ceiling to B3 from Caa1 and the foreign currency ceiling to Caa1 from Caa3. DBRS, Inc. upgraded Argentina's Long-Term Foreign and Local Currency Issuer Ratings to B (low) from CCC in November 2024. TELECOM ARGENTINA: Fitch Affirms 'B-/B' LongTerm IDRs ----------------------------------------------------- Fitch Ratings has affirmed Telecom Argentina S.A.'s (Telecom) ratings, including its Long-Term Foreign Currency Issuer Default Rating (IDR) at 'B-', Long-Term Local Currency IDR at 'B', and senior unsecured notes at 'B' with a Recovery Rating of 'RR3'. The Rating Outlook is Stable. Telecom's ratings reflect Fitch's expectation that the company will continue mitigating inflationary pressures while maintaining its strong market position and solid credit profile. Despite macroeconomic instability in Argentina, where the majority of its operations and assets are located, Telecom has historically managed to pass most inflation effects on to consumers, alleviating some macroeconomic risks. Telecom's robust financial and operational profile is supported by strong cash flow generation, a relatively conservative capital structure, and competitive strengths in both fixed and mobile services. The acquisition of Telefonica Moviles Argentina's (TMA) operation will consolidate Telecom's market position, improve network quality and reduce competition, with minimal impact on its financial structure. Key Rating Drivers Country Ceiling Limits FC Ratings: Telecom's Long-Term Foreign Currency IDR is limited by Argentina's 'B-' Country Ceiling. Fitch believes any default by the company would likely stem from transfer and convertibility restrictions rather than a significant decline in operational performance. Strong Operator, Weak Operating Environment: Telecom is the leading integrated operator in the country, with strong competitive positions in both fixed and mobile services. The company's robust product offerings and brand recognition bolster its ability to generate strong cash flow. Historically, Telecom has managed the volatile macroeconomic environment by adjusting service prices to counteract rising operational costs, thus maintaining solid credit metrics. As Fitch anticipated, the appreciation of the peso in real terms in 2024 has allowed leverage to return to its long-term trend, with net leverage reaching 2.1x. Acquisition of TMA: Ratings were unaffected by the acquisition of TMA. Fitch projects a limited impact on net leverage, estimated at 2.0x in 2025. The acquisition cost was USD1.24 billion, financed with USD1.17 billion in bank loans, with no further debt added by TMA. The purchase will strengthen Telecom's market position, expanding mobile and fixed broadband shares to about 58% and 46%, respectively. Management expects synergies in opex, as well as capex optimization, especially for fiber to the home (FTTH) development. The acquisition was challenged by the antitrust authority due to concentration issues, and a final decision is pending on Telecom's proposed remedies. Solid Financial Profile: Telecom's financial structure is among the strongest of Fitch-rated telecom companies in the region, characterized by a conservative capital structure and strong cash flow generation. Fitch projects the company's net debt/EBITDA ratio will remain below 2.0x over the rating horizon, aligning with stronger investment-grade operators in the region. Positive FCF Expected: Fitch expects positive free cash flow (FCF) generation in the medium term, reaching an FCF margin of around 3%, despite a stronger capex intensity of 17% of revenue. This capex is mainly focused on accelerating 5G and FTTH deployment, developing a digital ecosystem for the B2B business, and improving TMA investments to industry standards. FX, Higher ARPUs Boost Performance: A sustained decrease in inflation and the reduction of foreign exchange controls could support improvements in the company's performance. Fitch expects Telecom to continue adjusting prices to mitigate cost inflationary pressures, maintaining an EBITDA margin of around 25% over the rating horizon. Since 2023, Telecom Argentina has increased prices to keep pace with accelerating inflation, although at a slower pace since 4Q24. Peer Analysis The speculative ratings of Telecom compare with Argentine issuers YPF S.A. (CCC+) and Arcor S.A.I.C. (B/Stable), which experience rating constraints from the difficulties of operating in Argentina despite having solid business and capital structures. Arcor's ratings are higher than those of YPF and Telecom because it has operations in Brazil and holds cash abroad in its foreign subsidiaries. Telecom's business and financial profile are similar or superior to regional investment grade telecom companies like Empresa Nacional de Telecomunicaciones S.A. (BBB-/Stable). Telecom also has a similar or stronger capital structure, market position or service diversification than telecoms players rated in the 'BB' range, like Telefónica Móviles Chile S.A (BB-/Negative), Colombia Telecomunicaciones S.A E.S.P. BIC (BB+/Stable), or Empresa de Telecomunicaciones de Bogota (ETB, BB+/RON). Key Assumptions - The company is able to pass on the majority of inflation to consumers each year; - Low-single -digit growth of mobile