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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
Thursday, January 29, 2026, Vol. 27, No. 21
Headlines
A R G E N T I N A
ARGENTINA: Cuts Export Taxes & Floods Wheat Market
CORDOBA: Fitch Rates Up to USD800MM New Unsec. Notes 'B-(EXP)'
CORDOBA: Moody's Rates Up to $800MM New Unsecured Notes 'B3'
B R A Z I L
BRAZIL: Sugarcane Farmers Cutting Back, Real Shock May Come Later
FS INDUSTRIA DE BIOCOMBUSTIVEIS: Moody's Rates New $500MM Notes Ba3
JBS SA: Aims to Double Output of New Saudi Plant
C O L O M B I A
P.A. UNION DEL SUR: Fitch Affirms 'BB' Rating on Loans & Notes
E C U A D O R
CORPORACION QUIPORT: S&P Rates $300MM Senior Secured Bond 'B'
ECUADOR: Moody's Upgrades Foreign Currency Issuer Rating to Caa1
ECUADOR: S&P Affirms B-/B Sovereign Credit Ratings, Outlook Stable
G U A T E M A L A
ENERGUATE TRUST 2: Fitch Hikes LongTerm Local Currency IDR to 'BB+'
J A M A I C A
JAMAICA: Jamaicans Left With 4% of Salary After Monthly Expenses
JAMAICA: Projecting Sharp Economic Decline
M E X I C O
DEL MONTE: Creditors Sue Fellow Lenders Over Ch. 11 Loan Treatment
P A R A G U A Y
PARAGUAY: Remains Resilient Despite Global Uncertainty, IMF Says
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A R G E N T I N A
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ARGENTINA: Cuts Export Taxes & Floods Wheat Market
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Rio Times Online reports that Argentina is coming off a wheat
harvest tracked around 27.7–27.8 million tonnes, a new national
record. That extra supply lands in global markets right when many
importers rebuild stocks, according to Rio Times Online.
It also arrives with a policy nudge. Argentina lowered export taxes
on wheat and barley from 9.5% to 7.5%, the report notes. In
commodity trade, small tax cuts can decide entire tenders, the
report relays.
That is why Europe's surplus is not translating into easy sales.
Western Europe is typically a higher-cost origin, the report
discloses. When Argentina offers wheat near $212–$215 a tonne
FOB for February shipment, it sets a tough benchmark, the report
says.
Recent comparisons have shown gaps that leave French or Romanian
wheat roughly $16–$18 per tonne higher, the report says. Earlier
in the season, Argentine "Up River" wheat was near $207 versus
about $228 for French wheat at Rouen, the report notes.
Buyers do not need to love Argentina, the report relays. They only
need a cheaper landed cost, the report says. Morocco is where the
shift becomes visible, the report discloses. France has already
shipped about 1.63 million tonnes of soft wheat there this season,
the report relates.
But the first Argentine wheat vessel has also reached Moroccan
ports, the report says. That matters because Morocco has become
even more important for EU exporters after Algeria shifted much of
its sourcing toward Black Sea origins, the report notes.
Tenders are reinforcing the new order, the report relays. Traders
reported Algeria buying roughly 600,000 tonnes, with Argentina
expected to be a major supplier, the report discloses. Egypt
remains another battleground, the report notes.
Freight risk tied to the war in Ukraine can complicate Black Sea
flows, but price still dominates decisions, the report says.
Europe’s own constraints add friction, the report relays.
Many farmers have resisted selling at the lowest prices in five
years. That tightens nearby availability and makes exporters less
flexible. Forecasters are responding.
Expana cut its 2025/26 EU soft wheat export outlook by 4% to 28.8
million tonnes, the report notes. EU tracking showed soft wheat
exports around 11.8 million tonnes by January 15, with reporting
lags, the report says.
The clock is also running. Morocco’s domestic harvest starts
around May, usually reducing import demand, the report notes. If
Europe wants large new sales before summer, prices may need to fall
again, 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.
CORDOBA: Fitch Rates Up to USD800MM New Unsec. Notes 'B-(EXP)'
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Fitch Ratings has assigned the expected long-term rating of
'B-(EXP)' to the Province of Cordoba's proposed senior unsecured
notes of up to USD800 million. The notes are denominated in USD
and, according to the preliminary documents, will accrue a fixed
interest rate to be determined at issuance. The notes will amortize
one-third of the total principal in years seven, eight, and nine.
Interest will be payable semiannually, and the notes will mature in
nine years.
The notes will be a direct, unconditional, unsecured, and
unsubordinated general obligation of the province and will rank
pari passu in right of payment compared with its other unsecured
obligations. The notes will be governed by and construed in
accordance with the laws of the state of New York.
The final rating is contingent upon Fitch's receipt of all final
documents conforming to information already received, as well as
final pricing and financial close of the proposed notes.
The General Budget Law (GBL) of the Provincial Public
Administration for 2026 authorizes the provincial executive branch
to carry out credit operations; the GBL authorizes Cordoba's
Investment and Financing Agency to conduct credit operations on
behalf of the province for up to USD2.59 billion, as stated in
Article 34 of the Budget Law. Cordoba's Province Bank (Bancor) acts
as its financial agent.
In this context, the proceeds of the issuance of up to USD800
million will be a selective tender offer for the remaining balance
of the Step-Up International Notes due 2027, in tandem with a new
bond issuance. The final terms and conditions of these operations
will be determined at the time of the tender offer announcement and
pricing, respectively. The remaining proceeds of the notes, net of
the selective tender offer, will be allocated to finance
infrastructure projects and/or repay existing liabilities, as per
the authorization.
Key Rating Drivers
The notes' expected rating is at the same level as Cordoba's
Long-Term Foreign Currency (FC) Issuer Default Rating (IDR) of
'B-', which reflects adequate debt service coverage ratio for the
next 12 months.
On July 30, 2025, Fitch upgraded the Province of Cordoba's ratings.
For details, please see "Fitch Upgrades Province of Cordoba to
'B-'; Outlook Stable" at www.fitchratings.com.
Cordoba's current Standalone Credit Profile is 'b-' and the
province continues to meet Fitch's criteria requirements for a
rating of 'B-', which is above Argentina's 'CCC+' sovereign rating,
due to its strong budget, lack of need for external debt
refinancing, and sufficient liquidity.
As of 3Q25, Cordoba's direct debt totaled ARS3,247.7 billion; the
province's debt is mostly composed of international issuances,
multilateral loans and private bank credits in USD (88.8% of total
stock as of September 2025, down from 99.6% in 2023).
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
-- A downgrade of Argentina's B- Country Ceiling, as well as any
regulatory restrictions to access foreign exchange that heightens
refinancing risks;
-- The IDRs could be downgraded if the estimated actual DSCR drops
below 1.0x in tandem with a liquidity coverage ratio below 1.0x,
underpinned by lower operating margins and unrestricted cash,
regardless of whether the payback ratio remains below 5x, resulting
in the rating being guided directly by rating definitions.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
-- An upgrade of Argentina's B- Country Ceiling could positively
benefit Cordoba's IDRs if the financial profile remains in line
with projections of a payback ratio below 5.0x and actual debt
service coverage ratio improves to above 2.0x.
CORDOBA: Moody's Rates Up to $800MM New Unsecured Notes 'B3'
------------------------------------------------------------
Moody's Ratings has assigned a B3 (Global Scale foreign currency)
rating to the up to USD800 million Senior Unsecured Notes to be
issued by the Province of Cordoba (Cordoba), with final maturity in
2035 (New Notes). The rating on the notes is aligned with Cordoba's
long-term foreign-currency issuer rating. The outlook is stable.
Cordoba will use the proceeds of the New Notes to finalize the
purchase of its Step-Up International Notes due in 2027 with
outstanding amount of $116 million, to finance infrastructure
projects and repay other existing liabilities. The New Notes will
be denominated in US dollars with a coupon paid on a semi-annual
basis. The principal amount will be payable in three equal
installments, in year 7, 8 and 9.
