Paraguay may issue sovereign debt again in 2014 once it has passed a more balanced budget, the country's new finance minister said on Monday, signalling no rush to follow up a successful debut in global credit markets this year. Finance Minister German Rojas told Reuters his priority was shoring up Paraguay's fiscal deficit and keeping spending under control despite the temptations of surging economic growth.
"First we need to put our house in order," said Rojas in his first formal interview since joining the center-right government of Horacio Cartes, a cigarette and soft drink magnate who took office last week. "We can think about (issuing debt) next year and afterwards, because our mission now is establishing a more balanced budget, with more austere policies in some cases," Rojas added.
Paraguay, one of South America's poorest nations, made its debut in global credit markets in January, selling $500 million in 10-year international bonds as it took advantage of investor appetite for riskier emerging-market debt. The debt offered a yield of 4.625 percent, undercutting the 4.875 percent yield of neighbouring Bolivia at its October debut. Paraguay lured investors with its promising growth outlook and modest public debt levels, but Rojas said he does not expect to see such favourable market conditions again soon, due to the prospect of rising interest rates in developed economies.
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