subscribers and fixed broadband subscribers; - Include the operations of Telefónica Moviles Argentina (10 months in 2025); - EBITDA margins around 24%-25%; - Capital intensity around 17% in the medium term. Recovery Analysis For going concern EBITDA, Fitch assumes Telecom would be unable to pass on a significant portion of Argentina's projected inflation, while the company's expenses would rise with inflation. Under this scenario, EBITDA margins drop significantly to 20%. EBITDA considers the consolidated operation of Telefónica Moviles Argentina S.A. and the debt used to finance its acquisition. Fitch uses a 4x multiple, lower than the average telecom enterprise value/EBITDA multiple of 5x-7x, to apply a discount for Argentine assets. Although Fitch's recovery methodology suggests an 'RR2' Recovery Rating for Telecom, the methodology also applies a standard cap of 'RR4' for instrument ratings in Argentina. Fitch applies country-specific caps to instrument ratings for a given jurisdiction, reflecting its view that average recoveries could be lower in regimes that are debtor-friendly and/or have weak enforceability and higher in regimes that are creditor-friendly and/or have strong enforceability. The caps limit the assignment of higher Recovery Ratings for obligations of issuers that are incorporated or whose assets or cash flows are in less creditor-friendly jurisdictions. However, per Fitch's "Country Specific Treatment of Recovery Criteria," when an issuer enters a distressed or defaulted state, such as Argentina (CCC+), Fitch can assign a higher Recovery Rating to a debt instrument if Fitch believes that recoveries in that particular case will be consistent with a higher Recovery Rating, as Fitch does in this case. Therefore, Fitch has assigned Telecom's senior unsecured notes a Recovery Rating of 'RR3'. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - Telecom Argentina's FC IDR is bound by Argentina's 'B-' Country Ceiling; therefore, a downgrade of the Argentine sovereign rating and concurrent downgrade of the sovereign's Country Ceiling would result in a downgrade. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - Telecom Argentina's FC IDR is bound by Argentina's 'B-' Country Ceiling; therefore, an upgrade of the Argentine sovereign rating and concurrent upgrade of the Argentine Country Ceiling would result in an upgrade; - Telecom Argentina's LC IDR is constrained by the weak Argentine OE; therefore, a decrease in macroeconomic turmoil could result in an upgrade. Liquidity and Debt Structure Telecom maintains sufficient liquidity, with ARS511 billion in cash available and investments against ARS898 billion in short-term debt as of March 2025. The company also possesses ample borrowing capacity in local capital markets. The majority of Telecom's cash and debt is denominated in U.S. dollars. The new unsecured notes for USD800 million were used to partially refinance bank loans for USD1.17 billion used to acquire TMA. At the close of the transaction, TMA had an approximate net cash position of USD350 million. While Telecom has smaller operations outside of Argentina in Paraguay, Uruguay, Chile and the U.S., Fitch does not view these operations as substantial enough to bypass the Argentine Country Ceiling (B-). Telecom's refinancing risk is deemed manageable. The company's liquidity and financial flexibility are bolstered by strong cash flow, which Fitch expects to sufficiently cover capital expenditures. Telecom also has a longstanding track record of refinancing and rolling over bank debt and loans from international agencies, such as the International Finance Corporation. Issuer Profile Telecom is the largest integrated telecommunications services provider in Argentina, offering broadband, pay TV and fixed and mobile telecommunications services throughout the country. The company also has smaller operations in Paraguay, Uruguay, Chile and the U.S. Criteria Variation Fitch has applied a variation from its "Country-Specific Treatment of Recovery Ratings Criteria," specifically the section titled "When an Instrument Enters a Distressed or Defaulted State." The criteria allow a Recovery Rating to be assigned above the defined cap for distressed issuers when Fitch has reason to believe that recoveries in an individual case would be consistent with a higher Recovery Rating. Fitch has extended this analytical approach to all Argentine-based corporates rated 'B-', reflecting their highly speculative credit profiles and their operations within the distressed operating environment in Argentina (CCC+). Summary of Financial Adjustments - Lease Adjustments in EBITDA Calculation MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS Fitch's latest quarterly Global Corporates Macro and Sector Forecasts data file which aggregates key data points used in its credit analysis. Fitch's macroeconomic forecasts, commodity price assumptions, default rate forecasts, sector key performance indicators and sector-level forecasts are among the data items included. ESG Considerations The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' 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. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating Recovery Prior ----------- ------ -------- ----- Telecom Argentina S.A. LT IDR B- Affirmed B- LC LT IDR B Affirmed B senior unsecured LT B Affirmed RR3 B =============== B A R B A D O S =============== BARBADOS: Fitch Assigns 'B+' Rating on $500MM Unsec. Notes Due 2035 ------------------------------------------------------------------- Fitch Ratings has assigned Barbados's USD500 million notes maturing June 2035 a 'B+' rating. The notes have a coupon rate of 8.0% and principal payments will be paid in semi-annual installments during the last five years before final maturity. They include a natural disaster clause and, for the first time, a pandemic clause, which allow for the deferral of interest and principal payments for up to two years after the occurrence of a qualifying event. A deferral cannot extend the final maturity of the notes. Proceeds from this issuance will be used for liability management, including funding a tender offer of the 6.5% 2029 notes and repaying its International Monetary Fund debt. Key Rating Drivers The rating is in line with Barbados's Long-Term Foreign-Currency Issuer Default Rating (IDR). On Oct. 15, 2024, Fitch upgraded Barbados's Long-Term Foreign-Currency IDR to 'B+' with a Stable Outlook. The following ESG issues represent Key Rating Drivers for the bonds. Other Key Rating Drivers can be found in the issuer rating action commentary dated Oct. 15, 2024. ESG - Governance: Barbados has an ESG Relevance Score (RS) of '5[+]' for both Political Stability and Rights and for the Rule of Law, Institutional and Regulatory Quality and Control of Corruption. Theses scores reflect the high weight that the World Bank Governance Indicators (WBGI) have in its proprietary Sovereign Rating Model. Barbados has a high WBGI ranking at 77th percentile, reflecting its long track record of stable and peaceful political transitions, well established rights for participation in the political process, strong institutional capacity, effective rule of law, and a low level of corruption. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - Public Finances: Emergence of financing constraints; for example, due to a deterioration in relations with international financial institutions or fiscal deterioration; - External Finances: An external shock that leads to a sharp reduction in external liquidity. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - Public Finances: Preservation of high primary surpluses that lead to a continued sharp reduction in the government debt-to-GDP ratio. - Public Finances: Demonstration of improving access to financing sources beyond multilaterals. For example, through a reopening of the domestic debt market. - Macro: Progress on economic reforms that improve the outlook for investment and trend growth. Date of Relevant Committee Oct 14, 2024 ESG Considerations The ESG profile is in line with that of Barbados. Entity/Debt Rating ----------- ------ Barbados senior unsecured LT B+ New Rating =========== B R A Z I L =========== BRAZIL: Fitch Affirms 'BB' LongTerm Foreign Currency IDR -------------------------------------------------------- Fitch Ratings has affirmed Brazil's Long-Term Foreign Currency Issuer Default Rating (IDR) at 'BB'. The Rating Outlook is Stable. Key Rating Drivers Credit Fundamentals: Brazil's ratings are supported by its large, diverse economy and strong external finances, which offer resilience to shocks, and deep local markets supporting sovereign financing flexibility and a low foreign currency debt share. The ratings are constrained by high and rising government debt/GDP, budgetary rigidities, low governance scores, and relatively low potential growth. Fiscal uncertainties remain a source of broader macroeconomic risk, having manifested in recent market volatility, and prospects for structural reforms to address the underlying imbalances are unlikely to become clearer until after elections in 2026. Fiscal Risks Rattle Markets: The federal primary deficit fell to 0.4% of GDP in 2024 from 2.4% in 2023, largely reflecting timing issues related to court-ordered payments (precatorios) and one-off revenues rather than a strong structural improvement. The Lula administration faces growing congressional resistance to tax increases, while administrative tax efforts have disappointed and spending pressures remain high. A fiscal package presented in late 2024 to address these structural issues aggravated rather than allayed uncertainties, prompting market volatility. Markets have calmed in 2025 despite new fiscal uncertainties relating to compensatory measures for reversal of a hike in the financial transactions tax (IOF), which faced a legislative backlash, and a pledged hike in the personal income tax exemption threshold. Fitch expects that the authorities will deliver a 0.6% of GDP primary deficit (the maximum permitted by the fiscal rule given a 0% target, 0.25pp tolerance band and 0.35pp let-out for precatorios), with likely recourse to stopgap measures should tax efforts fall short. Interest costs are not covered by fiscal rules and are set to surge this year due to monetary tightening. Fitch projects this will increase the general government deficit (including federal and subnational governments, excluding the central bank) to 8.0% of