Colombia will seek to issue as much as $500 million in foreign bonds by June to help finance this year’s budget deficit, Patricia Moreno, the finance ministry’s head of external financing, said.
“It’s impossible for us to estimate what market window we will have but we will try and get those US$500 million issued before June,” Moreno said during a conference call with investors today.
President Alvaro Uribe’s government also plans to auction as much as COP13 trillion (US$6.6 billion) worth of peso- denominated bonds known as TES in 2010, and borrow US$1.75 billion from multilateral lenders, Finance Minister Oscar Ivan Zuluaga said on January 18. In 2009, the government sold $2 billion of bonds to finance this year’s COP148.3 trillion budget.
The bond sale comes as Colombia plans to cut 5.9 trillion pesos from the budget in a bid to contain a widening deficit as tax revenue falls, Zuluaga said. The cuts will help the government meet this year’s consolidated budget deficit target of 3.7% of gross domestic product, which compares with 2.7% last year. The central government deficit will rise to 4.5% of GDP from 4.1% in 2009, Zuluaga said. (Helen Murphy, Alexander Cuadros, Bloomberg)