Thanks to the payment to the IMF, national public debt was reduced in April by the equivalent of US$ 1,579 million: it went from US$ 397,788 million to 396,209 million US dollars, According to data from the Ministry of Finance. That decline was achieved at the cost of a fort decrease in the central bank’s gross reserves and debt that has increased by the equivalent of US$21,971 million in the past 12 months.
“Ordinary payment debt decreased by the equivalent of $1,594 million. The change is explained by a decrease in foreign currency debt of US$ 2,063 million and an increase in local currency debt of US$ 469 million in dollars”, reads the official report.
While, the central bank’s gross reserves decreased by US$ 4,059 million in April: from US$ 39,060 million to US$ 35,001 million, with a consequent increase in net debt.
The Report indicates that of the US$396,209 million of gross debt, US$393,693 million is in a state of normal payment. And the 34% of the debt in the normal payment situation is contracted in local currency while the remaining 66% is in foreign currency.
The public debt does not include that of the Central Bank or that of the Provinces and Municipalities.
The Report adds that “over the past 12 months, the stock of gross normal-payment debt increased by the equivalent of US$21,971 million, due to an increase in foreign-currency borrowing of US$5,656 million and the increase the debt in local currency for an amount equal to US$ 16,315 million”.
Due to the payment of a principal due date, the debt to the IMF is decreased from US$46,041 million in March to US$43,443 million in April. Conversely, the debt to CABEI (Central American Bank for Economic Integration) increased from US$98 million to US$549 million and to the World Bank from US$9,256 million to US$9,271 million.
“76% of the gross debt in the normal payment situation corresponds to Treasury Securities and Effects, 20% to commitments with External Official Creditors, 3% corresponds to Transitional Advances 2 and the remaining 1% to other instruments”, he specifies the report.
Meanwhile, compared to December 2022, debt has remained almost unchanged: it has gone from the equivalent of US$ 396,555 million to US$ 396,209 million.
After the sharp increase in debt under the previous government, the debt under normal payment terms under the current government has increased from the equivalent of US$320,525 million in December 2019 to US$393,693 million in April this year : an increase of US$73,168 million, with US$12,350 million in dollars and US$60,818 million in peso equivalent, especially in securities that are adjusted for inflation or the dollar change.
While, US$5,087 million in interest has been paid to the IMF during the current government, according to Central Bank records.
The Ministry of Finance clarifies that “according to the recommendations of statistical manuals and based on international definitions, the dollar is used as the unit of account to provide comparability and standardize statistics. In this way all the values are expressed in their equivalent in dollars, applying the exchange rate of the last working day of the period to convert the outstanding debts issued and payable in: pesos, special drawing rights (SDR), euro, yen , etc.”
Charles Arterburn is a seasoned business journalist for News Rebeat, where he provides comprehensive coverage of the latest trends and developments in the world of finance and economics.