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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
Tuesday, September 9, 2025, Vol. 26, No. 180
Headlines
A R G E N T I N A
ARGENTINA: Alarm Bell Ring for Investors Amid Milei Scandal Claims
ARGENTINA: Argentines Snap up Dollars as Controls Relaxed
B R A Z I L
BRAZIL: Brands Opponents "Traitors" as it Faces U.S. Sanctions
C O S T A R I C A
LIBERTY TELECOMUNICACIONES: S&P Affirms 'B+' LT ICR, Outlook Stable
D O M I N I C A N R E P U B L I C
DOMINICAN REPUBLIC: US Tariff Could Hurt Export Competitiveness
J A M A I C A
JAMAICA: 91-Day and 182-day Treasury Bills Oversubscribed
M E X I C O
BRASKEM IDESA: S&P Places 'B-' ICR on CreditWatch Negative
P A N A M A
BANCO LATINOAMERICANO: S&P Rates New Tier 1 Capital Notes 'BB-'
U R U G U A Y
URUGUAY: To Pitch Pipeline Route for Vaca Muerta's Natural Gas
X X X X X X X X
LATIN AMERICA: EU to Present Mercosur Trade Deal for Members' OK
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A R G E N T I N A
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ARGENTINA: Alarm Bell Ring for Investors Amid Milei Scandal Claims
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Ariel Maciel at Buenos Aires Times reports that members of
so-called 'circulo rojo' business establishment are concerned by
possible consequences of the recent scandal, which could slow
desired influx of investment.
"If the reforms are questioned for being pushed by a government
accused of corruption, they will never be long-term," concludes one
of Argentina's top businessmen," notes the report.
The fear of the failure of far-reaching measures, which could be
affected by the "early denunciations" of bribery in the highest
circles of President Javier Milei's national government, is real
among Argentina's 'circulo rojo' business establishment, according
to Buenos Aires Times. Some fear it could even topple even the
consensus over fiscal balance, the report notes.
Dogged by the audio revelations of Diego Spagnuolo, the ex-director
of the ANDIS (Agencia Nacional de Discapacidad) agency for the
disabled, affecting Presidential Chief-of-Staff Karina Milei
(President Javier Milei's sister), Eduardo 'Lule' Menem and other
top-ranking officials, Argentina's government is now suffering the
silent stampede of private-sector companies, which until now had
maintained their public support, the report says. Some are already
reticent about defending the libertarian administration from the
accusations of friendly fire, the report discloses.
"Spagnuolo is the libertarian [version of disgraced former public
works secretary] Jose Lopez," comments one source from the top
circles of the circulo rojo, referring to the Kirchnerite
corruption scandal involving the disgraced public works official,
who was arrested in June 2016 with more than US$8 million and
weapons in his possession, the report says.
"At that time, it was tossing [dollar-laden] bags -- now it is
denouncing himself for bribery. Neither one nor the other are the
masterminds of corruption but only the tip of the iceberg," the
source continued, the report notes.
"We do not know how all this will end but it is infuriating how all
the effort made to balance the books in Argentina -- with the
entire political spectrum accepting that fiscal order is positive
and should be sustained, irrespective of the party in government --
can be squandered by this presumed conduct. Kirchnerism met its
end with that photo -- we hope that this does not happen now
because it would be to start all over again from zero, with the
risk of populism returning," the business leader concluded, the
report relays.
Other members of the country's most powerful firms, consulted by
Perfil, warned that "the denunciations of corruption hamstring the
economic future in the medium and long term," the report discloses.
One business leader said: "The existence of officials accused of
administration with bribes and shady deals leaves little room for
upholding the institutions and respect for legal security,
fundamental for in-depth projects and the most important
investments," the report says.
Investments on Hold?
At least two businessmen linked to the energy sector warned that
the developing scandal will affect investors studying
opportunities, the report relays. "The planned investments for
next year have been totally frozen until the judicial situation is
clarified," said one, revealing there is a "strong fear" of the
denunciations plunging the government and its model into "crisis."
Argentina's country risk rating "will stay high because
macroeconomic order is not enough if clarity as to the
institutional path is lacking," the director of a company consulted
by Perfil hastened to confess, the report discloses.
