The Council of Bogotá finally approved this week the debt quota of $9.5 billion that Mayor Carlos Fernando Galán had been requesting to carry out several projects. of infrastructure and social in the city and an additional one for $3.5 billion for TransMilenio.
In dialogue with Portafolio, the Secretary of the Treasury, Ana María Cadena, explained what this guarantee involves and gave some peace of mind to citizens regarding the fiscal effects of the debt space acquired, making it clear that the country’s capital enjoys good image before the monetary authorities and that fiscal stability will not be affected.
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What balance remains of the approval?
It is very good news and it is a very important step to make our District Development Plan ‘Bogotá Walk Safe’ a reality, since since we presented it, we announced that one of the sources of financing required was a new debt quota. So the approval that was given yesterday in the Council is a very important step to make all our city goals a reality.
Was it a good time to approve it?
At this time we do not see risks that cause us major concern. Of course, we are very attentive and following up on our collection all the time.
At this moment we have already met 84% of the goal and we hope that these last two months will have a good performance, also because until December 13 we will have tax relief and that seeks to recover portfolio for the District, giving to the citizens and the taxpayers the opportunity to catch up with Bogotá with an 80% discount on interest and penalties. So, we hope that this will also cause collections to rebound and we can meet that goal.
Ana María Cadena, Secretary of the Treasury of Bogotá.
Courtesy – Hacienda Bogotá / API
And the low debt margin?
When we came to this administration, the Junction Commission informed us that there was room for a debt quota, which they more or less anticipated at $5.6 billion. However, two factors were fundamental for this to change for the better; The first thing was that when observing a closing of the income for the year 2023, it was evident that a better performance than expected.
The other has to do with the sustainability indicator, which when informed by the Splicing Commission, reached its highest point, 86%, and now we have managed to place it in a range close to 39%, which in any case is lower and let’s say that it gives us peace of mind, because it is not getting so close to 100% which is what the law establishes.
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These two issues, greater income and allowing the indicator three additional percentage points, were what allowed us to responsibly and sustainably bring this level of debt quota to the Council of Bogotá.
How will the quota be used?
This is a global quota, although let us make it clear that there is an indication of that quota, which was discussed in very detail with the Council, which gave us observations that they do not appear explicitly, but it seems very important to me to clarify, given that if Although there is no direct mention, this does not mean that they are not being considered.
What is being done here is determining from what source certain things are financed and that is why, in 77%, this quota would go to infrastructure issues. Mobility infrastructure, but also health infrastructure, education, culture, in terms of parks. We have the Creative Transit District, for example.
The rest?
16% goes to habitat, where we want to strengthen the entire new housing subsidy program, comprehensive improvement of neighborhoods and revitalization of environments, because that is an important commitment of this administration. Since last week, other fairs have been taking place where thousands of families interested in accessing this issue of housing subsidies have attended.
Bogotá Council
EL TIEMPO Archive
Finally, we have around 7% in each security issue, so, the new district prison, a new URI, the strengthening of our command center, the C4, and those are the examples of the projects that we want to finance with this quota .
How will the debt be issued?
This question leads me to make a very important clarification, and that is that the fact that we have been approved for a quota does not mean that at this moment the city is in debt of $9.6 billion or more. That said, we will have to go to the market to see what the best conditions are offered to, depending on the need, disburse debt.
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In this way, we resort to the different possible mechanisms. We are thinking about issuing a bond next year, but we are also turning to commercial banking, both internal and external. Multilateral banks have also made us offers to support us and access the city’s debt.
This is why we will be reviewing, we are open to all possibilities, both in internal and external debt and we know that Bogotá, having a triple A rating internally and international investment grade, can access good rates. So that is the exercise we will have to do going forward.
Panoramic of Bogotá.
EL TIEMPO Archive
Does the green frame come in here?
Yes, it can be used. For example, we have a very important line of sustainable mobility and interest could be made there within the framework of the issuance of a green bond. I would like to take this opportunity to remind you that less than two weeks ago we launched our green, social and sustainable bond reference framework and the idea moving forward is to be able to use it for the city to advance on these types of fronts.
We must take advantage of the fact that when the credit risk rating agencies reviewed us in June and August of this year, we showed them that within our financial application it was to have this new financing and that is why the review they did already included this quota and Even so, they rated us well internationally. There I think there is a message of tranquility.