The assigned rating is based on preliminary documentation received
by us as of the rating assignment date and confirmation of issuance
amounts. Moody's do not expect changes to the debt amount or
documentation reviewed over this period, nor Moody's anticipates
changes in the main conditions that the notes will carry. Should
issuance conditions and/or final documentation of the notes deviate
from the original ones submitted and reviewed by the rating agency,
Moody's will assess the impact that these differences may have on
the ratings and act accordingly.
RATINGS RATIONALE
The assigned B3 senior unsecured rating to the new notes is in line
with Cordoba's foreign currency issuer rating, reflecting the
structure of the issuance. The new notes will constitute
unsubordinated and unsecured obligations of Cordoba, and will rank
pari-passu with all other present and future unsecured and
unsubordinated obligations of the province. The assigned debt
rating is in line with the Province's long term foreign currency
issuer rating because they do not present any credit enhancements
that differentiate them from the general solvency of the province
already reflected in its current issuer rating level.
The Province of Cordoba credit profile incorporates a diversified
economic base, adequate own source revenues and a track record of
prudent fiscal management that has supported consistent operating
and cash financing surpluses. These strengths underpin Cordoba's
capacity to maintain liquidity buffers and navigate spending
pressures despite Argentina's volatile macroeconomic environment.
Counterbalancing these factors are the province's high exposure to
foreign currency denominated debt and refinancing needs associated
with upcoming maturities, which heighten sensitivity to exchange
rate movements and broader financial conditions.
Cordoba's credit profile is further constrained by meaningful
macroeconomic and financial linkages with the sovereign, including
elevated systemic risks tied to limited market access and
persistent macroeconomic imbalances. The rating also incorporates a
low likelihood of extraordinary support from the Government of
Argentina (Caa1 stable) in the event of acute liquidity stress.
Together with the issuance of the notes, the Province of Cordoba
intends to complete a cash tender offer for its 2027 Notes, a
process initiated with the placement of an international bond in
2025. The tender offer is not subject to any minimum participation
by existing noteholders; however, it is conditioned on the
concurrent (or earlier) successful closing of the new notes
offering and on compliance with the terms and conditions set forth
in the Offer to Purchase.
The rating scenario considers that, following the issuance of the
new notes and the completion of the province's liability-management
actions, total outstanding debt will increase to approximately 35%
of operating revenues by year-end 2026, from an estimated 28% at
the end of fiscal 2025. While leverage is projected to rise, the
resulting level remains consistent with the assigned B3 rating,
reflecting the province's still-moderate debt burden in relation to
other regional and global peers and the benefits of its improved
maturity profile.
RATING OUTLOOK
The stable outlook for the Province of Cordoba is aligned with the
stable outlook for the sovereign rating and captures Moody's
expectations that economic and financial pressure faced by the
province will not change materially over the next 12-18 months. The
outlook also incorporates Moody's expectations that bondholders
will not face losses exceeding those captured in the B3 rating
category.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING
For the Province of Cordoba an upward rating movement would be
subject to the ratings' relative position to the Government of
Argentina's rating. An upgrade would further require Cordoba to
demonstrate stronger resilience to the underlying macroeconomic
conditions than that of its peers.
A downgrade in the Government of Argentina's ratings or further
systemic deterioration, or both, would exert downward pressure on
the ratings. Increased idiosyncratic risks would also translate
into a downgrade.
ISSUER PROFILE
Cordoba is located in the central region of Argentina. The province
covers an area of 63,831 square miles and is home to a population
of more than 3.9 million people. The province is the fifth largest
and the third most populous metropolitan area in the country. The
provincial economy is diverse, with agriculture representing about
22% of its GDP, followed by commerce (17%), construction (6%), and
education (3%). The province has a strong own-source revenue base,
with 46% of its operating revenue in 2024 coming from its own
sources.
The principal methodology used in this rating was Regional and
Local Governments published in May 2024.
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B R A Z I L
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BRAZIL: Sugarcane Farmers Cutting Back, Real Shock May Come Later
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Rio Times Online reports that Brazil's sugarcane growers are
starting to spend less on the crop that feeds the world's sugar
bowl.
Orplana, which represents 35 grower associations and around 12,000
producers, says farmers are trimming investment because costs
climbed while net returns fell, according to Rio Times Online.
The first cuts are the quiet ones, the report notes. Fertilizers
and other inputs are being reduced, even though they support yield
and cane quality, the report relays.
That matters because sugarcane decisions work on a lag, the report
notes. Cane is harvested over multiple cuts, and replanting cycles
shape future productivity, the report discloses.
Orplana’s leadership warned that if low prices persist, some
producers may avoid renewing supply agreements with mills, the
report says. Others may redirect land to soybeans or corn, which
can offer faster cash flow and clearer pricing signals, the report
relays.
The report disclose that global sugar prices help explain the
pressure. Benchmark raw sugar futures have traded near the mid-14
cents per pound range in recent sessions, close to multi-year lows,
the report notes.
Strong production in key origins, including Brazil and India, has
coincided with softer consumption growth in some markets, the
report says. The result is a surplus narrative that keeps prices
capped, the report notes.
Brazil's current scale is still enormous. UNICA data show 600.4
million tonnes of cane were crushed by Center-South mills through
the second half of December, producing about 40.2 million tonnes of
sugar, the report relays.
That output keeps near-term supply comfortable, even as growers
complain about margins, the report discloses. The bigger question
is timing, the report notes. Orplana expects the next harvest to
be similar or slightly larger, depending on rainfall and field
conditions, the report relays.
The organization argues the real effects may show up in the
following season, as today’s spending cuts translate into weaker
yields and less cane available for processing, the report says.
Its leadership has pointed to 2028 as a plausible window for that
stress to become visible, the report notes.
There is also a fuel angle. Brazil’s ethanol market is changing,
with rapid growth in corn ethanol adding another competitor for
blending economics and mill strategy, the report discloses. If
cane investment slips while demand for sugar and biofuels rebounds,
price moves can be sudden, 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.
FS INDUSTRIA DE BIOCOMBUSTIVEIS: Moody's Rates New $500MM Notes Ba3
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Moody's Ratings assigned a Ba3 rating to the proposed $500 million
senior unsecured notes to be issued by FS Luxembourg S.a r.l.
unconditionally and irrevocably guaranteed by FS Industria de
Biocombustiveis Ltda (FS, Ba3 negative) and FS I Industria de
Etanol S.A. The company's existing ratings are unchanged. The
outlook is negative.
Proceeds from the offering will be used to tender FS senior
unsecured notes due 2031, with a presently outstanding amount of
$350 million (BRL1.9 billion), and other liability management. FS's
proposed tender offer aims to extend the maturity of its
outstanding financial debt and will not result in a material
increase in the company's leverage.
The rating of the proposed notes assumes that the final transaction
documents will not be materially different from draft legal
documentation reviewed by us to date and assume that these
agreements are legally valid, binding, and enforceable.
RATINGS RATIONALE
The proposed liability management will help the company to lengthen
its amortization schedule supporting its financial flexibility.
Moody's believes FS EBITDA will increase about 25% in 2025-26 to
BRL3.5 billion, but Moody's also expects an increase in capex and
negative free cash flow with the construction of FS's fourth
operating mill, demanding a capex of BRL2 billion. In addition to
the initial capex for the construction, the ramp-up will include
high working capital needs anticipating the beginning of operations
of the new mill at year-end 2026. Moody's also observe a downward
trend scenario for ethanol prices because of lower overall
international gasoline prices and the expectation ample supply of
ethanol through the 2026-27 harvest, ending March 2027. The new
mill is expected to ramp-up in December 2026 contributing with an
additional 540 million liters of ethanol production. Although the
new mill increases production capacity it fails to provide further
product or geographical diversification.
FS ratings are supported by the company's adequate liquidity and
business model, which allows for certain predictability of credits
metrics, increased crushing capacity, sustained demand for ethanol
in the coming years and abundant availability of corn as feedstock.
Gross leverage was at 3.5x last twelve months ended September
2025.