This is not the first denunciation of corruption faced by the La
Libertad Avanza government since taking office 20 months ago, but
it is one of the most important, the report says. The problem
distinguishing this one (even more than the '$LIBRA' cryptocurrency
case, where Milei himself exposed his image in an accusation of
presumed fraud) is that the heart of the President's political
power has been moved into the spotlight: "El Jefe," or "The Boss,"
as Milei calls his sister Karina, the report relays.
These fears had already begun to be felt at the recent Council of
the Americas symposium on August 21, a few hours after the voice
messages of Spagnuolo denouncing himself were leaked, the report
notes.
"If she is proven guilty, it's the end of the government. But
rapid court action is improbable, as the country's history has
shown. If the doubts are not dissipated, the damage will be
irreparable because nobody is going to trust measures which could
be repealed in the future for considering them to have been decided
by an administration riddled with corruption," said another
private-sector voice, left in shock by the revelations, the report
discloses.
Electoral Risk Temporary?
Despite the developing scandal, business leaders remain confident
that there will be a La Libertad Avanza landslide in the October
midterms. Citing opinion polls, many believe the result at the
ballot-box will be favourable, the report notes. "The
denunciations will carry little weight because society still
positively values inflation coming down," offered one leading
business voice, the report says.
Nevertheless, the owner of a local construction firm recalled that
ex-president "Mauricio Macri also won the midterms, but without
political leadership no government can be successful," the report
relays.
"The electoral risk is temporary, the corruption, not," affirmed a
money market source who analyses the economy for one of the most
important banks in the world, notes the report. The professional
made a distinction between the volatility of interest rates, the
pressure on the dollar or the government's battle with the Congress
over public spending and "market mistrust from the discredit
triggered by the suspicions of corruption."
"Without mentioning if anything in all this turns out to be true
and proven. In the first place, there is a feeling which the
government is not managing to clear. The second thing would be a
court decision tantamount to a political death sentence," he
discharged, the report relays.
The big problem is denunciations hanging over key members of the
government, creating "the impossibility of maintaining over time
the deep reforms which the country needs," the report notes.
"Until now there were two unknown factors about the reforms: that
the government clinches the necessary majority between their own
people and allies in Congress after next December 10 and that Milei
does not turn into Nero, governing to stay in power," said one
leading businessman, the report discloses.
"Now there is a third, which is already out of government control
and linked to the actions of the political caste, but without
[having] the political skills to confront it," lamented the source,
a confessed defender of libertarian measures until now, the report
adds.
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.
Moody's Ratings on July 17, 2025, upgraded Argentina's
long-term foreign currency and local currency issuer ratings to
Caa1 from Caa3 and changed the outlook to stable from positive.
The upgrade reflects Moody's views that the extensive
liberalization of exchange and (to a lesser extent) capital
controls, alongside a new International Monetary Fund (IMF)
program, support the availability of hard currency liquidity and
ease pressure on external finances. This reduces the likelihood of
a credit event. In January 2025, Moody's raised Argentina's local
currency ceiling to B3 from Caa1 and the foreign currency ceiling
to Caa1 from Caa3.
Fitch Ratings, on May 12, 2025, upgraded Argentina's Long-Term
Foreign-Currency and Local-Currency Issuer Default Rating (IDR) to
'CCC+' from 'CCC'. 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+'. DBRS, Inc. upgraded Argentina's Long-Term Foreign and
Local
Currency Issuer Ratings to B (low) from CCC in November 2024.
ARGENTINA: Argentines Snap up Dollars as Controls Relaxed
---------------------------------------------------------
Gonzalo Martinez at Buenos Aires Times reports that avers in
Argentina have snapped up nearly US$130 million per day since
controls limiting access to foreign currency were lifted in April,
a Central Bank report has revealed.
According to the institution's foreign exchange balance sheet,
individuals purchased US$10.13 billion between April and July, the
report notes.
During said period, there were only 79 business days (including
public holidays), equating to around US$128 million per day, the
report relays.
In turn, US$1.18 billion were sold, leaving a negative balance of
US$8.95 billion, the report discloses.
That amount more than doubles Argentina's positive energy balance,
which was nearly US$4 billion, boosted chiefly by production at the
giant Vaca Muerta shale oil formation, the report notes.
Meanwhile, savers sent US$2.62 billion abroad. External assets of
the non-financial private sector totalled US$ 5.43 billion in July,
the report says.
