The government of President Bernardo Arévalo made its debut in the international financial market on Monday, July 29, by awarding a quota of US$1.4 billion that will be used to finance programs in the 2024 state budget, the Ministry of Public Finance (Minfin) reported.
This is the first placement of external debt through Eurobonds issued by the current Government administration.
As anticipated by the Minfin authorities, two placement tranches were completed on Monday: one for US$800 million over a 12.5-year term, with a coupon rate of 6.55% at par, and a demand of US$3,182 million; and the other through the traditional Eurobond market that raised US$600 million, over a 7-year term, with a coupon rate of 6.05% at par, and a demand of US$2,390 million.
In accordance with the established norm, the Minfin will receive the resources in the next few days and will allocate them to finance different programs that identify, as a source of financing, the bondable debt.
“Guatemala has placed ESG (Environmental, Social and Governance) bonds on the market for the first time, with the aim of raising international funds committed to the implementation of public policies related to the eradication of poverty and chronic malnutrition; the improvement of health and education; the promotion of decent jobs and sustainable economic growth,” said a statement from the Minfin.
“Guatemala has published its Sustainable Finance Framework as part of a comprehensive strategy designed to harness the power of finance to drive sustainable development. By integrating green and social spending into our financing, we seek to attract investments that promote renewable energy, sustainable water, security and sustainable food systems; affordable housing, access to essential services and other critical areas. You play a crucial role in this effort,” President Arévalo told investors, according to Minfin.
He added that the Minister of Public Finance, Jonathan Menkos Zeissig, reiterated to investors that the Government of Guatemala is committed to the development of a prosperous, inclusive and environmentally sustainable economy.
He added that, in this context, the Sustainable Financing Framework was created, which received a “Very Favorable” opinion from the rating agency Moody’s Investor Service, confirming its high contribution to sustainability.
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