Elon Musk talks to Javier Milei after crossed messages on social networks

 December 07, 2023

Source: Forbes

 September 21, 2022

The President of Argentina, Alberto Fernandez, delivered a speech on Tuesday at the United Nations General Assembly in the United States. In this regard, Fernandez based his speech on the state of democracy worldwide and warned that democracy is in danger. He also said, "there is no problem with the democratic right wing, but the right wing that promotes hatred and violence should have no place in the world we live in." Likewise, the President mentioned the assassination attempt against the Vice-President of Argentina, Cristina Kirchner, and the war between Russia and Ukraine. In this context, Fernandez highlighted the impact of the war in Ukraine worldwide and in Latin America. During his stay in the United States, the President held bilateral meetings with the Prime Minister of Portugal, António Costa; the President of France, Emmanuel Macron; and the President of Spain, Pedro Sánchez; meetings in which global energy and food issues were discussed. Additionally, Fernández will give a presentation to different oil-related business people to attract investments in the hydrocarbon sector in the country.

Meanwhile, the Foreign Minister of Argentina, Santiago Cafiero, met with the Minister of Foreign Affairs of India, Subrahmanyam Jaishankar, to discuss issues of food security, the fight against climate change, and the relationship between the Community of Latin American and Caribbean States (CELAC) with India.

Sources: Telam, Telam, Cronista

 September 21, 2022

After the entry into force of the Export Increase Program in the country for the soybean complex, studies by the Buenos Aires Grain Exchange indicate that the country's soybean producers have commercialized a total of 9.5 million tons. In this sense, the measure was implemented by the Argentine government with the aim that the leading exporters of the soybean complex in the country commercialize soybeans, delivering the dollars to the Central Bank, which indicated that it expects to achieve an accumulation of international reserves of USD 5 billion in September for the program. In this context, after Monday's trading day, the BCRA stated that it had accumulated a total of USD 2,350 million in the last ten trading days, following the implementation of the special exchange rate of ARS 200 for the country's soybean exports.

Meanwhile, according to Bloomberg, China has increased its soybean purchases from Argentina following the Argentine government's implementation of the Export Increase Program. As stated by Chinese government sources, in 2021, the country imported about 3.75 million tons of soybeans from Argentina, while, so far in 2022, China has already imported about 3 million tons.

Sources: Telam, Yahoo

 September 20, 2022

The Managing Director of the International Monetary Fund (IMF), Kristalina Georgieva, highlighted the progress made by the Argentine economy regarding the goals of the Extended Facilities Program with the entity and pointed out that in 2023 the goals of the agreement could be modified. In this regard, Georgieva said, "We must analyze the issue of the goals in terms of the program, progress, and conditions for how it is implemented so that Argentina can benefit as much as possible." In addition, she highlighted the work of Sergio Massa as the country's Minister of Economy since his appointment and noted that Massa's team is "addressing Argentina's significant challenges."
In this regard, Georgieva affirmed that the Argentine government is committed to meeting the program's goals and stated, "The focus is on addressing the deficit's triggers and energy challenges." In this context, the Deputy Director of the Western Hemisphere Department and Chief of Mission for Argentina, Luis Cubeddu, assured that the program's targets will remain unchanged in 2022 and stated that "the key objectives established at the time of the approval of the agreement, including those related to the primary fiscal deficit and net international reserves, will remain unchanged until 2023." Furthermore, he pointed out that the only objective of the agreement that was not met in the second quarter review was the accumulation of international reserves.

Source: BaeNegocios, Telam

 September 20, 2022

The Argentine government must face two maturities this week with the International Monetary Fund (IMF), corresponding to the Extended Facilities Program. In detail, the government must pay a total of USD 2,622 million this week, of which USD 895 million is due on Wednesday and USD 1,727 million on Thursday. In this sense, the government's objective is to pay the maturities before the IMF disburses a total of USD 3,900 million to the country for the second review of the program with the entity. According to official sources of the Argentine government, the BCRA managed to accumulate around USD 3,000 million due to the so-called "soy dollar." In this context, the Congressional Budget Office (CBO) indicated that the government must meet maturities for a total of USD 4,082 million in September.
Meanwhile, the President of Argentina, Alberto Fernandez, ratified the appointment of Miguel Pesce as the President of the Central Bank of the Republic of Argentina (BCRA) until 2028. Likewise, Fernandez also confirmed the ratification of other members of the BCRA's Board of Directors; the First Vice-President of the BCRA, Sergio Adrian Woyencheszen; the Second Vice-President of the BCRA, Jorge Carrera; Directors Alberto Biagosch, Claudio Martin Golonbek, and Betina Susana Stein.