As for the level of foreign direct investment (FDI), the difference
between income and expenditure produced a negative balance during
the first seven months to the tune of US$1.37 billion, said the
same Central Bank report.
This situation arises despite the introduction of President Javier
Milei's RIGI large investment incentive scheme, which has failed to
take off. Just eight initiatives have been approved for a total
amount of US$13.42 billion so far, the report relays. Despite
announcements, projects show little activity: for example, looking
at imports, only three projects have registered movement, the
report discloses. In total, imports related to investment total
just US$26 million, the report relaus.
The Central Bank has also released a study on foreign investment
for the first quarter of the year, the report notes. The sectors
which captured the greatest flows were "operation of mines and
quarries" with US$758 million and "deposit-taking companies" with
US$610 million, the report relays. "FDI expenditure included
especially 'Information and communications' (negative US$ 881
million) and 'Manufacturing industry' (negative US$ 340 million),"
the document highlights, the report dscloses.
"The main source of FDI flows in the first quarter of 2025 was
Switzerland, with a net income of US$916 million, followed by
Canada with US$337 million. Next came the United States, with
US$303 million, Uruguay, with US$248 million and the Netherlands,
with US$232 million. The main net outflows included Brazil
(negative US$898 million) and Spain (negative US$642 million)," the
Central Bank added, the report notes.
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.
Moody's Ratings on July 17, 2025, upgraded Argentina's
long-term foreign currency and local currency issuer ratings to
Caa1 from Caa3 and changed the outlook to stable from positive.
The upgrade reflects Moody's views that the extensive
liberalization of exchange and (to a lesser extent) capital
controls, alongside a new International Monetary Fund (IMF)
program, support the availability of hard currency liquidity and
ease pressure on external finances. This reduces the likelihood of
a credit event. In January 2025, Moody's raised Argentina's local
currency ceiling to B3 from Caa1 and the foreign currency ceiling
to Caa1 from Caa3.
Fitch Ratings, on May 12, 2025, upgraded Argentina's Long-Term
Foreign-Currency and Local-Currency Issuer Default Rating (IDR) to
'CCC+' from 'CCC'. 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+'. DBRS, Inc. upgraded Argentina's Long-Term Foreign and
Local
Currency Issuer Ratings to B (low) from CCC in November 2024.
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B R A Z I L
===========
BRAZIL: Brands Opponents "Traitors" as it Faces U.S. Sanctions
--------------------------------------------------------------
Arkady Petrov at Rio Times Online reports that President Luiz
Inacio Lula da Silva used Brazil's September 7 Independence Day to
sharpen his rhetoric against political rivals.
In a five-minute national address, he declared that Brazilians who
lobby abroad for sanctions against their own country are nothing
less than "traitors of the homeland," according to Rio Times
Online.
The remark came after former U.S. president Donald Trump imposed a
sweeping 50% tariff on Brazilian imports, one of the harshest trade
penalties in decades, the report notes.
The measure, enforced in August, followed months of lobbying in
Washington by Congressman Eduardo Bolsonaro, son of Jair Bolsonaro,
the report discloses.
Now living in the United States, Eduardo described the tariff as
"bitter but necessary medicine" to pressure Brazil's Supreme Court,
which he accuses of persecuting his father, the report says.
At the center of this confrontation stands Justice Alexandre de
Moraes. Praised by Lula's allies as a guardian of democracy, he has
ordered arrests, asset freezes, and account suspensions against
Bolsonaro-aligned figures accused of plotting a coup, the report
relays.
Critics counter that these actions amount to censorship and
political persecution, the report notes. The U.S. government sided
with the latter view: in July it revoked Moraes's visa and
sanctioned him under the Global Magnitsky Act, citing "an
oppressive campaign of censorship and arbitrary detentions," the
report discloses.
Sovereignty Reframed
For Lula's camp, however, it is not Moraes who betrayed the nation
but those who invite foreign pressure, the report says.
To cement that narrative, the government rolled out the campaign
"Brasil com S de Soberania", followed by the Workers' Party's
"Defenda o Brasil," the report relays.
Social media feeds filled with images of the Brazilian flag stamped
with slogans like "false patriots" and "traitors of the homeland."
