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The Legislative Assembly of El Salvador approved, with 57 votes, to authorize the central Government (through the Ministry of Hacienda) the management of up to US$100 million through the issuance of Credit Securities, which can be placed on both the national and international markets.
According to official information, these financial instruments will allow the State to obtain resources to meet different strategic priorities in short and medium term. The funds will be available for this next fiscal exercise and can be allocated to initiatives in social, environmental and economic sectors.
Credit Value Titles are deed instruments that the Government issues to raise financing from investors, which acquire these documents in exchange for receiving income within a specified period. In this case, the approved legislation establishes conditions that seek to make them more attractive to the market.
Among its main characteristics, it stands out that both the nominal value and the income generated will be free from taxes, fees and contributions, which increases its competitiveness compared to other investment options.
Accordingly, flexibility is included in the form of payment. The State may amortize the debt through periodic installments during the term of the instrument or make a single payment at maturity, according to the conditions that are defined in each issue.
The authorization also allows these securities to be placed on international markets, which expands the universe of potential investors and facilitates access to financing under competitive conditions.
With this measure, the Legislative Assembly seeks to provide the Executive with financial tools that allow it to manage resources in a timely manner and meet the country’s diverse needs, maintaining flexible alternatives for fiscal planning.
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