The Debt Management Unit (UGD) of the Ministry of Economy and Finance (MEF) estimates that by 2023 The financing needs of the central government will be about US$4,094 million.
This figure includes US$1,832 million in bond amortizations and loans with multilateral organizations, interest payments for US$1,712 million, and a primary deficit of US$190 million, according to the latest sovereign debt report.
There are approximately $3.67 billion that will have as a source the placement of international bonds and in the domestic market (first semester calendar published). The other sources of financing will be the disbursement of credits from international organizations for US$350 million and others (US$74 million). The net issuance of bonds (that is, deducting the amortization of titles) is projected at around US$ 1,828 million.
The last history of Uruguay in the international debt markets dates back to October of last year. On that occasion, the country successfully placed the first Bond Indexed to Climate Change Indicators (BIICC) denominated in dollars maturing in 2034and whose interest rate is linked to compliance with the achievement of environmental performance objectives.
Last November, the director of the Debt Management Unit of the Ministry of Economy and Finance (MEF), Herman Kamil told The Observer that it is expected to go out “at least” once a year to the foreign market with the issuance of a global bond and then “be supported” by the domestic investor base, which was very important for Uruguay during the pandemic.
MEF
At the end of the third quarter of 2022, the government’s liquid assets were US$1,570 million and credit lines with multilateral organizations (Inter-American Development Bank, Andean Development Corporation and Latin American Reserve Fund) totaled US$1,515 million.. The figures for 2023 are likely to have some adjustment in the coming weeks when the first debt report for this year is published. For the year 2023, the Ministry of Economy projects a fiscal deficit equivalent to 2.6% of GDP.
Uruguayan debt has an investment grade rating from the five risk rating agencies. The R&I agency places it two notches above the minimum (BBB+) with a stable outlook, while Standard & Poor’s (BBB), Moodys (Baa2) and DBRS (BBB) place it one notch above the minimum with a stable outlook. Meanwhile, Fitch Rating (BBB-) places it at the minimum, with the addition that the latter improved its outlook from negative to stable in June 2022.