GDP from 6.6% in 2024. Acute Spending Rigidities: Achieving the fiscal target in 2026 will be challenging, as elections hinder appetite for stopgap measures and increase appetite for spending hikes. There is growing recognition across the political spectrum that durable consolidation will eventually require reforms to curtail growth in entitlement spending, which is squeezing out room for discretionary spending, amid fatigue around further tax increases. Prospects for such action are only likely to become clearer after the 2026 elections. Climbing Debt: The treasury has successfully financed its wide deficits predominantly through the deep local market, although this has involved greater reliance on floating-rate bonds (now nearly half the total) amid macro uncertainties. A large cash cushion (7.5% of GDP as of April) has helped it ride out recent volatility. General government debt rose to 76.5% of GDP in 2024 from 73.8% in 2023, avoiding an even larger jump due to unwinding of repos (which use treasuries as collateral) by the central bank (BCB) made possible by its FX reserve sales. Fitch expects debt to reach 79.3% in 2025 and remain on a steep upward path of around 3pp per year, diverging from the 'BB' median of 53%. Resilient Growth: Fitch expects real GDP growth of 2.5% in 2025, down from 3.4% in 2024 due to tight monetary conditions and the end of fiscal impulse, but up from its prior projections considering signs of still-strong momentum early in the year. The tariff-induced global slowdown should only pose a moderate drag for Brazil, given its low exposure to the U.S. and still-favorable commodity prices. Fitch expects growth to converge to a trend pace of around 2% thereafter. A landmark consumption tax reform passed under the Lula administration could offer upside to potential growth, though Fitch expects this might take time to emerge given a long transition period. Monetary Tightening Concludes: Strong domestic demand has rekindled inflation in the past year, lifting the headline print to 5.3% in May from 3.9% a year earlier, with particularly strong pressure among core services. In response, the BCB has lifted its policy rate by 450 bp to 15.0% as of June, signaling it will maintain this restrictive level until convergence of inflation to the 3% target becomes clearer. While monetary transmission remains strong, several factors could require especially tight monetary policy to cool demand and price pressures, including still-prevalent directed credit, fintech's rapid growth, and fiscal uncertainties. A recent expansion of access to payroll-deduction credit, while microeconomically positive, may have an additional pro-cyclical macroeconomic effect. Strong External Position: Strong domestic demand lifted the current-account deficit (CAD) to 2.8% of GDP in 2024 from 1.3% in 2023, and Fitch expects it to remain at a similar level in 2025. Robust inflows of foreign direct investment continue to fully fund the moderate CAD. The BRL has seen significant volatility in the past year despite the favorable external position, as fiscal uncertainties triggered capital outflows, primarily from non-residents. The BCB intervened substantially in FX markets to manage the volatility in late 2024, using around 10% of its reserves, which Fitch expects it to partially recoup. Reserves offer ample coverage of current external payments (eight months), but a more moderate 15% of broad money, signaling less ample ammunition to manage confidence shocks. Elections Come into Focus: Executive-legislative relations have yielded important recent achievements, such as the consumption tax reform, but have become tense around fiscal measures and budget earmarks allocated to congress. The upcoming October 2026 elections could increase incentives for populist policies, particularly in light of a decline in the Lula administration's approval ratings, such as already announced utilities subsidies and possible increases in social benefits as seen in the last election cycle. Elections do not pose a risk of major economic policy deviations, in its view, but could shape market sentiment and prospects for fiscal reforms crucial to the economic outlook. ESG - Governance: Brazil has an ESG Relevance Score (RS) of '5' for both Political Stability and Rights and for the Rule of Law, Institutional and Regulatory Quality and Control of Corruption. These scores reflect the high weight that the World Bank Governance Indicators (WBGI) have in its proprietary Sovereign Rating Model. Brazil has a medium WBGI ranking at the 40th percentile, reflecting a record of political tension, but peaceful political transitions, a moderate level of rights for participation in the political process, moderate institutional capacity, moderate rule of law and a relatively high level of corruption. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - Public Finances: Material policy shifts that undermine fiscal policy credibility, financing flexibility, and medium-term public debt sustainability; - Macro: Policies that undermine macroeconomic stability and/or medium-term growth prospects. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - Public Finances: Progress on fiscal consolidation that durably stabilizes government debt/GDP; - Macro: Evidence of an improvement in investment and economic growth prospects in the context of macroeconomic stability and improved governance. Sovereign Rating Model (SRM) and Qualitative Overlay (QO) Fitch's proprietary SRM assigns Brazil a score equivalent to a rating of 'BBB-' on the Long-Term Foreign Currency IDR scale. Fitch's sovereign rating committee adjusted the output from the SRM to arrive at the final Long-Term Foreign Currency IDR by applying its qualitative overlay (QO), relative to SRM data and output, as follows: - Macro: -1 notch to reflect relatively weak potential growth, largely held back by a low investment rate and structural impediments, such as a difficult business environment, which make it more challenging to consolidate public finances and address social pressure. - Public Finances: -1 notch to reflect fiscal flexibility that is hampered by the highly rigid spending profile and heavy tax burden, which complicates adjustment to economic shocks, and high debt that Fitch projects to rise further over the medium term. Fitch's SRM is the agency's proprietary multiple regression rating model that employs 18 variables based on three-year centered averages, including one year of forecasts, to produce a score equivalent to a Long-Term Foreign Currency IDR. Fitch's QO is a forward-looking qualitative framework designed to allow for adjustment to the SRM output to assign the final rating, reflecting factors within its criteria that are not fully quantifiable and/or not fully reflected in the SRM. Country Ceiling The Country Ceiling for Brazil is one notch above the Long-Term Foreign Currency IDR. This reflects moderate constraints and incentives, relative to the IDR, against capital or exchange controls being imposed that would prevent or significantly impede the private sector from converting local currency into foreign currency and transferring the proceeds to non-resident creditors to service debt payments. Fitch's Country Ceiling Model produced a starting point uplift of +0 notches above the IDR. Fitch's rating committee applied a +1 notch qualitative adjustment to this, under the Balance of Payments Restrictions pillar to reflect Brazil's relatively open capital account, and ongoing efforts to make the currency fully convertible, that are not reflected by the high number of capital-account restrictions recorded in the IMF's AREAER report that feed into the model score. ESG Considerations Brazil has an ESG Relevance Score of '5' for Political Stability and Rights as WBGIs have the highest weight in Fitch's SRM and are therefore highly relevant to the rating and a key rating driver with a high weight. As Brazil has a percentile rank below 50 for the respective Governance Indicator, this has a negative impact on the credit profile. Brazil has an ESG Relevance Score of '5' for Rule of Law, Institutional & Regulatory Quality and Control of Corruption as WBGIs have the highest weight in Fitch's SRM and are therefore highly relevant to the rating and a key rating driver with a high weight. As Brazil has a percentile rank below 50 for the respective Governance Indicators, this has a negative impact on the credit profile. Brazil has an ESG Relevance Score of '4+' for Human Rights and Political Freedoms as the Voice and Accountability pillar of the WBGIs is relevant to the rating and a rating driver. As Brazil has a percentile rank above 50 for the respective Governance Indicator, this has a positive impact on the credit profile. Brazil has an ESG Relevance Score of '4+' for Creditor Rights as willingness to service and repay debt is relevant to the rating and is a rating driver for Brazil, as for all sovereigns. As Brazil has track record of 20+ years without a restructuring of public debt and captured in Fitch's SRM variable, this has a positive impact on the credit profile. The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' 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. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating Prior ----------- ------ ----- Brazil LT IDR BB Affirmed BB ST IDR B Affirmed B LC LT IDR BB Affirmed BB LC ST IDR B Affirmed B Country Ceiling BB+ Affirmed BB+ senior unsecured LT BB Affirmed BB Senior Unsecured-Local currency LT BB Affirmed BB ============= J A M A I C A ============= [] JAMAICA: IMF Praises Country for Sound Macroeconomic Policies ---------------------------------------------------------------- RJR News reports that the Executive Board of the International Monetary Fund said for more than a decade, Jamaica has been implementing sound macroeconomic policies supported by strong policy frameworks. The board, which concluded the 2025 Article 4 consultation with Jamaica, said these efforts have allowed the country to accumulate meaningful policy buffers, reduce public debt and anchor inflation and improve its external position, according to RJR News. About Jamaica Jamaica is an island country situated in the Caribbean Sea. Jamaica is an upper-middle income country with an economy heavily dependent on tourism. Other major sectors of the Jamaican economy include agriculture, mining, manufacturing, petroleum refining, financial and insurance services. On Feb. 21, 2025, Fitch Ratings