Despite volatile spreads, Moody's expects FS to maintain adequate
credit metrics for the Ba3 rating level. While leverage could
increase during periods of weak spreads, Moody's expects the
company to generate positive free cash flow absent of expansion
investments.
FS rating incorporates the company's adequate leverage and
liquidity, and large scale among ethanol producers in Brazil (the
company is the second largest producer that uses corn as
feedstock). FS is a low-cost producer with favorable access to corn
feedstock and is located in a region with high demand for animal
feed, a co-product of the ethanol production process. The company
has a low carbon footprint, benefiting from the sustained growth in
demand for biofuels. Additionally, the company has a strong track
record of growing organically.
FS' rating is constrained by its high exposure to the dynamics of
the ethanol and corn markets; and the consequent susceptibility to
sharp price volatility, event risks, weather imbalances and global
trade flow, which can cause momentary leverage spikes, as observed
in the 2023-24 harvest. The exposure to corn prices is partially
offset by its animal nutrition business, given that the price of
dried distillers grains is directly correlated to that of corn and
soybean meal. Few mills and concentration in a single commodity in
a single region exacerbate FS' commodity risks.
Liquidity is adequate with BRL4.6 billion in cash and BRL0.9
billion in short-term debt, mainly working capital lines. Moody's
believes FS will maintain an active liability management to avoid a
concentration of maturities in the short-term.
RATING OUTLOOK
The negative outlook incorporates Moody's expectations that FS
expansion investments will lead to negative free cash flow
generation and pressure leverage in the near-term. The outlook
incorporates prudent shareholder distributions, which should not
jeopardize liquidity.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING
FS' ratings are constrained by the concentration and single-line
commodity exposure of its business (corn ethanol and related
co-products). An upgrade would require further business
diversification that reduces geographic and commodity risk
exposure, coupled with a robust financial position, consistent
positive free cash flow, low leverage and adequate liquidity.
Quantitatively, an upgrade would require the following: Debt/EBITDA
below 3.0x; Retained cash flow (RCF)/Net Debt above 15%;
EBITDA/interest expense above 5.0x; all on a sustained basis.
A downgrade could result from a consistent increase in leverage or
a deterioration in liquidity. Large shareholder distributions or
the deployment of large investments that compromise short-term
credit metrics and liquidity could trigger a downgrade.
Quantitatively, a downgrade would require the following:
Debt/EBITDA above 4.0x; RCF/Net debt below 12.5%; EBITDA/interest
expense below 2.5x; all on a sustained basis.
FS is headquartered in Lucas do Rio Verde, Mato Grosso, Brazil. The
company produces ethanol from corn feedstock. It also
commercializes the co-products generated in the production process,
including dried distillers grains, wetcake, corn oil for livestock
feed, and electricity and steam. FS is a limited liability company
controlled by US-based Summit Agricultural Group (Summit) (with a
70.7% stake), and other shareholders (including Marino J. Ferraz,
Amerra Chapada LLC, Miguel V. Ribeiro, and Paulo S. Franz). In the
204-25 harvest, FS generated net revenue of BRL10.7 billion ($1.9
billion, converted using the average rate for the period), with a
Moody's-adjusted EBITDA margin of 28.3%.
The principal methodology used in this rating was Chemicals
published in October 2023.
JBS SA: Aims to Double Output of New Saudi Plant
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Ana Mano at Reuters, citing a statement, reports JBS SA will double
production output in its new chicken processing plant in the Saudi
Arabian city of Jeddah by the end of 2026.
JBS's bet in Saudi Arabia underpins a strategy to increase local
food production, while supporting Saudi Arabia's resolve to reduce
reliance on food imports, a step also taken by a rival Brazilian
food producer, according to Reuters.
The plant, which JBS built from the ground and started operations
last year, allowed the company to quadruple its overall production
capacity in Saudi Arabia, where it makes and sells beef and chicken
products under the Seara brand, the report notes.
Last October, JBS rival MBRF signed an investment deal with Saudi
Arabia's Halal Products Development Company (HPDC) to boost their
local joint venture, paving the way for a listing of that JV on the
Riyadh stock exchange by 2027, the report notes.
MBRF is also building a food factory, opens new tab in Jeddah,
Saudi Arabia's second-largest city, with capacity to process about
40,000 tons of meat products per year starting in mid-2026, the
report relays.
In an interview, Joao Campos, CEO of JBS's Seara division, told
Reuters the company's Seara brand was introduced to Saudi consumers
in 2021, and now is a top-three brand by market share in the
country, the report discloses.
Another move to grow JBS's presence in Saudi Arabia involves the
Arabian Company for Agricultural and Industrial Investment, which
will produce products for the Seara brand going forward, Campos
said, the report relays. The executive declined to discuss JBS'
production capacity in Saudi Arabia, where it also runs a plant in
Dammam that makes beef burgers and other chicken products, the
report notes.
JBS has invested $85 million in Saudi Arabia since 2021, the report
recalls. From the company's Jeddah plant, JBS already exports meat
products to countries like Kuwait, Oman and the United Arab
Emirates, the report adds.
About JBS S.A.
JBS S.A. is a Brazilian company that is a large meat processing
enterprise, producing factory processed beef, chicken, salmon,
pork, and also selling by-products from the processing of these
meats. It is headquartered in Sao Paulo. It was founded in 1953
in Anapolis, Goias.
As reported in the Troubled Company Reporter-Latin America in
August 2021, S&P Global Ratings revised the global scale outlook
on JBS S.A. (JBS) and its fully owned subsidiary JBS USA Lux S.A.
(JBS USA) to positive from stable and affirmed its 'BB+' issuer
credit rating. The recovery expectations remain unchanged, and S&P
affirmed the 'BB+' ratings on the senior unsecured notes and the
'BBB' ratings on the secured term loans.
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C O L O M B I A
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P.A. UNION DEL SUR: Fitch Affirms 'BB' Rating on Loans & Notes
--------------------------------------------------------------
Fitch Ratings has affirmed the following Patrimonio Autonomo Union
del Sur (Union del Sur) ratings, in connection with the
Rumichaca-Pasto Toll Road project in Colombia:
-- USD Loan A: USD125 million at 'BB'/'AAA(col)'; Outlook Stable;
-- USD Loan B: USD152 million at 'BB'/'AAA(col)'; Outlook Stable;
-- COP Loan: COP1,019.5 billion at 'BB'/'AAA(col)'; Outlook
Stable;
-- UVR Notes: COP1,027.5 billion at 'BB'/'AAA(col)'; Outlook
Stable.
RATING RATIONALE
The ratings reflect the project's robust concession agreement
structure, which limits exposure to revenue risk via traffic
top-ups and grantor payments, as well as an adequate tariff
adjustment mechanism that increases toll rates by inflation. The
project's strong debt structure is characterized by robust debt
service reserve accounts backed by a letter of credit (LOC) from
investment-grade (IG) entities for the USD loans and from a
liquidity facility for the COP debt. Cash sweep mechanisms largely
protect the transaction from traffic performance that is materially
higher or lower than expected, and the project's distribution test
was satisfactory.
Fitch's rating case (FRC) minimum loan life coverage ratio (LLCR)
of 1.4x is robust for the rating category according to Fitch's
applicable criteria and the project's revenue profile. However,
this is constrained by the transaction's exposure to the credit
quality of Agencia Nacional de Infraestructura's (ANI) obligations
under the concession agreement. ANI is a credit-linked entity to
the Government of Colombia (BB/Stable).
KEY RATING DRIVERS
Revenue Risk - Volume - Midrange
Low Exposure to Volume Risk: The project's revenues have limited
exposure to volume risk. Under Fitch's rating case, around 85% of
revenues over the remaining life of the concession are expected to
come from ANI contributions, including future budget allocations
(FBA), compensations for estimated toll revenues at the Ipiales
shadow toll booth, and top-up payments. The remainder comes from
collections at the El Placer toll plaza. Fitch believes the ANI
payment obligations under the concession agreement are consistent
with the project's credit quality.