One widely shared video declared that "patriots salute another
flag" - a jab at Bolsonaro supporters who waved U.S. banners
alongside Brazilian ones, the report notes.
The move seeks not only to defend national pride but to redefine
who is allowed to claim it, the report discloses. Symbols once
associated with Bolsonaro rallies are now presented as the rightful
property of Lula's movement, the report relays.
Independence Day itself was framed as a loyalty test: either march
for sovereignty with the government or be cast as siding with
outsiders, the report notes.
Shrinking Space for Dissent
The consequences extend beyond slogans. Backed by the Supreme
Court, the administration is pushing for broad regulation of
digital platforms, empowering authorities to remove posts or
accounts accused of spreading "hate" or "fake news," the report
notes.
Supporters call it protection against extremism. Critics warn it
blurs the line between public safety and political control, the
report says.
When political opponents are recast as enemies of the nation, the
risk is that disagreement no longer belongs to the realm of debate
but of crime, the report discloses.
Citizens may find themselves pressured to repeat official
narratives to avoid suspicion, the report relates. Communities
that organize outside the government's framework - whether
churches, civic groups, or independent media - risk being
marginalized or cut off from financial and digital tools they rely
on to survive, the report discloses.
A Loyalty Test for Brazil
What is emerging is a clash between two visions of legitimacy, the
report discloses.
Bolsonaro's allies argue that foreign sanctions are a defense of
democracy against a judiciary gone rogue, the report relays. Lula's
government insists that only by resisting U.S. pressure and
denouncing "traitors" can sovereignty be protected.
Both sides claim to defend Brazil, but each paints the other as an
existential threat, the report notes.
The danger lies in the frame itself, the report discloses. When
politics becomes a matter of patriot versus traitor, ordinary
dissent risks being treated as betrayal.
Citizens may be forced to choose between silence or stigmatization,
between repeating slogans or facing exclusion, the report notes.
Brazil's democracy is not yet lost, but the trajectory raises
alarms, the report says. A country that once prided itself on
pluralism now risks narrowing the space for disagreement.
History suggests that when a government monopolizes patriotism and
treats rivals as disloyal by definition, freedom of thought is the
first casualty, the report adds.
About Brazil
Brazil is the fifth largest country in the world and third largest
in the Americas. Luiz Inacio Lula da Silva won the 2022 Brazilian
general election. He was sworn in on January 1, 2023, as the 39th
president of Brazil, succeeding Jair Bolsonaro.
In October 2024, Moody's Ratings upgraded the Government of
Brazil's long-term issuer and senior unsecured bond ratings to Ba1
from Ba2, the senior unsecured shelf rating to (P)Ba1 from (P)Ba2;
and maintained the positive outlook. S&P Global Ratings raised on
Dec. 19, 2023, its long-term global scale ratings on Brazil to
'BB' from 'BB-'. Fitch Ratings affirmed on Dec. 15, 2023, Brazil's
Long-Term Foreign-Currency Issuer Default Rating (IDR) at 'BB' with
a Stable Outlook. DBRS' credit rating for Brazil was last reported
at BB with stable outlook at July 2023.
===================
C O S T A R I C A
===================
LIBERTY TELECOMUNICACIONES: S&P Affirms 'B+' LT ICR, Outlook Stable
-------------------------------------------------------------------
S&P Global Ratings affirmed its 'B+' long-term issuer credit rating
on Liberty Telecomunicaciones de Costa Rica LY, S.A. (Liberty Costa
Rica; formerly Liberty Servicios Fijos LY, S.A.).
S&P also affirm its 'B+' debt rating on the $400 million
sustainability linked notes due 2031 of the special purpose vehicle
Liberty Costa Rica Senior Finance Ltd.
The stable outlook reflects S&P's view that Liberty Costa Rica's
operational and financial performance will remain steady overt the
next 12 months, supported by growing revenue and EBITDA
generation.
S&P expects continuous revenue growth driven by gains in postpaid
services, and growing EBITDA generation from cost efficiencies.
Subscribers migrating to postpaid plans from prepaid plans,
selective pricing strategies that boosted average revenue per user,
and steady net additions have driven the ongoing growth in postpaid
mobile subscriptions. S&P expects non-subscription sales (such as
handsets and equipment) to incrementally support top-line.
