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El Salvador is a country with an extremely high public debt and, according to data from the Central Reserve Bank, this increased to $1,330 million dollars in the last year.
According to data from the Central Reserve Bank, with this increase today the Salvadoran public debt amounts to $24,586.36 million dollars as of last June, exceeding 5.7% to that registered in the same period of the previous year.
In order to meet some financial commitments, the Government authorized the purchase of debt, however, says the economist and researcher at the UCA, Julia Evelyn Martínez, the funds for this purpose will lead the Executive to misuse some loans.
And it is that buying debt for $265 million dollars with special drawing rights with funds from the International Monetary Fund will automatically generate interest payments to the IMF. According to Martínez, this is because the government has not used it to maintain international reserves.
To this must be added that the country has misused a loan from the Central American Bank for Economic Integration for more than $200 million dollars to purchase the country’s sovereign debt, says the economist. This loan was intended to finance the payment of the subsidy to keep fuel prices stable.
With all this background, says Julia Evelyn Martínez, the purchase of debt from the country will be extremely expensive and with it the budget of the Republic will be reduced and the great majority will be affected.
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