Source: Ambito, El Economista

 September 19, 2022

The Public Administrator of the Social Security will manage a fund of USD 23,240 million, which currently remains in the hands of Future Pension Fund Administrators (AFP) and the BBVA. This amount corresponds to the insured individuals' contributions to the Comprehensive Pension System (SIP) that until now was managed by these two private entities and will pass into the hands of the State.
According to data from the Pension and Insurance Supervision and Control Authority (APS), the market value of the insured individuals' contributions is USD 23,240 million, adding that these resources will be administered as of May 2023 by the new Administrator.

Source: El Deber

 September 19, 2022

Last week, the Argentine government delivered the draft 2023 Budget to the Argentine Chamber of Deputies. The draft provides for an overall expenditure of about ARS 29 billion, a growth of 2% of the Argentine economy, an estimated inflation rate of 60% in 2023, and a reduction of the fiscal deficit from 2.5% to 1.9%. In detail, the 2023 budget estimates a total expenditure of ARS 28,954,031 million for current and capital expenditures of the General Budget of the National Administration for that year. 

It is worth mentioning that the project has already been signed and reviewed by the President of Argentina, Alberto Fernández, the Chief of the Economic Cabinet, Juan Manzur, and the Minister of Economy, Sergio Massa. In this regard. Argentine government officials consulted by Telam stated that the 2023 Budget aims at the stability of the country's economy and remarked that "the budget being presented aims at macroeconomic stability, the recomposition of the purchasing power of income and the strengthening of the domestic market." They added, "Advancing in fiscal order will allow the government to reduce the monetary financing of the deficit, which will lead to a situation of fiscal solvency." Additionally, official Argentine government sources assured that the administration also aims to stimulate private investment to encourage the generation of employment and strengthen the country's external sector.

Source: Telam

 September 16, 2022

Argentina's Ministry of Economy announced the new draft of Budget Law 2023. According to the Ministry's officials, the new budget bill's central axis establishes the reduction of the fiscal deficit to 1.9%, an inflation rate of 60% at the end of 2023, and a level of economic growth of 2% for that year. In this sense, the head of Argentina's economic cabinet, Juan Manzur, assured that the 2023 budget proposes to boost investments in the country and stated, "I can assure you that, in a challenging international context, we maintain our commitment with the Argentine people to increase investment in strategic issues for our country, such as public works, education, science, and technology." He also said, "We are open to reviewing and modifying the draft budget to achieve the broad agreements that the country needs."
Meanwhile, the Minister of Economy, Sergio Massa, indicated that the draft budget for 2023 seeks to meet the objectives of the Argentine government concerning the International Monetary Fund's (IMF) Extended Facilities Program. In this regard, Massa affirmed the government's commitment to comply with the goals of the agreement in 2022 and stated, "we are going to comply with the 2.5% primary deficit goal of the national public system established by the budget that we had to approve with the Necessity and Urgency Decree (DNU) after Congress rejected it." 

Sources: Telam, Ambito

 September 16, 2022

On Wednesday, the National Institute of Statistics and Censuses (INDEC) revealed Argentina's inflation rate for August, which stood at 7% and represented a deceleration from July's inflation rate of 7.4%. Likewise, in the last 12 months, the country's inflation rate accumulated 78.5%. According to the INDEC, the main items that drove the inflation rate up in August were clothing and footwear, with an increase of 9.9%, miscellaneous goods and services with 8.7%, and household equipment and maintenance with 8.4%. It should be noted that the main driver of the inflation rate in the country's different provinces was the food and non-alcoholic beverages item, with an incidence of 7.1%. Further studies have indicated that August's inflation rate would carry over to September and stated that "the dynamics of the first days of September, and the increases already established for September, such as domestic services, prepaid services, electricity, and gas, among others, anticipate an inflation rate of around 6.3% ."
Meanwhile, the Market Expectations Survey (REM) for August 2022 indicated that the projections for 2022 in terms of inflation are at 95%, 84.1% for 2023, and 63.1% for 2024.

Source: Ambito

 September 15, 2022

The Secretary of Industry and Productive Development, José Ignacio de Mendiguren, stated that the Argentine government requires a "political agreement" to face the country's inflation. In this sense, Mendiguren highlighted the Argentine government's work to fight inflation in the country and remarked, "the Secretariat of Commerce is working to prevent price abuses, to build from another base; we hope that the agreements will be successful and that the future can be planned without transferring all the past to prices." In this context, the President of the Banco de la Nación Argentina (BNA), Silvina Batakis, pointed out that it will take decades for the Argentine government to solve the inflation problem.

