Uruguay is likely to tap bond investors for up to $2bn in Q3 or Q4 this year, sources told LatinFinance, after the South American sovereign avoided the Q1 bond rush to start 2017.
Baa2/BBB/BBB- rated Uruguay will also seek up to $500m in loans or use its domestic reserves to finance a pipeline of infrastructure projects.
Fitch Ratings last week affirmed the country’s rating, but highlighted Uruguay’s deteriorating public finances.
Despite this, one fixed income investor doubted that Uruguay would encounter any difficulties in issuing new debt, owing to strong economic fundamentals when compared to neighboring sovereigns.
In October, the sovereign announced the creation of a $350m 30-year fund to develop infrastructure PPPs. Total investments could reach $12.5bn over the next five years.
Government-operated entity FF Corporacion Vial del Uruguay (CVU) is also in talks for a $450m bond sale, after Moody’s gave the company a Baa3 rating on a potential sale.
Uruguay raised $1.2bn in 2027 bonds in November 2015.