Although traffic has exhibited a certain degree of volatility and
the tolls at El Placer are higher than on other routes, the road
offers significant time savings, which reduces price elasticity
compared to competing roads.
Sources of revenue are subject to infrastructure availability,
service levels and quality standards, based on the fulfilment of
indicators provided in the concession agreement. There are clearly
defined, unambiguous, back-to-back penalty deduction mechanisms in
the concession agreement with robust cure periods. Deductions are
legally capped at 10%. The contract limits fines imposed on the
concessionaire and penalty clauses in case of early termination of
the agreement.
Revenue Risk - Price - Midrange
Inflation Adjusted Tolls: Tariffs are adjusted annually for the
inflation rate at the beginning of the year. In 2023, the Colombian
government froze toll rates as part of its anti-inflation policy.
By 2025, tariffs had caught up on all pending inflation
adjustments. Toll rates are higher than competing roads, and if the
net present value of toll collections received by the 8th, 13th,
18th and last year of the concession is below guaranteed values,
ANI is obligated to cover any shortfalls after any applicable
deductions.
Infrastructure Dev. & Renewal - Midrange
Adequate Maintenance Plan: The project depends on a moderately
developed capital and maintenance plan to be implemented directly
by the concessionaire. The program will be funded mainly from
project cash flows, and the concession agreement does not include
hand-back requirements. However, the concessionaire must
continuously operate and maintain the road in compliance with
pre-established contractual requirements.
According to the independent engineer (IE), the operations and
maintenance (O&M) plan is reasonable, and the budget allowances are
at the upper end of the range compared to similar 4G Colombian
projects, anticipating reduced cost overruns. The structure
benefits from a robust twelve-month forward-looking O&M reserve
account (OMRA) and a dynamic major maintenance reserve of the
forward-looking maintenance costs forecasted for the first year,
66% of expenses to be incurred during the second year, and 33% for
the following third year.
Debt Structure - 1 - Stronger
Robust Debt Structure: The project's debt is fully amortizing,
senior secured, comprising USD-, UVR- and COP-denominated
financings. USD-denominated debts are matched with USD-linked
revenues settled in COP, as 57% of future budget allocations are
USD-linked but are partially exposed to a variable interest rate.
UVR-denominated debts are indexed to inflation; similarly, the COP
debt interest rate is exposed to inflation fluctuations.
Structural features include 12-month debt service reserve accounts
(DSRA) in the form of a LOC provided by IG entities for the USD
loans, a liquidity facility from Union Para La Infraestructura for
the COP debt and cash sweep mechanisms for traffic over- and
underperformance. This is according to pre-established debt service
coverage ratio (DSCR) levels. While the UVR tranche legal maturity
dates extend beyond the minimum concession termination date, deemed
as a negative feature, Fitch believes it is highly unlikely the
toll collection present value will be reached by the concession's
25th anniversary.
Financial Profile
The most relevant financial metric for the project is LLCR, given
the transaction's debt structure. Fitch's base case (FBC) and FRC
minimum LLCR are 1.4x. This metric is strong for the rating
category according to applicable criteria and compared with other
similarly rated transactions, particularly considering the
project's low exposure to volume risk.
PEER GROUP
Union del Sur is comparable to Fideicomiso P.A. Pacifico Tres
(BB/Stable and AAA(col)/Stable). Both projects are part of
Colombia's 4G toll road program, present similar revenue streams
that result in a low exposure to volume risk and have debt
structures with robust mechanisms. Both projects have also
completed their construction phase, have a similar contribution of
toll revenues to total revenues (between 30% and 40%) and are
equally exposed to volume risk. Pacifico Tres and Union del Sur
have LLCRs at 1.5x and 1.4x, respectively, and their ratings are
both constrained by the counterparty risk under the concession
contract of ANI.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
-- Deterioration in the financial and/or operational performance of
the project, leading to a minimum projected loan life coverage
ratio below 1.2x under Fitch rating case assumptions;
-- Deterioration in the credit quality of ANI's contributions to
the project;
-- Consistent and/or prolonged delays in quarterly compensation
payments from ANI related to Ipiales toll plaza that deteriorates
the project's liquidity.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
-- Improvement in the credit quality of ANI's grantor obligations.
SECURITY
The security package is the usual and customary for project
financings of this nature. It includes a pledge of the project
company's shares, a first priority security interest in all of its
assets, a pledge of all onshore and offshore accounts, and the EPC
contract security package. It also includes all proceeds from
credit enhancements and insurance / reinsurance and a pledge of the
right to receive the termination payment under the CA.
=============
E C U A D O R
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CORPORACION QUIPORT: S&P Rates $300MM Senior Secured Bond 'B'
-------------------------------------------------------------
S&P Global Ratings assigned its 'B' rating to Corporacion Quiport
S.A.'s (Quiport or the project) issued a $300 million senior
secured bond with fixed-interest rate of 9% maturing in 2037 and a
floating-rate $200 million bank loan maturing in 2035.
.
The bond and the bank loan are backed by all revenues generated at
the Quito International Airport (UIO). The project used the
proceeds to prepay existing debt and for general corporate
purposes.
The stable outlook reflects S&P's expectation of Quiport's
continued resilience to sovereign stress, supported by its
financial structure, including a 12-month debt service reserve
account (DSRA) for the bond issuance and a six-month DSRA for the
bank loan.
Quiport is a special purpose vehicle operating UIO in Ecuador under
a concession agreement with the Municipality of Quito, valid from
2006 until January 2041. The new airport, inaugurated in 2013, is
Ecuador's primary international gateway, handling the majority of
the country's international passenger and cargo volume. The
concession provides a stable operating framework with revenue
derived from regulated and nonregulated activities.
Quiport's regulated revenue component is indexed to U.S. and
Ecuador's inflation. The Municipality of Quito receives 11% of
regulated revenue, increasing to 12% starting in 2036; S&P
incorporates this obligation into our cash flow projections.
Current air traffic volume is evenly split, with approximately 50%
domestic and 50% international--representing 95% of total traffic
from origin and destination (O&D) flights. However, international
revenue account for more than 80% of the project's total regulated
revenue. Ecuador's fully dollarized economy eliminates foreign
exchange risk for the project.
Quiport issued a $300 million 12-year senior secured bond (144A/Reg
S) with a 9% fixed rate and a $200 million 10-year senior secured
bank loan with a floating rate indexed to the Tasa Pasiva
Referencial in Ecuador, plus a spread of about 250 basis points
(bps). The project primarily used the proceeds to prepay debt, pay
transaction costs, fund reserve accounts, and for general corporate
purposes. In addition, the project benefits from a $13.12 million
senior unsecured working capital facility.
S&P said, "Following the issuance's completion and upon receipt and
satisfactory review of the documentation, we assigned our 'B' debt
rating, in line with the 'B' preliminary rating we assigned on Oct.
30, 2025. Based on the final documentation, the overall terms and
conditions, covenants, and structural elements are in line with the
preliminary documents that we analyzed. The terms and conditions
are aligned with our assumptions in our preliminary rating,
including the amount, interest rate, and funding of the DSRAs. Our
updated base-case scenario assumes a minimum and median debt
service coverage ratio (DSCR) of 1.6x and 1.7x, respectively,
aligned with our preliminary rating.
"In our view, the project can withstand a hypothetical sovereign
stress event, which allows us to rate it one notch above the B-'
long-term sovereign credit rating on Ecuador. We based this
assessment on our stress test that incorporates a 20% reduction in
passenger levels, no aeronautical rate adjustments, a 30% increase
in operations and maintenance (O&M) expenses, and a doubling of the
floating interest rate. We believe the project could withstand
these conditions without depleting its DSRA, which covers 12 months
of debt service payments for the bond and six months of payments
for the bank loan."
Furthermore, the project's accounts are held offshore through
direct revenue transfers by the airport operator, eliminating
foreign exchange risk due to the dollar-based revenue and debt.