affirmed Jamaica's Long-Term Foreign-Currency Issuer Default Rating (IDR) at 'BB-', with a positive rating outlook. In October 2023, Moody's upgraded the Government of Jamaica's long-term issuer and senior unsecured ratings to B1 from B2, and senior unsecured shelf rating to (P)B1 from (P)B2. The outlook has been changed to positive from stable. In September 2024, S&P affirmed 'BB-/B' longterm foreign and local currency sovereign credit ratings on Jamaica and revised outlook to positive. =============== P A R A G U A Y =============== PARAGUAY: Economy Remains Resilient, IMF Says --------------------------------------------- The Executive Board of the International Monetary Fund (IMF) completed the fifth review under the PCI arrangement and the third review under the RSF arrangement. The completion of the reviews provides the authorities with access to approximately US$ 285 million (SDR 211.46 million) under the RSF, of which the authorities have requested disbursement of US$ 195 million (SDR 146 million). The Paraguayan economy remains resilient, with real GDP growing 4.2 percent in 2024. Buoyant private consumption and gross fixed capital formation outweighed a negative contribution from net exports owing mainly to lower electricity production and exports. Economic activity continued its strong momentum in early 2025 with real GDP expected to expand 3.8 percent this year. Headline inflation remains contained within the central bank's tolerance range. Fiscal consolidation is progressing, with the fiscal deficit falling to 2.6 percent of GDP in 2024, down from 4.1 percent in 2023, supported by a substantial increase in tax revenue. The fiscal deficit is projected to decline further to 1.9 percent of GDP in 2025. The current account deficit widened to 3.7 percent of GDP in 2024, from 0.4 percent in 2023, primarily due to lower export revenues, driven in large part by lower soybean prices and a drop in hydroelectricity exports because of low river water levels. Foreign reserves remain comfortably above standard adequacy metrics. At the conclusion of the Executive Board's discussion, Mr. Nigel Clarke, Deputy Managing Director, and Acting Chair, made the following statement: "The Paraguayan economy remains resilient, owing to its strong macroeconomic fundamentals and the authorities' continued prudent macroeconomic management. The outlook is favorable, with growth expected to remain robust, but is subject to elevated global risks and to adverse weather shocks. Against this backdrop, staying the course with prudent macroeconomic management continues to serve as a cornerstone of macroeconomic stability. "With inflation contained within the central bank's tolerance range, monetary policy should remain data driven. The exchange rate should continue to serve as a shock absorber. The banking sector is well capitalized, liquid, and profitable, and the authorities plan to deepen and modernize capital markets. Further strengthening AML/CFT frameworks, including by promptly finalizing the National Risk Assessment, is essential. "The authorities remain resolute in advancing the fiscal consolidation plan, aiming to reduce the deficit to 1.5 percent of GDP by 2026—the ceiling established by the Fiscal Responsibility Law. Efforts to bolster tax revenues and improve the efficiency of public expenditure should continue to support fiscal consolidation goals. "Addressing the sustainability of the public employees' pension fund is essential to mitigate medium-term fiscal risks. The overall risk of sovereign stress is low, and ongoing efforts to gradually decrease the proportion of debt denominated in foreign currency would help further strengthen the risk profile of public debt. "Policy reforms under the Policy Coordination Instrument and the Resilience and Sustainability Facility are further strengthening macroeconomic stability and resilience. Sustained progress on the reform agenda—including continuing efforts to reduce informality, strengthen governance and anti-corruption frameworks, and enhance resilience to natural disasters—will further improve the business environment, boost Paraguay's appeal as an investment destination, and reinforce macroeconomic stability." ===================== P U E R T O R I C O ===================== AMBASSADOR VETERANS: Section 341 Creditors Meeting Set for July 22 ------------------------------------------------------------------ A meeting of creditors under Section 341(a) in the case of Ambassador Veterans Services of Puerto Rico LLC will be held on July 22, 2025, at 2:00 p.m. via Telephonic Conference Information for AUST/Trial Attys. A mee Ambassador Veterans Services of Puerto Rico LLC filed Chapter 11 protection in the U.S. Bankruptcy Court for the District of Puerto Rico. According to court filing, the Debtor reports $4,068,135 in debt owed to 1 and 49 creditors. The petition states funds will be available to unsecured creditors. About Ambassador Veterans Services of Puerto Rico LLC Ambassador Veterans Services of Puerto Rico LLC operates a nursing and intermediate care facility for veterans in Juana Diaz, Puerto Rico. The Company provides residential healthcare services to eligible veterans at its location in Barrio Amuelas. Ambassador Veterans