These factors should help mitigate a 4% FX-neutral decline in fixed
customer relationship average revenue per user (ARPU). This decline
was driven by to the buy-to-own customer-premises equipment model,
persistent price competition in fixed services. As a result, S&P
expects revenue growth to be about 4.5% in 2025 and fall toward 4%
in 2026.
S&P said, "We anticipate an EBITDA margin of 42.8% for 2025,
supported by expected higher margins in mobile services and ongoing
cost-reduction initiatives including digitization, distribution,
and labor efficiencies.
"We expect the merger with Tigo (the Latin America brand of
Millicom International Cellular S.A.) will enhance Liberty Costa
Rica's fixed market presence. We anticipate that the merger will
close in the first quarter of 2026. We expect the combined entity
to capture a larger share of the Costa Rican fixed telecom services
market, which is the segment where Liberty Costa Rica faces the
most competition. However, we believe the mobile business will
remain the primary driver of the company's growth.
"We expect Liberty Costa Rica's adjusted leverage will remain
around 2.3x through 2026. Our current projections do not include
Tigo; nevertheless, we assume that the merger will be leverage
neutral. As of June 30, 2025, Liberty Costa Rica's adjusted debt to
EBITDA was about 2.3x while funds from operations (FFO) to debt was
24.7%.
"We expect that the company's leverage metrics will remain
relatively stable over the next couple of years, based on our
expectation of solid mobile operations, the commercial launch and
nationwide rollout of 5G in Costa Rica, and continued execution of
fixed-mobile convergence strategies. We also anticipate funds from
operations to debt of 28%-30% through 2026.
"We revised Liberty Costa Rica's status within the group to
nonstrategic from moderately strategic. Following the recent
announcement of the spin-off of Liberty Communications of Puerto
Rico and the unclear track record of support for other
subsidiaries, we now believe that any potential extraordinary
support for Liberty Costa Rica from Liberty Latin America Ltd. is
uncertain. We expect that the primary and most significant driver
of the group will continue to be Cable & Wireless. However, the
change in the group status does not affect our rating on the
company.
"The stable outlook on Liberty Costa Rica reflects our expectation
that the company will maintain its solid mobile operations and
gross debt to EBITDA below 3x over the next 12–18 months. The
outlook also incorporates our expectation of a smooth integration
with Tigo that doesn't alter leverage metrics."
S&P could lower the ratings on Liberty Costa Rica within the next
12 months if:
-- Contrary to our expectations, the company's operating
performance weakens, slowing the pace of leverage reduction, with
debt to EBITDA above 4.0x on a sustained basis and the company
fails to generate consistent free operating cash flow;
-- Liquidity deteriorates due to higher-than-anticipated capital
expenditure (capex); or
-- Post-merger cash flow generation and leverage metrics
materially underperform S&P's base-case expectations.
Although unlikely over the next 12 months, S&P could raise the
ratings if operating performance exceeds our expectations,
evidenced by:
-- Adjusted debt to EBITDA falling well below 2.0x on a sustained
basis while the company generates significant free operating cash
flow (leading to adjusted free operating cash flow to debt that is
above 15% consistently, as well as ample liquidity headroom); and
-- Discretionary cash flow to debt remaining above 10% or a
demonstrated prioritizing of debt reduction.
An upgrade would also require a strengthening of the company's
revenue scale and subscriber base to be more comparable in size
with those of larger international peers with broader geographic
footprints.
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D O M I N I C A N R E P U B L I C
===================================
DOMINICAN REPUBLIC: US Tariff Could Hurt Export Competitiveness
---------------------------------------------------------------
Dominican Today reports that the president of the Dominican
Exporters Association (Adoexpo), Karel Castillo, warned that the
new 10% tariff imposed by the United States on Dominican products
could undermine the country's competitiveness and called for
negotiation mechanisms to cushion its impact.
Speaking at the luncheon conference "Modern Customs: Secure Trade
in a Globalized World," he explained that the measure makes
Dominican goods less attractive compared to those from Mexico and
Canada. He revealed that exporters paid 50 billion pesos in tariffs
in May, a figure that climbed to 58 billion in June, according to
Dominican Today.