S&P said, "We assess Ecuador's country risk as '6' (on a scale of
'1' to '6', with '1' as the strongest), which is the main risk
factor in our assessment of the project's operational environment,
and leads to an operations phase business assessment (OPBA) of
'11', compared with the score of '6' assigned to similar airport
project financing transactions such as Montego Bay in Jamaica and
Aerostar in Puerto Rico.
"Our view of Ecuador's country risk reflects its weak institutional
framework, lack of monetary flexibility, poor long-term economic
performance, and heavy dependence on the oil sector." Persistently
high fiscal deficits and lack of funding contributed to sovereign
defaults and debt restructurings in past years, weakening the
sovereign rating. Poor public security and energy shortages have
exacerbated governing challenges. Finally, the country's high
dollarization and its lack of monetary policy reduce its ability to
manage external shocks.
S&P said, "Given that UIO is the main international airport in
Ecuador, we expect volume will grow 2%-3% in the next few years,
leading to DSCRs of about 1.6x. UIO is also a significant cargo hub
(second only to Guayaquil, with approximately 35% market share).
This resilience is further supported by Quiport's predominantly O&D
passenger profile, which offers more stability than hub-and-transit
models. Therefore, we project a minimum DSCR of approximately 1.6x
and a median annual DSCR of 1.7x."
The project's operational risks influence the rating because
Quiport does not face construction risk at this stage. The
project's operational phase will extend from the debt placement in
2025 until 2035 for the bank loan and until 2037 for the bond
issuance, without the airport making expansionary investments to
increase its annual passenger capacity.
S&P said, "The stable outlook reflects our expectation of Quiport's
continued resilience to sovereign stress, thanks to its financial
structure, including a 12-month DSRA for the bond issuance and a
six-month DSRA for the bank loan. We anticipate sufficient cash
flow, even amid potential sovereign stress, providing adequate
cushion. We project airport volume to increase by 1.5%-2.0% over
the next 12-24 months, reflecting the airport's strategic
importance as Ecuador's primary air gateway.
"We could lower the rating on Quiport if we take a negative rating
action on Ecuador. Additionally, a downward revision of Quiport's
stand-alone credit profile (SACP) due to significant deviations in
financial performance, passenger volume, or maintenance needs,
resulting in DSCR of 1.3x or below, could trigger a downgrade.
Government interference affecting cash flow (such as tariff
freezes, mandated new expansionary capital expenditures, both
without compensation) could also prompt us to lower our rating on
Quiport's debt to the sovereign level.
"Assuming all other factors remain unchanged, we could raise the
rating in the next 12 months if we take a positive rating action on
Ecuador."
ECUADOR: Moody's Upgrades Foreign Currency Issuer Rating to Caa1
----------------------------------------------------------------
Moody's Ratings has upgraded the Government of Ecuador's (Ecuador)
long-term foreign currency issuer rating to Caa1 from Caa3. The
outlook remains stable.
The upgrade is driven by a material decrease in credit risks and
reflects Moody's views that durable policy changes, including
improved fiscal management alongside an IMF program, have anchored
investor sentiment, granting the sovereign alternative funding
options. In turn, improved financing access and conditions reduce
government liquidity risks and enhance its capacity to meet its
near-term debt service payments. Government deposits and liquidity
conditions have improved, structural reforms have advanced, and
sovereign spreads have narrowed, improving market access prospects
and decreasing the likelihood of a credit event.
The stable outlook reflects a balance of upside and downside risks
as policy challenges and uncertainties persist at the current Caa1
rating level. On the upside, continued fiscal consolidation and
adoption of planned economic reforms to accelerate growth would
help entrench a benign fiscal trajectory that leads to decreased
financing needs and improving government liquidity. On the other
hand, the sovereign will remain vulnerable to shifts in investor
risk perceptions as it will need continuous market access to meet
debt service on external bonds given a challenging amortization
schedule from 2026-on. Political fragmentation that slows reforms
or economic shocks that undermine market confidence could lead to
shortfalls in external financing and the re-emergence of liquidity
pressures.
Concurrent with the rating action, Ecuador's foreign-currency
country ceiling was raised to B3 from Caa2, maintaining a one-notch
gap between the sovereign rating and the foreign-currency ceiling
to reflect weak policy effectiveness, moderate capital account
openness, and the government's relatively large share in the
country's total external debt. Moody's do not assign a local
currency country ceiling for Ecuador because the country is fully
dollarized.
RATINGS RATIONALE
RATIONALE FOR THE UPGRADE TO Caa1
IMPROVING FISCAL TRAJECTORY AND LOWER FINANCING NEEDS UNDER THE IMF
PROGRAM
Ecuador's fiscal performance has continued to improve under the IMF
adjustment program, supported by stronger economic activity,
permanent revenue measures, and expenditure rationalization
efforts. Two percentage points of a VAT increase originally
introduced as temporary were made permanent in 2025, and more
recently in September 2025 the authorities aligned domestic diesel
prices with international benchmarks. For the second consecutive
year, the central government deficit remained below 4% of GDP in
2025, an outcome Ecuador has not managed to achieve since at least
2012, reflecting both policy-driven consolidation and a cyclical
rebound in economic activity. Moody's estimates that the central
government deficit narrowed to 2.3% of GDP in 2025 from 2.8% in
2024 and forecast it will decline to around 1.8% of GDP in 2026.
Ecuador's strong performance under the $5 billion (3.8% of GDP),
four-year IMF Extended Fund Facility (EFF) reinforces near-term
fiscal credibility and eases funding pressures. Frontloaded IMF
disbursements ($3.3 billion of the program have now been disbursed
to date), have supported further accumulation of central government
deposits at the central bank and reduce estimated financing needs
in 2025-27. The improved fiscal trajectory and frontloaded
multilateral financing help contain near-term financing needs and
support liquidity buffers.
REDUCED RISK OF A LIQUIDITY STRESS-RELATED CREDIT EVENT AND
ENHANCED FINANCING PROSPECTS
Improving treasury and budget management alongside the strong
fiscal performance have resulted in a record level of public sector
deposits at the central bank. Non-financial public sector (NFPS)
deposits stood at $5.8 billion (4.5% of GDP) as of October 2025,
above the IMF program target of $4.9 billion. The larger fiscal
buffers signal improved government liquidity that will grant the
authorities increased financing flexibility.
Moreover, continued implementation of fiscal consolidation and
economic reforms supported by the IMF program has bolstered market
confidence and led to a further reduction in sovereign spreads to
under 470 basis points in January 2026, from over 1,300 basis
points since April 2025. The marked improvement in investor
sentiment that has led to better funding prospects suggests that
Ecuador has regained market access, enabling the sovereign to raise
sufficient financing to cover upcoming amortizations on its
external bonds.
Moody's believes that this shift is not transitory and that the
more benign funding conditions are supported by the progress
achieved on economic and fiscal reforms under the IMF program
mentioned above that is anchoring investor sentiment. Fiscal policy
is now more credibly guided by the goal of strengthening the
sustainability of public finances, reducing public debt and
ensuring adequate government liquidity. Fiscal governance has been
enhanced by a comprehensive revamp of fiscal statistics,
procurement tracking, cash management and increased monitoring of
investment projects. Fiscal liquidity, a historic weakness, is now
actively tracked. The improvements to fiscal management alongside
the implemented revenue and expenditure measures make it more
likely that these policy changes will be durable and will continue
to support investor sentiment as the sovereign builds a more
consistent track record of coherent and sustainable fiscal policy.
Notwithstanding these improvements, the Caa1 rating also takes into
account Moody's assessments that Ecuador's capacity to repay will
remain subject to significant risks and will depend on availability
of external financing, particularly through access to international
capital markets.
RATIONALE FOR THE STABLE OUTLOOK
The stable outlook reflects a balance of upside and downside risks
as policy challenges and uncertainties persist at the current Caa1
rating level.