Meanwhile, the Secretary of Energy, Flavia Royon, stated that the Argentine government's tour in the United States left several "lines of work" established with different companies in the hydrocarbons sector, such as Exxon, Pan American Energy, Chevron, and Total Energy. In this sense, Royon affirmed that the objective of the lines of work is to continue with the development of the hydrocarbon complex in the country, especially the development of the Vaca Muerta field. In this regard, Royon stated, "we met with the main hydrocarbon companies to make investments in the country." In addition, he highlighted the commitment of different companies in the hydrocarbon sector to continue developing the Néstor Kirchner gas pipeline.

Source: Telam, El Economista, Telam

 September 15, 2022

After she met with Argentina's Minister of Economy, Sergio Massa, the head of the International Monetary Fund (IMF), Kristalina Georgieva, highlighted the commitment of the Argentine government to comply with the Extended Facilities Program with the entity. In this regard, Georgieva said, "I was impressed by the team's composition. Massa participated in the meeting together with the President of the Central Bank of Argentina (BCRA), Miguel Pesce, and key members of his team, and that is a good sign that the whole government is focused on implementing the program." In this regard, the head of the IMF highlighted Sergio Massa's work as Argentina's Minister of Economy since he took office and affirmed "he recognized, with seriousness, the problems Argentina is facing;" furthermore, after she met with Massa, she said, "I left with the feeling that we have a partner with whom we can work well."

After his U.S. tour, Minister Massa also highlighted his meeting with the President of the Inter-America

Source: Telam

 September 14, 2022

Argentina and the International Monetary Fund (IMF) will continue to negotiate a disbursement this week within the framework of the credit program signed with the multilateral organization, according to the Managing Director of the Fund, Kristalina Georgieva, after meeting in Washington with the Argentine Minister of Economy, Sergio Massa. "Our teams will continue meetings virtually this week" in search of an agreement "in the coming days," Georgieva said in a statement. At a press conference, Massa assured that as of Friday, the documentation would be ready to be transmitted to the IMF's Executive Board, which validates the conclusions of the technical negotiations. 
Georgieva described the meeting with the Argentine Minister as "very positive," after a week of "productive and highly professional meetings" between the "technical teams," and praised "the strong steps" taken by Argentina to "stabilize the markets and reverse a scenario of high volatility." According to Georgieva, Massa "expressed his clear intention" to stabilize the Argentine economy and ensure sustainable growth "under fiscal order and strengthening of reserves." The government must increase its international reserves and reduce the fiscal deficit from 3% of the Gross Domestic Product in 2021 to 2.5% this year, 1.9% in 2023, and 0.9% in 2024, based on its commitments with the multilateral organization.

Source: SwissInfo

 September 14, 2022

Argentina's Minister of Economy, Sergio Massa, is planning another international trip at the end of the month, on September 29 in France, where he will seek to reach an agreement with the Paris Club. This was confirmed to Ámbito during his tour in the United States. "We already have a proposal to make to the Paris Club that allows Argentina to project its payments together with those of the IMF," said Massa in declarations to this media company. Meanwhile, sources from the economic team accompanying him on his tour in the United States said that the conversations have been taking place with the entity for some weeks and that it is estimated that Massa's visit will give a different sense of what the agreement could be. According to Ámbito, a new extension will not be requested, and it is estimated that there should already be an agreement before the expiration of the current one.
The Minister of Economy closed his visit to the United States with a meeting in Washington with the Secretary of the Treasury, Yanet Yellen, which was read as a sign of support to his administration, and another one with the Managing Director of the IMF, Kristalina Georgieva, with whom he made progress in the analysis of the second review of the agreement with the multilateral organization.

Source: Ambito

 September 13, 2022

On Monday, Argentina's Minister of Economy, Sergio Massa, met with the U.S. Treasury Secretary, Janet Yellen, and her advisor, David Lipton. The team accompanying Minister Massa included the Secretary of Economic Programming Policy, Gabriel Rubinstein, the President of the Central Bank of Argentina (BCRA), Miguel Pesce, the Ministry's Chief of Advisors, Leonardo Madcur, the Director of the National Institute of Statistics and Censuses (INDEC), and the Coordinator of Relations with Agencies, Marco Lavagna, and the Argentine Ambassador to the United States, Jorge Argüello. According to official sources from the Argentine government, the heads of Argentina and the United States "discussed the global context and the challenges that the war represents for the world and Argentina in particular, understanding that the war damaged the country's fiscal situation and international reserves." They also pointed out that the agenda of the meeting also dealt with food and energy security issues.

