Peru on successful issue of sovereign bonds

The CAF executive president, Enrique García, congratulated the government of Peru on its recent successful bond placement, with which the country returns to the international capital market after several decades. The issue is significant because it opens alternative financing options for Peru which supplement funds from multilateral organizations and other external sources, essential for closing the gap between domestic savings capacity and investment requirements.

Given the insufficiency of multilateral and bilateral funds in relation to Peru’s needs, access to international capital markets and foreign direct investment is fundamental if the country is to achieve high sustained growth rates that generate employment and greater social development, Garcia added.

The CAF president said that in times when there is a certain degree of nervousness on international capital markets – due to the adverse international situation that has affected the risk perception of Latin America – Peru’s entry into the market on competitive conditions is beneficial for the country and can be considered a contributory factor for creating greater confidence in the region.

García mentioned that the CAF, as Peru’s principal source of external financing, has important multi-sectoral financing operations in an advance state of analysis along with the expansion of preferred creditor umbrellas for the application of innovative instruments such as partial guarantees and AB loans. These modalities will give Peru the opportunity to expand its access to private sources of international financing on a timely and competitive basis following the example of other countries in the region.