Continued fiscal consolidation and adoption of planned economic
reforms to accelerate growth would help entrench a benign fiscal
trajectory that leads to decreased financing needs and improving
government liquidity. Efforts to boost economic diversification,
competitiveness, and long-term growth are also integrated into the
IMF program as the authorities are adopting reforms to attract
private investment into the mining, hydrocarbons and energy
sectors. The government introduced a limited set of tax incentives
to stimulate overall economic activity and to encourage private
participation in the electricity sector. Similarly, the government
is working to develop a new fiscal regime for the mining sector,
which holds significant potential to diversify the economy. Private
investment has so far been slow to respond, but given time, these
measures could quicken economic growth, boost government revenues
and support fiscal consolidation efforts.
Nevertheless, the sovereign will remain vulnerable to shifts in
investor risk perceptions as it will need continuous market access
to meet debt service on external bonds given a challenging
amortization schedule from 2026-on. Political fragmentation that
slows reforms or economic shocks that undermine market confidence
could lead to shortfalls in external financing and the re-emergence
of liquidity pressures that have led to past restructurings.
Persistent security challenges, heightened risks of social unrest,
and uncertainties surrounding the durability of political consensus
continue to weigh on the sovereign's credit profile and complicate
the policy environment. Advancing and effectively implementing the
government's proposed reforms remains essential to strengthening
Ecuador's growth prospects and safeguarding fiscal stability.
ENVIRONMENTAL, SOCIAL, AND GOVERNANCE CONSIDERATIONS
Ecuador's ESG Credit Impact Score is CIS-5, reflecting the severe
governance challenges in the country that have resulted in multiple
defaults, and a high exposure to environmental and social risks.
Ecuador's E-5 environmental issuer profile score reflects the
country's exposure to carbon transition risks from dependence of
exports and government revenue on hydrocarbons. Ecuador is also
exposed to physical climate risk. The economy (particularly primary
sector activity) has been subject to droughts and floods from the
El Niño weather shock that happens at irregular intervals.
Ecuador's exposure to social risks (S-5 issuer profile score)
reflects the fact that social considerations play a role in
increasing political risk in the country and weigh on economic
strength. An abrupt deterioration in security in the country from a
marked increase in violence has added new challenges to
governability, economic activity and use of fiscal resources.
Despite measures to raise revenues to fight organized crime,
security conditions have not yet improved in the country and may
eventually lead to increased social demands for more government
action.
The influence of governance on Ecuador's credit profile (G-5 issuer
profile score) reflects a very weak rule of law, high levels of
corruption and the sovereign's default track record. The sovereign
is beginning to build a track record of more prudent fiscal and
liquidity management, but the process is in its initial stages and
its durability outside of an IMF-sponsored program is still
uncertain.
GDP per capita (PPP basis, US$): 16,012 (2024) (also known as Per
Capita Income)
Real GDP growth (% change): -2% (2024) (also known as GDP Growth)
Inflation Rate (CPI, % change Dec/Dec): 0.5% (2024)
Gen. Gov. Financial Balance/GDP: -2.8% (2024) (also known as Fiscal
Balance)
Current Account Balance/GDP: 5.7% (2024) (also known as External
Balance)
External debt/GDP: 48.2% (2024)
Economic resiliency: b2
Default history: At least one default event (on bonds and/or loans)
has been recorded since 1983.
On January 26, 2026, a rating committee was called to discuss the
rating of the Ecuador, Government of. The main points raised during
the discussion were: The issuer's economic fundamentals, including
its economic strength, have materially increased. The issuer's
institutions and governance strength, have not materially changed.
The issuer's fiscal or financial strength, including its debt
profile, has materially increased. The issuer has become less
susceptible to event risks.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING
FACTORS THAT COULD LEAD TO AN UPGRADE
A sustained track record of prudent fiscal management and the
continued implementation of economic reforms that enhance growth
prospects and support continued fiscal consolidation could lead to
a higher rating. Increased buffers to mitigate shocks that could
include a deepening of local capital markets that helps raise
reliable domestic long-term funding and decreases reliance on
external borrowing or improved government liquidity, could exert
upward pressure on the rating.
FACTORS THAT COULD LEAD TO A DOWNGRADE
A material widening of the fiscal deficit or a deterioration of
funding conditions that leads to the reemergence of liquidity
pressures amid a challenging debt maturity schedule on Ecuador's
external bond debt, could jeopardize the sovereign's ability to
access sufficient financing and lead to a downgrade.
The principal methodology used in this rating was Sovereigns
published in November 2022.
The weighting of all rating factors is described in the methodology
used in this credit rating action, if applicable.
Ecuador's "ba2" economic strength score is set below the initial
score of "ba1" to reflect continued economic concentration and
dependence on the hydrocarbon sector in addition to competitiveness
challenges brought about by dollarization. Ecuador's "caa2"
institutions and governance strength score is set below the initial
score of "b2" to reflect the sovereign's track record of default.
The difference in economic strength and institutions and governance
strength scores change the initial scorecard-indicated outcome of
B1-B3 to a final scorecard-indicated outcome of B2-Caa1. The
assigned rating is within the final scorecard-indicated outcome.
ECUADOR: S&P Affirms B-/B Sovereign Credit Ratings, Outlook Stable
------------------------------------------------------------------
S&P Global Ratings, on Jan. 27, 2026, affirmed its 'B-/B' long- and
short-term sovereign credit ratings on Ecuador. The outlook is
stable. The 'AAA' transfer and convertibility assessment is
unchanged. S&P also assigned 'B-' issue credit ratings to Ecuador's
two bonds totaling $4 billion:
-- $2.2 billion notes due in 2034 at 8.25% coupon.
-- $1.8 billion notes due in 2039 at 9.25% coupon.
Outlook
The stable outlook balances better availability of financing from
official lenders and international debt markets with deep-seated
challenges for economic growth. It also incorporates the
government's commitment to fiscal consolidation and its improved
capacity to pass reforms given its strong mandate in Ecuador's
National Assembly, despite the country's history of rapid political
change and confrontation between the executive and the legislative
branches.
Downside scenario
S&P said, "We could lower the ratings over the next six to 12
months if the government fails to achieve fiscal consolidation,
raising doubts about its ability to service external debt. We could
also downgrade the sovereign if we were to consider a future
liability management operation as a distressed debt exchange."
Upside scenario
S&P said, "We could raise the ratings over the next six to 12
months if the government delivers on fiscal consolidation,
substantially reducing its financing needs over the coming years.
Such an outcome could improve our view of the country's
historically weak payment culture. Furthermore, creditworthiness
could improve if the government addresses some long-standing
constraints on economic growth, such as poor public security and
problems in the electricity sector, thereby encouraging
private-sector investment in strategic sectors of the economy."
Rationale
S&P has assigned a 'B-' issue credit rating to Ecuador's two bonds
totaling $4 billion:
-- $2.2 billion notes at 8.25% coupon, amortizing in three equal
installments over 2032-2034.
-- $1.8 billion notes at 9.25% coupon, amortizing in three equal
installments over 2037-2039.
This transaction marks the return of Ecuador to the international
debt market for the first time since its sovereign default and
broad debt restructuring in 2020. Reduced political uncertainty
following the presidential and legislative election in 2025,
ongoing progress with the IMF, and better availability of official
funding have allowed the country to bolster its external liquidity,
reduce sovereign spreads, and tap the global market ahead of
upcoming debt service payments.
The government has used around $3 billion (out of the $4 billion
issuance) to roll over debt and had previously announced a cash
tender offer to repurchase two outstanding sovereign bonds:
-- It repurchased $2.482 billion from the notes due in 2030.
-- It repurchased $575 million from the notes due in 2035.
S&P said, "We view the debt repurchases as opportunistic and akin
to a liability management operation. We consider that the
government would have been able to continue servicing its debt in
time and in full if the repurchase offer had not taken place."
Although Ecuador's financing needs remain high, its financing
sources have also increased, with higher availability of funds from
official entities and some market access, given that around $1
billion of the issuance was new money.
The debt repurchase is part of a broader strategy in coordination
with the IMF to consolidate fiscal accounts and regain market
access. In line with these plans, the government has taken
important actions such as increasing the value-added tax rate and
eliminating fuel and diesel subsidies.