Meanwhile, Massa pointed out that the second review of the goals of the Extended Facilities agreement with the International Monetary Fund (IMF) is in progress and indicated that the progress of the program depends on the votes of the multilateral organization's Executive Board.

Source: Telam

 September 13, 2022

The President of Argentina, Alberto Fernández, will travel to the United States on Saturday, where he will participate in the United Nations General Assembly and hold bilateral meetings with five different countries. In addition, Fernández's meeting with the President of the United States, Joe Biden, has been postponed. According to official sources from the Argentine government, President Fernandez will hold bilateral meetings with the Presidents of France, China, Japan, India, and Chile. It should be noted that President Fernandez's agenda is still open, and more meetings are expected to be added during the trip. In addition, the President will be accompanied by Argentina's Ambassador to the United States, Jorge Argüello, Argentina's Ambassador to the United Nations, Marilita Squeff, the Secretary of the Presidency, Julio Vitobello, and Argentina's Foreign Minister, Santiago Cafiero. President Fernández's objective during the trip is to highlight to the international community Argentina's potential to supply the global food and energy markets amid a complicated international context derived from the war between Russia and Ukraine.

Meanwhile, in the bilateral meetings, Fernández will discuss different topics, such as the agreements between the European Union and Mercosur with the President of France, Emanuel Macron, a new Swaps line with the President of China, Xi Jinping, and the promotion of investments in Argentina with the President of Chile, Gabriel Boric. Fernández is also scheduled to meet with the Prime Minister of Japan, Fumio Kishida.

Source: Cronista

 September 12, 2022

Next Wednesday, the National Institute of Statistics and Censuses (INDEC) will reveal the Consumer Price Index (CPI) for August. According to market forecasts, it is estimated that the CPI will be above 6%, which would mean a reduction of 7.4% in July's inflation rate. In this sense, studies indicate that the price increase in August was mainly driven by the rise in food prices, rents, and fuel prices. In this regard, the analysis revealed that the items with a higher price level were transportation and communications, with a 40% increase, while food increased in August by about 7.5%. In this context, the accumulated inflation rate was around 50% in the first eight months of the year.
The Market Expectations Survey (REM) of the Central Bank of Argentina (BCRA) estimates that the inflation rate in August will be 6.5%. Meanwhile, projections for the next months of the year indicate that the inflation rate is expected to be 6% in September, 5.7% in October, 5.5% in November, and 5.8% in December.

Source: Ámbito

 September 12, 2022

After the first week of implementing the Export Increase Program for the country's soybean complex, the President of the Chamber of the Oil Industry and Grain Exporters Center (Ciara-CEC), Gustavo Idígoras, indicated that the sector exceeded market expectations with around 4.3 million tons of soybean in operations, equivalent to USD 2,200 million from the exporting sector. In this sense, Idígoras stated that "the first week of the launching of Decree 576 has been quite positive. Producers have sold a volume of over 4 million tons. This means that in five days, the volumes sold by producers in the whole month of August doubled." He also remarked that "market reactions were favorable, with interested producers, stockpilers, brokers, and cooperatives being very active." 
It is worth mentioning that in the first three days of the program, the first goal of the Minister of Economy, Sergio Massa, of USD 1,000 million, was exceeded. In this regard, the economist at the Grain and Products Exchange of Bahía Blanca (BCP), Carolina Volonté, assured that the country's ports are capturing a greater flow of trade and said, "During the Program, operations with the delivery place in Bahía Blanca exceeded 264,000 tons, well above the 657 tons negotiated in August. We can also add an active shipment program from our port, with 170,000 tons for the next 15 days."

Source: Telam  

 September 09, 2022

Argentina's Minister of Economy, Sergio Massa, presented the Argentine government's economic plan to the World Bank (WB) with which it intends to stabilize the country's economy and increase the Central Bank's international reserves. After the presentation of the economic plan, the WB officials announced the approval of a USD 900 million loan for the country in the next six months, in addition to the USD 1.1 billion already approved for the country in 2022. In detail, the WB agreed to disburse close to USD 500 million before 2022 for infrastructure projects and the country's health system. In this regard, WB officials reaffirmed the entity's commitment to the country "to promote inclusive and sustainable development."

