Guatemala's government will issue $300 million in 10-year bonds on international markets in September to help cover this year's budget deficit, the Central American country's finance minister said on Friday.
The government hopes to place the debt at a yield no higher than 8.5 percent, Finance Minister Maria Antonieta de Bonilla told reporters. Guatemala sold $300 million into markets in July 2003 at a yield of 9.25 percent.
De Bonilla said the government would also place $50 million in dollar-denominated debt in local markets, and another $200 million worth of debt denominated in the local currency, the quetzal.
Guatemala's budget deficit is expected to reach $800 million this year, or about 2 percent of gross domestic product. The government plans to cover the rest of the gap with new taxes and a $125 million cut in spending on public works projects.
President Oscar Berger took office in January, and Wall Street analysts say his business-friendly economic agenda has awakened investor interest in a country still recovering from a 36-year civil war that ended in 1996.
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