S&P also believes that investors that accepted the offer for the
2030 bond received value equal to what they were promised when the
original debt was issued, because the government offered to
repurchase the 2030 notes at par. On the other hand, the government
repurchased the 2035 notes below par, at 90 cents on the dollar,
implying less value than originally promised, despite the offers
being done slightly above market prices.
The 2030 notes start paying amortizations in January 2026, while
the 2035 notes (that were repurchased below par) will start
amortizing in 2031, so the repurchase offer was done several years
in advance. Holders of both notes that decided not to join the
repurchase should continue to receive the amortization and interest
payments according to the original terms and conditions of the
bonds.
The 'B-' long-term sovereign credit rating on Ecuador reflects the
country's weak institutional framework, lack of monetary
flexibility, poor long-term economic performance, and high
dependence on the oil sector. Persistently high fiscal deficits and
lack of funding has led to sovereign defaults and debt
restructurings in the past, which still weighs on the rating.
Recently renewed market access could alleviate external liquidity
pressures and bolster the country's external resilience. The
country's dollarization and its lack of monetary policy reduce its
ability to manage external shocks.
=================
G U A T E M A L A
=================
ENERGUATE TRUST 2: Fitch Hikes LongTerm Local Currency IDR to 'BB+'
-------------------------------------------------------------------
Fitch Ratings has upgraded the Long-Term Local Currency (LT LC)
Issuer Default Ratings (IDRs) of Energuate Trust 2.0 (Energuate
2.0) and Threelands Energy, Ltd. Sarl (Threelands) to 'BB+' from
'BB'. The Rating Outlook is Stable following the upgrades.
Fitch has also affirmed both company's LT Foreign Currency (FC)
IDRs at 'BB+'/Stable, Energuate 2.0's senior unsecured notes at
'BB+', and Threelands' senior unsecured notes at 'BB'.
The upgrades correct errors identified within Fitch's database. On
Oct. 21, 2025, Fitch published a rating action commentary stating
that it had upgraded the LC and FC IDRs for Energuate 2.0 and
Threelands. However, the LT LC IDRs were not upgraded in Fitch's
database at that time, and these upgrade actions have corrected
this omission. Fitch has also amended the original rating action
commentary to remove the references to the LT LC IDR upgrades.
Key Rating Drivers
Energuate 2.0's upgrade and Stable Outlook assignment align
parallel actions on the sovereign, which Fitch upgraded on Oct. 14,
2025. Energuate 2.0 issues bonds on behalf of Energuate, which is
the commercial name for the combined services of Guatemala's two
largest rural electricity distribution companies. The sovereign
linkage derives from Energuate's systemic government subsidy
support and material government counterparty exposure due to the
low-income and rural service area. Energuate's financial profile is
driven by a regulated tariff that supports gross leverage (total
debt/EBITDA) of around 3.2x and adequate liquidity. Elevated
non-technical losses and security challenges temper these
strengths.
Threelands' upgrade and Stable Outlook assignment result from its
strong linkage, per Fitch's "Parent and Subsidiary Linkage
Criteria", with its primary and stronger subsidiary Energuate, with
which it is consolidated and has an open relationship. Energuate's
upgrade supports uplift at its holding company as it contributes
nearly 98% of consolidated EBITDA and represents 70% of total debt,
driving consolidated gross leverage of 4x-4.5x, and EBITDA/interest
coverage over 3x, aligned with a strong 'BB' category rating.
Energuate 2.0 serves as a proxy rating reference for Energuate and
thus is the subsidiary reference for comparison with Threelands.
Fitch rates Threelands' senior unsecured notes one notch below its
'BB' IDR due to structural subordination to operating subsidiary
debt and the risk that Energuate 2.0's loan covenants could
restrict dividends payments to Threelands, potentially impairing
interest and debt service coverage.
Corporate Rating Tool Inputs and Scores
Fitch scored Energuate Trust 2.0 as follows, using its Corporate
Rating Tool (CRT) to produce the Standalone Credit Profile (SCP):
-- Business and financial profile factors: Management (bb+, low),
Sector Characteristics (bb, moderate, Market and Competitive
Positioning (bbb, moderate), Diversification and Asset Quality (bb,
moderate), Company Operational Characteristics (bbb-, moderate),
Profitability (bbb, high), Financial Structure (bbb+, moderate),
and Financial Flexibility (bb+, moderate).
-- The quantitative financial subfactors are based on custom CRT
financial period parameters: 20% weight for the historical year
2024, 40% for the forecast year 2025, and 40% for the forecast year
2026;
-- The Governance assessment of Good results in no adjustment;
-- The Operating Environment assessment of bb- results in an
adjustment of -1.;
-- The SCP is bb+.
Fitch scored Threelands Energy Ltd. Sarl as follows, using its
Corporate Rating Tool (CRT) to produce the Standalone Credit
Profile (SCP):
-- Business and financial profile factors: Management (bb+, low),
Sector Characteristics (bb, moderate, Market and Competitive
Positioning (bbb, moderate), Diversification and Asset Quality (bb,
moderate), Company Operational Characteristics (bbb-, moderate),
Profitability (bbb, high), Financial Structure (bbb-, moderate),
and Financial Flexibility (bb, moderate).
-- The quantitative financial subfactors are based on custom CRT
financial period parameters: 20% weight for the historical year
2024, 40% for the forecast year 2025, and 40% for the forecast year
2026;
-- The Governance assessment of Good results in no adjustment;
-- The Operating Environment assessment of bb- results in an
adjustment of -1.;
-- The SCP is bb+.
RATING SENSITIVITIES
Energuate Trust 2.0:
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
-- A negative action on Guatemalas sovereign rating;
-- A significant weakening in the countrys electricity regulation
system, either through tariff adjustments or a material change in
subsidies received by Energuate 2.0;
-- Weaker operational results due to higher-than-expected energy
losses and lower-than-anticipated tariff increases;
-- A significant interference in Energuates capital structure that
results in debt/EBITDA sustained at 5.5x or greater.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
-- A positive rating action on the sovereign, in combination with
strengthening of the business profile and sustained debt/EBITDA
below 3.5x.
Threelands Energy Ltd. Sarl:
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
-- A downgrade or Outlook change for Energuate 2.0s ratings;
-- Threelands leverage debt/cash distribution sustained above 4.0x
over the rating horizon while consolidated leverage measured as
total debt/EBITDA is above 5.5x on a sustained basis;
-- An adverse deconsolidation of Threelands to primary operating
subsidiary Energuate.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
Under the current structure, an upgrade of Threelands is unlikely
without an upgrade of the primary consolidated entity proxy rating,
Energuate 2.0.
Issuer Profile
Energuate Trust 2.0 issues bonds on behalf of Guatemalas two
largest rural electricity distribution companies, DEORSA and
DEOCSA, known commercially as Energuate, serving about 2.5 million
regulated customers, or 74% of Guatemalas population.
Threelands Energy, Ltd. Sàrl is the majority owner of Energuate,
the commercial name for Guatemalas two primary rural distribution
companies, DEORSA and DEOCSA. Threelands also owns Guatemala-based
Redes Electricas de Centroamerica, S.A., and Comercializadora
Guatemalteca Mayorista de Electricidad, S.A.
RATING ACTIONS
Entity/Debt Rating Prior
----------- ------ -----
Energuate Trust 2.0
LT IDR BB+ Affirmed BB+
LC LT IDR BB+ Upgrade BB
senior unsecured LT BB+ Affirmed BB+
Threelands Energy Ltd S.a.r.l.
LT IDR BB+ Affirmed BB+
LC LT IDR BB+ Upgrade BB
senior unsecured LT BB Affirmed BB
=============
J A M A I C A
=============
JAMAICA: Jamaicans Left With 4% of Salary After Monthly Expenses
----------------------------------------------------------------
RJR News reports that the PayPulse 2025 study, conducted by the
Caribbean Society of Human Resource Professionals, has found that
most Jamaicans are left with just four per cent of their monthly
salaries after paying statutory deductions and covering basic
living expenses.