Services of Puerto Rico LLC sought relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D.P.R. Case No. 25-02690) on June 13, 2025. In its petition, the Debtor reports total assets of $2,567,403 and total liabilities of $4,068,135. The Debtors are represented by Javier Vilarino, Esq. at Vilarino and Associates LLC. ANCHOR FUNDING: Case Summary & Three Unsecured Creditors -------------------------------------------------------- Debtor: Anchor Funding, Inc. 1612 Ponce De Leon Ave. San Juan, PR 00909 Business Description: Anchor Funding, Inc. is a financial services firm engaged in credit intermediation activities. Chapter 11 Petition Date: June 23, 2025 Court: United States Bankruptcy Court District of Puerto Rico Case No.: 25-02813 Debtor's Counsel: Alexis Fuentes-Hernandez, Esq. FUENTES LAW OFFICES, LLC P.O. Box 9022726 San Juan PR 00902-2726 Phone: (787) 722-5215 E-mail: fuenteslaw@icloud.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $500,000 to $1 million The petition was signed by Ivan Diaz Lopez as president. A full-text copy of the petition, which includes a list of the Debtor's three unsecured creditors, is available for free on PacerMonitor at: https://www.pacermonitor.com/view/GZTWNAI/ANCHOR_FUNDING_INC__prbke-25-02813__0001.0.pdf?mcid=tGE4TAMA ===================================== T R I N I D A D A N D T O B A G O ===================================== TRINIDAD & TOBAGO: CSO Inflation Dips in May -------------------------------------------- Roberto Codallo at Trinidad and Tobago Guardian reports that the Central Statistical Office has noted a slight dip in the inflation rate, according to the Consumer Price Index for the month of May 2025. In a news release, the CSO said, "The inflation rate for May 2025, which measures the percentage change in the all items index for the month of May 2025 over May 2024, was 1.4 per cent. This represents a decrease from 1.5 per cent for the previous period (April 2025/April 2024). The inflation rate for the comparative period (May 2024/May 2023) was 0.9 per cent," according to Trinidad and Tobago Guardian. The CSO added that according to all-items index' there was a slight increase in prices in May, compared to April, the report notes. The report said, "The all-items index calculated from the prices collected for the month of May 2025 was 125.3, representing an increase of 0.1 point or 0.1 per cent above the all items index for April 2025," the report relays. The report relays that the release continued, "The index for food and non-alcoholic beverages increased from 152.9 in April 2025 to 153.4 in May 2025, reflecting an increase of 0.3 per cent. Contributing significantly to this increase was the general upward movement in the prices of fresh whole chickens, cucumber, pumpkin, table margarine, instant coffee, white flour, oranges, bodi, soya bean oil and full cream milk. However, the full impact of these price increases was offset by the general decrease in the prices of irish potatoes, fresh carite, melongene, onions, ochroes, plantains, fresh king fish, garlic, pimento and frozen whole chicken." The news release closed, "A further review of the data for May 2025 compared with April 2025 reflected decreases in the sub-indices for Alcoholic Beverages and Tobacco of -0.3 per cent, clothing and footwear -0.1 per cent and health of -0.1 per cent. All other sections remained unchanged," the report adds. TRINIDAD & TOBAGO: Energy Sector Shows Mixed Performance in Q1 -------------------------------------------------------------- Trinidad Express reports that Trinidad and Tobago's energy sector showed mixed performance in the first quarter of 2025, with natural gas output declining year-on-year even as crude oil production and select petrochemicals recorded gains, according to the Central Bank. "Data from the Ministry of Energy and Energy Industries pointed to a year-on-year reduction in the production of natural gas (-5.9%) during the first quarter of 2025. Crude oil production improved (6.1%), while the performance of the petrochemical industry was mixed. Expansions in ammonia (4.7%) and urea (12.5%) were countered by a notable decline in methanol output (-15.3%)," the Central Bank stated in its latest Monetary Policy Announcement, according to Trinidad Express. The Central Bank noted that oil prices had spiked due to concerns about supply disruptions stemming from military conflict in the Middle East, the report notes. Brent crude prices reached a high of US$76 per barrel, but subsequently fell below US$70 per barrel following the announcement of a ceasefire, the report relays. "Financial markets nonetheless remain on edge in a very fluid situation. Higher energy prices and a possible escalation of hostilities pose risks for growth and inflation across the world, although energy exporters could benefit from the terms of trade shock," the Central Bank stated, the report says. Locally, the Central Bank reported that while momentum in the non-energy sector appears to be slowing, overall economic activity remains positive, the report notes. "Indicators monitored by the Central Bank suggest that positive performances in the manufacturing, distribution and finance sectors were somewhat offset by sluggishness in the