Despite this challenge, Castillo highlighted the strength of
Dominican exports, which surpassed US$8 billion between January and
July, marking 30.4% growth, the report notes. He noted that India
has emerged as the nation's second-largest trading partner, while
ties with Canada and China continue to expand, opening new
opportunities for local producers, the report says.
He stressed the need to accelerate customs and logistics
modernization to address high costs, bureaucracy, and technological
gaps, the report discloses. Castillo praised reforms by the
General Directorate of Customs, including 24-hour clearance,
digitized processes, and improved trade security, the report
relays. However, he cautioned that the sector cannot afford to
slow down, insisting that stronger public-private collaboration is
essential to face this tariff turbulence and safeguard export
competitiveness, 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.
S&P Global Ratings affirmed its 'BB' long-term foreign
and local currency sovereign credit ratings on the
Dominican Republic on December 3, 2024. The outlook remains
stable. S&P also affirmed its 'B' short-term sovereign
credit ratings and kept the transfer and convertibility
(T&C) assessment unchanged at 'BBB-'.
Fitch, on November 26, 2024, affirmed the Dominican Republic's
Long-Term Foreign-Currency Issuer Default Rating (IDR) at 'BB-'.
The Rating Outlook is Positive.
Moody's credit rating for Dominican Republic was last set at Ba3
in August 2023 with the outlook changed to positive.
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J A M A I C A
=============
JAMAICA: 91-Day and 182-day Treasury Bills Oversubscribed
---------------------------------------------------------
RJR News reports that the Ministry of Finance says investors
submitted bids of $1.9 billion for its 91-day treasury bill, from
which it sought just $700 million to help fund this year's budget.
The Ministry says the average interest rate sought by investors was
5.2 per cent, according to RJR News.
It also reports bids of $3.1 billion for its 182-day treasury bill,
again seeking only $700 million, the report notes.
The average rate was also 5.2 per cent, the report relays.
These sums form part of the $158.4 billion the Government plans to
borrow this fiscal year, in addition to $949.5 billion in tax
revenues and $132 billion in non-tax revenues, the report adds.
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.
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M E X I C O
===========
BRASKEM IDESA: S&P Places 'B-' ICR on CreditWatch Negative
----------------------------------------------------------
On Sept. 5, 2025, S&P Global Ratings placed its 'B-' issuer credit
and issue ratings on Mexican polyethylene producer Braskem Idesa
S.A.P.I. on CreditWatch with negative implications.
S&P expects to resolve the CreditWatch once it has enough detail to
assess Braskem Idesa's measures to manage liquidity and capital
structure.
The company reduced 46% of its cash in one quarter, causing the
company to seek a potential liquidity relief.
Braskem Idesa's interest coverage weakened beyond its projections
because of pressured cash generation after constrained feedstock
and longer-than-expected major maintenance.
Adjusted EBITDA interest coverage ratios were 0.3x on an annualized
basis for the second quarter of 2025, while cash balance declined
about 46%.
Braskem Idesa's reported cash was MXN2,483 million in the second
quarter of 2025, compared with MXN5,437 million reported last
quarter. On Aug. 28, 2025, Braskem, S.A. (BB-/CW Neg) announced
that it is working with Grupo Idesa (NR) to evaluate options to
deal with the current challenges of the company's capital structure
and liquidity because of pressured business and financial
conditions. S&P thinks this undisclosed information could be
material to its credit risk analysis and are placing the ratings on
CreditWatch negative.
Unsustainable to its current business and financial conditions,
interest payments continued to negatively weigh on the company's
cash generation. Approximately MXN800 million in quarterly adjusted
interest payments surpassed the company's EBITDA generation during
the second quarter of 2025, and we expect it will continue as such
for the remainder of the year. S&P said, "In our opinion, the
company depends on favorable industry and financial conditions to
strengthen its cash balance to cover the remaining interest
payments for the second half, as well as other cash requirements
for capital expenditures and working capital. Under pressured
conditions, this could lead us to downgrade the rating to a 'CCC'
category unless we receive a clear and strong capital structure and
liquidity improvement plan. As of this report's date, despite our
view of a weaker liquidity position, the company has paid the
interests as of August 2025 and does not have major maturities in
the short term, which gives the company some cushion."