The study says once workers pay their bills, very little remains
for savings or discretionary spending, according to RJR News.
The index measures the relationship between the average monthly
salary earned by a worker and average monthly expenses for
essential items, the report notes.
An index score of 100 per cent means income equals expenses. A
score above 100 indicates a surplus, while anything below 100
signals a deficit, the report relays.
Jamaica recorded a score of 103.95 per cent, meaning the average
worker has just four per cent of income left after meeting basic
monthly costs, the report discloses.
Although Jamaica's score falls within the affordable range, it lags
far behind other Caribbean countries, the report says. Belize
recorded an average affordability score of 234 per cent, followed
by St. Kitts at 138.6 per cent, and Grenada at 136.6 per cent, the
report relays.
Research Coordinator Khayla Hamilton said the data was sourced from
official national statistics in the countries surveyed by the
Caribbean Society of Human Resource Professionals, the report
notes.
She added that while affordability remains a challenge in Jamaica,
concerns about salary competitiveness further compound the issue,
the report relays.
Hamilton noted that fewer than half of respondents in Jamaica,
Belize and St. Kitts said their salaries meet the regional average,
highlighting broader wage pressures across the Caribbean, 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.
JAMAICA: Projecting Sharp Economic Decline
------------------------------------------
RJR News reports that the Government of Jamaica is projecting a
sharp slowdown in the economy arising from the impact of Hurricane
Melissa.
In a memorandum sent to the Board of the International Monetary
Fund, the government forecasts a 4.3 per cent decline in economic
activity and inflation of 9.5 per cent for fiscal year 2025 to
2026, according to RJR News.
The document was submitted to secure approval for a US$415 million
drawdown from the IMF's Rapid Financing Instrument to help meet
urgent balance of payments needs after the storm devastated foreign
exchange earnings and the savings sector, the report notes.
The projections also show tax revenues at 30 per cent of GDP,
government spending at 33.8 per cent of GDP, and a fiscal deficit
of 3.4 per cent of GDP, the report relays.
The government expects a primary surplus of 1.7 per cent, while the
debt-to-GDP ratio is projected at 68.6 per cent, the report notes.
The current account deficit is programmed at two per cent of GDP,
while gross international reserves are expected to cover 6.7 months
of imports, the report discloses.
External debt is projected to stand at 63 per cent of GDP, 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.
===========
M E X I C O
===========
DEL MONTE: Creditors Sue Fellow Lenders Over Ch. 11 Loan Treatment
------------------------------------------------------------------
Alex Wolf of Bloomberg Law reports that the holders of senior term
loans in Del Monte Foods Corp., including Catalur Capital
Management LP, are suing a majority of fellow lenders over the
treatment of benefits tied to the company's Chapter 11 bankruptcy
financing. The plaintiffs allege that certain lenders withheld
payments to which they were contractually entitled.
Filed January 23, 2026 in the U.S. Bankruptcy Court for the
District of New Jersey, the lawsuit names Fidelity Management &
Research Co. LLC and Davidson Kempner Capital Management LP, among
others, as defendants. According to the complaint, the lenders
violated a "sharing provision" outlined in a 2024 first-out term
loan agreement, the report states.
The plaintiffs, representing about 6% of the $395 million
pre-bankruptcy term loan facility, assert that the defendants'
actions breached the agreement and caused financial harm. They are
asking the court to enforce the provision and ensure equitable
distribution of all benefits among the lenders, according to
Bloomberg Law.
About Del Monte Foods Corporation II Inc.
Del Monte Foods, Inc. produces, distributes, and markets branded
plant-based packaged food products in the United States and
Mexico.
Del Monte Foods Corporation II Inc. and its affiliates filed their
voluntary petitions for relief under Chapter 11 of the Bankruptcy
Code (Bankr. D.N.J. Lead Case No. 25-16984) on July 1, 2025,
listing $1,000,000,001 to $10 billion in both assets and
liabilities.
Judge Michael B Kaplan presides over the case.
Michael D. Sirota, Esq. at Cole Schotz P.C. represents the Debtor
as counsel.
The U.S. Trustee for Regions 3 and 9 appointed an official
committee to represent unsecured creditors in the Chapter 11 cases
of Del Monte Foods Corporation II, Inc. and its affiliates. The
committee hires Morrison & Foerster LLP as counsel. Province, LLC
as financial advisor. Kelley Drye & Warren LLP as co-counsel.
Stifel, Nicolaus & Co., Inc. ("Miller Buckfire") as investment
banker.
===============
P A R A G U A Y
===============
PARAGUAY: Remains Resilient Despite Global Uncertainty, IMF Says
----------------------------------------------------------------
The Executive Board of the International Monetary Fund (IMF)
completed the sixth review under the PCI arrangement and the fourth
review under the RSF arrangement with Paraguay.
The completion of the reviews makes available SDR 85.6 million
(about USD 117 million) to the authorities for disbursement under
the RSF.
IMF noted that Paraguay's economy remains resilient despite global
uncertainty. Real GDP growth is expected to stay robust in 2026 and
thereafter, supported by macroeconomic stability and a wide range
of reforms in train supported by the PCI and RSF arrangements.
Inflation is under control and is expected to reach the central
bank’s target of 3.5 percent in 2026, justifying a data-driven
approach to monetary policy. The external current account is
expected to weaken short-term due to FDI-related imports but should
strengthen over the medium term as new exports come on stream.
Foreign reserves remain above adequacy thresholds. Risks are
balanced, with weather shocks as a salient downside risk, and
stronger-than-anticipated FDI as a key potential upside.
Completing the fiscal consolidation plan remains essential for
maintaining macroeconomic stability. The authorities are making
steady progress towards reducing the fiscal deficit to 1.5 percent
of GDP by 2026 and remain committed to fulfilling this objective.
Continuing efforts to strengthen tax collection, enhance government
efficiency, and addressing the sustainability of the public pension
system should help create space for development priorities while
supporting fiscal consolidation goals. Efforts to improve public
financial management are welcome, and sustaining momentum in this
area is vital to reinforce credibility in fiscal policy
implementation.
Sustaining the structural reform momentum will further underpin
macroeconomic stability and foster sustainable, inclusive growth.
The authorities have advanced a comprehensive reform agenda focused
on strengthening governance and anti-corruption frameworks,
developing domestic capital markets, improving the civil service,
enhancing government efficiency and oversight, strengthening the
National Directorate of Tax Revenues, enhancing the supervision and
sustainability of private pension funds, facilitating private
investment, safeguarding property rights, digitizing the national
payment system, and bolstering resilience to natural disasters.
Continued progress with structural reforms, including sustaining
the implementation pace, is essential to further improve the
investment climate.
Staff support completion of the sixth review under the PCI and
fourth review under the RSF arrangement. The PCI remains on track
to meet its objectives despite some missed targets, given
compensating factors and the authorities' policy commitments. Based
on the completion of RM1, RM2, and RM3 in past reviews and RM5 in
this review, staff supports the authorities' request for the
disbursement of SDR 85.6 million, or approximately USD 117
million under the RSF.
About Paraguay
As reported in the Troubled Company Reporter-Latin America on
Jan. 13, 2025, S&P Global Ratings revised its outlook on its
'BB+' long-term foreign currency and local currency sovereign
credit ratings on Paraguay to positive from stable. S&P also
affirmed these ratings and its 'B' short-term sovereign credit
ratings. The transfer and convertibility assessment remains
'BBB-'.
*********
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 2026. All rights reserved. ISSN 1529-2746.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers.
Information contained herein is obtained from sources believed to
be reliable, but is not guaranteed.
The TCR Latin America subscription rate is US$775 per half-year,
delivered via e-mail. Additional e-mail subscriptions for members
of the same firm for the term of the initial subscription or
balance thereof are US$25 each. For subscription information,
contact Peter A. Chapman at 215-945-7000.
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* * * End of Transmission * * *