Successful participation in Dragon market

(Caracas, June 8, 1994).-- CAF today made the first placement of Dragon bonds by a South American issuer after successfully completing the launch of an issue on the Hong Kong and Singapore stock exchanges, which will be distributed from these centers to the Chinese People's Republic, Taiwan, South Korea and Japan.

Ten days before this achievement, CAF President & CEO Enrique García, with a high-level delegation, began a road show through four countries of Southeast Asia to promote Latin America and particularly its member countries: Bolivia, Colombia, Ecuador, Peru and Venezuela.

The official tour included a full agenda of visits to the financial markets of Taipei, Beijing, Hong Kong and Singapore, the famous “dragons,” as well as meetings with Asian investors interested in developing ties with Latin America.

The issue, for US$125 million with a five-year term, was led by the international investment bank Goldman Sachs & Co. Important financial institutions from the United States, Europe, Japan, People's Republic of China and other Southeast Asian countries also participated in the placement.

The placement is part of a broad program of participation in international capital markets, which resulted in the launch of three issues in 1993 in the Euromarket and in Japan, for a total of US$300 million at competitive interest rates and the lowest financial costs for Latin American nations.

CAF offers a high level of quality as issuer because its financial instruments are backed by three investment grades granted by the risk rating agencies Standard & Poor's, Moody’s and IBCA of the United States and Europe.

García said in a televised interview in Singapore broadcast to Asian countries that CAF participation in the Dragon market had special importance for the region because it is one more example of the confidence which Latin America is creating in the international financial community.

As example, he gave the fact that the issue was originally for US$100 million, but as a result of interest aroused among potential investors, the amount had to be increased to US$125 million.

The purpose of the placement is to generate surplus funds from this important region of the world, considered the fourth international economic block after North America, Europe and Japan, the traditional triad.

It is no longer possible -- he said -- to consider the processes of globalization and regionalization at world level without including the Pacific Basin countries in the agenda of economic discussion; so it is highly desirable for our region to foster closer relations with these countries and channel their surplus funds into our countries, as well as seeking other forms of productive linkage."