S&P said, "Average utilization rates of 66% during the first half
will not allow Braskem Idesa to reach our previous expectations for
2025. During the second quarter ended June 30, 2025, Braskem Idesa
received about 13 thousand barrels of ethane per day (bpd) from
Pemex (compared with 26 thousand bpd in 2024), representing a 50%
decline. In addition, imported sources also declined 26% to 17
thousand bpd (compared with 23 thousand bpd in 2024), which were
not able to compensate expected feedstock. The company largely
depends on feedstock availability, which drives utilization rates
volatility. On a smaller scale, the company also reduced production
because of major maintenance. Braskem Idesa reached 44% of
utilization rates as of June 30, 2025, (compared with 79% in the
first quarter of 2025, and 80% expected in our previous review for
year-end), which makes it unlikely to reach previous targets of 85%
for the full year.
"In addition to lowered volumes, industry-wide prices continued
declining over the quarter; also supporting weaker EBITDA
generation. The company reported 163,000 tons of volume sales
during the second quarter ended June 30, 2025 (compared with
193,000 tons in the first quarter of 2025 and 243,000 tons in the
second quarter of 2024), a 15.5% and 33% decline, respectively.
This, together with fixed production costs weighing on lower
production rates, EBITDA generation for the second quarter was
barely MXN274 million (compared with MXN1,177 million in the first
quarter of 2025 and MXN1,310 million in the second quarter of
2024), representing almost 25% of a regular quarter.
"The CreditWatch reflects our view that the company's liquidity is
tight and that we could lower the rating by at least one notch if
it cannot provide an achievable and well-supported strategy to
improve its cash position and meet its financial obligations in the
form of interest expenses. We are expecting to receive additional
information from Braskem Idesa about possible alternatives
currently being discussed to improve liquidity sources and mitigate
further credit risk.
"We could affirm the ratings depending on our view of the company's
ability to maintain credit protection measures, cash flow, and
liquidity in line with the current ratings.
"We intend to resolve the CreditWatch placement within the next 90
days as we gain more clarity on the proposed improvements in cash
generation and the potential liquidity relief from upcoming
strategies."
===========
P A N A M A
===========
BANCO LATINOAMERICANO: S&P Rates New Tier 1 Capital Notes 'BB-'
---------------------------------------------------------------
S&P Global Ratings assigned its 'BB-' long-term issue-level rating
to the proposed subordinated Tier 1 capital notes to be issued by
Banco Latinoamericano de Comercio Exterior (Bladex). The issuance
is perpetual, noncumulative, and fixed-to-fixed. The rating on
these hybrid notes is subject to our review of the final amount and
documentation.
S&P believes that the notes will complement Bladex's
(BBB/Stable/A-2) financial strategy and support the bank's credit
growth while it strengthens its capital base and maintains funding
diversification.
The 'BB-' issue rating on the proposed notes is four notches below
our 'BBB' long-term issuer credit rating (ICR) on Bladex, based
on:
-- One notch because the notes are contractually subordinated to
other senior debt;
-- Two additional notches for the notes' discretionary nonpayment
clause, which allows the instrument to defer coupon payments while
classified as regulatory Tier 1 in a jurisdiction with Basel III
standards, such as Panama; and
-- An additional notch because, in S&P's view, the Panamanian
regulator has the capacity to impose losses on the instrument under
nonviability.
Once Bladex's proposed notes have been issued and confirmed as part
of its Tier 1 capital base, S&P expects to assign them intermediate
equity content in accordance with its criteria. This reflects its
understanding that the notes:
-- Are perpetual regulatory Tier 1 capital instruments;
-- Are capable of differing noncumulative interest payments
without triggering a default;
-- Have no material restrictions on the ability to defer or
otherwise absorb losses while the issuer is a going concern; and
-- Have no step-up clause that could increase the incentive to
redeem the notes.
A hybrid capital instrument with intermediate equity content is
eligible to be included in the total adjusted capital calculation
until the amount is equivalent to up to 33% of the bank's adjusted
common equity.
S&P said, "In this regard, we would include the notional
outstanding amount of this hybrid capital issuance--which could be
up to $300 million--and it would strengthen Bladex's
capitalization, resulting in a projected risk-adjusted capital
(RAC) ratio of 12.7% for 2025-2026. As a result, our capital and
earnings assessment for Bladex is strong, and we expect its RAC
ratio to remain within our 10%-15% threshold for this category over
the next two years.
