In less than four months, the Nayib Bukele government has already added a short-term debt of $ 604 million, through Treasury Bills (Letes), after yesterday’s placement of $ 46.3 million.
The executive’s statement was that they will lend him 107,220,700 dollars on the stock market, but at the end of the day, what he obtained was 46,300,100 dollars, according to the information on the El Salvador Stock Exchange portal.
This loan, which must be repaid within 360 days, was placed at a rate of 7.3%.
This latest placement is in addition to those already made in the first three months of the year, which amounted to $ 557.7 million.
SEE ALSO: The law obliges AFPs to lend workers’ money to the government
According to data from the Stock Exchange, between March 2 and 25, the Treasury made four investments of Letes and another certificate of treasury (Cetes), which totaled 388,346,000 dollars.
In total, the Government made eight investments between January and March, which keep short-term debt at the limit, as for this year the Legislative Assembly authorized the Bukele government a short-term debt limit that does not exceed 25% of current income in 2021.
This type of debt through Letes and Cetes does not require the approval of the Legislature and is similar to a credit card for the government, which is capped at $ 1,424,126,968 million for 2021.
For this reason, the government had to pay in installments to repay the loans. For example, on March 23, the government borrowed $ 115 million and made a payment of $ 125 million the day before; then on March 24 he paid another $ 125 million back and on March 25 he borrowed $ 136 million.
For public finances, last month was one of the most critical in the first quarter of the year, as it had to pay $ 328 million. And while he only has to pay $ 46 million this month, he already borrowed $ 46.3 million in Letes on Tuesday.
Then, in the third quarter of this year, comes another difficult month for state coffers, as the Treasury has to pay $ 94 million in Letes in September and also has to pay $ 645.8 million in Cetes. , which were borrowed on September 21, 2020.
Little margin to borrow
According to data from the Central Reserve Bank (BCR), by February this year, the government is accumulating a debt of $ 1,323.70 million in Letes.
This amount implies a 26.08% increase in short-term debt, as in February 2020 the debt in government securities was USD 1,049.86 million.
The level of debt payable within a year leaves little room for the government to obtain more loans. In fact, yesterday’s placement reflects the fact that the stock market did not agree to lend him everything that the Executive asked for.
In total, the Treasury is required to pay $ 1,724.5 million this year in treasury bills and treasury certificates that have different maturities throughout this year.