construction and utilities sectors," it stated, the report discloses. The Central Bank stated that inflation remained contained during the review period, the report relays. "Headline inflation, as measured by the Central Statistical Office's Consumer Price Index, rose to 1.4% (year-on-year) in May 2025 from 0.7% in January 2025. Core inflation (which excludes food prices) rose by 0.7%, while food prices increased by 4.1% in May. Food prices have been driven by higher prices for meat and for imported items such as butter, margarine and edible oils," it stated, the report relays. "Meanwhile, building material prices rose by 2.3% (year-on-year) in the first quarter of 2025 compared with 2.5% the previous quarter," the Central Bank stated, the report discloses. According to the Central Bank, on the financial front, credit extended to the private sector continued to "expand robustly," the report notes. "Private sector credit from the consolidated financial sector rose by 9.1% (year-on-year) in April 2025. Business credit expanded by 11.4%, driven by loans to the finance and manufacturing sectors. Consumer lending grew by 10.8%, while real estate mortgage loans increased by 6.9%," it stated, the report says. It added that while there was a slowdown in motor vehicle lending, there was an uptick in credit for the purchase of land and real estate, the report discloses. "Credit expansion was supported by ample domestic liquidity. Commercial banks' excess reserves at the Central Bank averaged $6.6 billion in May 2025, before slipping to $5.3 billion in early June," the Central Bank stated, the report relays. The Central Bank stated that its Monetary Policy Committee (MPC) considered the "uncertain outlook" for global growth and inflation amidst trade policy developments and geopolitical tensions in the Middle East, the report relays. "The MPC also noted the various reactions of central banks in the circumstances. Domestically, low inflation and favourable financial conditions have supported credit expansion. At the same time, the MPC noted the need for continued vigilance on credit quality given the increase in bank lending. The Committee also considered that in the coming months, the path of domestic fiscal financing would have important implications for liquidity management. Taking all these factors into account, the MPC agreed to maintain the repo rate at 3.5%," it stated, the report discloses. "The Central Bank will continue to carefully examine and analyse international and domestic developments and prospects," the Central Bank stated, the report adds. =============== X X X X X X X X =============== LATAM: New IDB Program Empowers Local Govts with Funding Access --------------------------------------------------------------- The Inter-American Development Bank (IDB) has approved the "IDB for Cities and Regions" initiative, a pioneering five-year pilot that will enable eligible cities, states, and regions in Latin America and the Caribbean to access a financing line of up to $1 billion in investment loans and guarantees directly from the IDB. It will provide local governments with direct access to financing for infrastructure, urban development, and delivery of services to promote sustainable growth. In addition to financing, the program aims to strengthen the development capacity and creditworthiness of subnational governments across the region through its in-house expertise and complementary technical assistance. "The program is an important addition to the toolkit of the Bank's development financing. By providing direct access to financing, and strengthening their institutional capacity, we are equipping subnational governments with the tools they need to lead transformative development in their own communities," said IDB President Ilan Goldfajn. "IDB for Cities and Regions" has two complementary subprograms: - A $1 billion investment financing window for eligible subnational governments to fund urban infrastructure and service-delivery projects. - A technical facility to support institutional reforms, capacity building, and project design and preparation. The pilot phase seeks to approve approximately 10 individual operations. Eligible projects, conditioned to compliance with national legal and fiscal frameworks, must demonstrate high development impact, have potential to attract private-sector financing, and contribute to improved efficiency and effectiveness in local governance. The initiative will also support private-sector financing to subnational entities that have limited access to capital markets. The IDB's involvement aims to spark investors' interest through continued support, providing technical assistance and oversight throughout the project's life cycle, ensuring rigorous standards, robust risk management, transparency, and accountability. "The IDB, leveraging its long experience with local governments, aims to be a truly private-sector-focused development bank, not only by directly funding more private-sector projects through IDB Invest, but by strengthening the enabling conditions for the private sector to invest," added Goldfajn. ********* 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 2025. 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 * * *