"The proposed notes also don't affect our view of Bladex's funding
and liquidity. According to our calculation, the notes would make
up less than 3% of the bank's total funding base, so they won't
significantly modify the bank's funding mix. Bladex's funding has
broad geographic and product diversification, alongside a stable
deposit base that represents 62% of the bank's funding sources. In
particular, Bladex's deposit base benefits from the large presence
of central banks, which are Bladex's class A stockholders and
account for 37% of the bank's total deposits.
"Our 'BBB' long-term ICR on Bladex reflects its resilient business
and leading role in trade finance in Latin America, sound
governance practices, and prudent underwriting standards. Bladex is
also one of the banks with the healthiest asset quality metrics in
Latin America, and it has solid RAC levels and an adequate funding
structure that supports liquidity."
=============
U R U G U A Y
=============
URUGUAY: To Pitch Pipeline Route for Vaca Muerta's Natural Gas
--------------------------------------------------------------
Ken Parks at Bloomberg News reports that Uruguay plans to pitch a
natural gas pipeline through its territory to investors and
neighbouring governments that would link Argentina's Vaca Muerta
shale deposit with Brazil, Industry & Energy Minister Fernanda
Cardona said in an interview.
Cardona's Mnistry recently submitted a report including a potential
pipeline route and gas demand to President Yamandu Orsi that will
guide negotiations with a view to start construction by 2030, said
Cardona, who declined to provide further details about the
document, according to Bloomberg News.
"This was one of the issues that President Orsi took up the same
month he started his term," in March, Cardona said in an interview
in Montevideo, Bloomberg News notes.
He added that Uruguay's political stability, proximity to Brazil
and existing gas pipelines with Argentina make it an attractive
option that would complement other proposals, Bloomberg News
relays. Cardona also visited Vaca Muerta earlier this year to
gauge interest, Bloomberg News discloses.
Despite its stability and wealth, Uruguay is relatively late to the
race to channel the growing volumes of natural gas from Vaca Muerta
shale formation to industrial buyers in Brazil, Bloomberg News
notes. Competing options include upgrading an existing pipeline
that runs through crisis-prone Bolivia or building a pipeline
directly to Brazil or through Paraguay, Bloomberg News relays.
Paraguay, a landlocked country of 6.1 million people about the size
of California, is already lobbying Argentina and Brazil to back a
US$1.9-billion pipeline across its territory, Bloomberg News
relates. Paraguay and Argentina signed a memorandum of
understanding to evaluate that proposal in July, Bloomberg News
notes.
Uruguay could use some of the gas from a potential pipeline to
power its industry, Cardona said, Bloomberg News discloses.
Argentina's gas riches "will be enough to supply other countries.
We need to think ahead in a timely way so that if that happens
Uruguay can also benefit," she added.
===============
X X X X X X X X
===============
LATIN AMERICA: EU to Present Mercosur Trade Deal for Members' OK
----------------------------------------------------------------
AFP, citing EU sources, reports that the European Commission is to
present EU countries with the final text of a huge trade deal with
South American bloc Mercosur for approval.
Twenty-five years in the making, the agreement with the club
bringing together Argentina, Brazil, Paraguay and Uruguay will
create a 700-million-customer free-trade area, according to AFP.
Struck by Brussels in December, it still needs to be approved by at
least 15 of the EU's 27 member nations -- and the European
Parliament -- to be formally adopted, the report notes.
The deal is backed by a wide majority of EU countries keen to
diversify trade away from the United States, the report discloses.
But it has been staunchly opposed by France over fears that a flow
of cheaper agricultural goods would undercut European farmers, the
report says.
To allay such concerns, the commission has pledged to strengthen
safeguard clauses for "sensitive agricultural products," two
sources told AFP.
Brussels had already said it planned to set up a one-billion-euro
(US$1.2 billion) "reserve" for European farmers who might be
negatively impacted by the deal, the report relays.
The deal, once ratified, would allow the EU to export cars,
machinery and pharmaceutical products more easily to South America,
the report notes.
In return, agricultural giant Brazil and its neighbours would be
able to sell meat, sugar, rice, honey, soybeans and other products
to Europe with fewer restrictions, the report adds.
*********
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.
Copyright 2025. All rights reserved. ISSN 1529-2746.
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