Meanwhile, the President of the Inter-American Development Bank (IDB), Mauricio Claver-Carone, also affirmed the institution's commitment to Argentina at the beginning of the week and assured that the institution would provide around USD 3 billion in financial support to the country until the end of the year. In this context, Massa said, "The agreement reached with the IDB is the result of the articulated work to achieve a Special Financing for Development package that will allow Argentina to implement key programs in infrastructure, health, water, and tourism."

Source: Ámbito

 September 09, 2022

After the announcement by the Minister of Economy, Sergio Massa, of the so-called "soy dollar" for the Export Increase Program, the Chamber of the Oil Industry and the Grain Exporters Center (Ciara-CEC) announced that in the first three days of the decree, the country's soybean complex had generated around USD 1,075 million in income, which exceeded the goal set by Massa (USD 1,000 million) at the beginning of the program. Thus, the Secretary of Agriculture, Livestock, and Fisheries, Juan José Bahillo, assured that the program exceeded the government's expectations and indicated that it could generate more than USD 5 billion by the end of September.
 
In this regard, Argentine government officials remarked on the program's success and stated, "the US$ 5 billion is a floor; we believe that this amount will be exceeded." According to data from the Rosario Stock Exchange (BCR), in the first two days of the program, the soybean complex's offering and trading operations exceeded 2.13 million tons; additionally, the entity stated, "This figure is 68% higher than Monday's, bringing the total soybean business registered to 2.13 million tons in only two days since the Export Increase Program came into effect."

Source: Ámbito

 September 08, 2022

After meeting with the head of the Inter-American Development Bank (IDB), Mauricio Claver-Carone, Argentina's Minister of Economy, Sergio Massa, announced that the entity would resume operations with the country and stated that "the IDB will reopen the relationship with Argentina and provide more than USD 3 billion in 2022." According to Argentine government officials, the entity will grant around USD 1,200 million for the accumulation of the country's international reserves, about USD 500 million at the end of September and USD 700 million at the end of December. In addition, the entity will grant approximately USD 1,933 million before the end of the year. Meanwhile, in 2023, the IDB is expected to contribute around USD 1,800 million during the first quarter of the year. 

In this context, the Minister remarked, "I would like to thank Mauricio Claver-Carone and the IDB for the work articulated with our economic team during the last two weeks, which allowed us to advance in a fundamental axis of the proposed roadmap, which is to strengthen the country's reserves." He also stated, "we took an important step toward consolidating the relationship between Argentina and the IDB, not only strengthening reserves but also guaranteeing finance for the State to carry out road works, infrastructure, housing construction, among other programs." Additionally, Argentine government officials indicated that the IDB's announcement impacted the International Monetary Fund's (IMF) outlook regarding fulfilling its program goals for the third quarter.

Source: El Economista

 September 08, 2022

On Wednesday, the Argentine ambassador to China, Sabino Vaca Narvaja, announced that the President of Argentina, Alberto Fernandez, had requested in a letter to the President of China, Xi Jinping, the formal request for the inclusion of the country in the block of countries integrated by Brazil, Russia, India, China, and South Africa (BRICS). After the request was announced, the Argentine ambassador said, "the Argentine government has a clear position regarding the BRICS. For us, the group is an excellent alternative for cooperation due to a world order that has proven to be created by and for the benefit of a few. I am convinced we are facing a historic opportunity to consider developing a true joint strategy among our countries to face this complex global scenario." In this sense, the member countries of the bloc have supported Argentina joining the BRICS and have affirmed that Argentina is a world leader in food production; they have also highlighted Argentina's incredible energy potential. 

In this context, Fernandez assured, "at present, the BRICS is the group with the greatest economic and political influence globally. Due to this, we must coordinate policies, keep our industrial and supply chains safe and unobstructed, and work together for inclusive, sustainable development, and resilient economic growth." In this regard, the Argentine Ambassador highlighted the critical role that the bloc was playing in the world economy and said, "It is clear that global macroeconomic stability and economic growth is and will be increasingly dependent on this group of countries."

Sources: Telam

 September 07, 2022

After the beginning of the Export Increase Program for the country's soybean complex, soybean producers negotiated around USD 400 million through the special exchange rate of ARS 200 implemented for the complex's exports. In this sense, official sources of the Argentine government highlighted the performance of the market and stated, "Around one million tons were sold, which represented around USD 400 million. A success, considering the Chicago market did not operate last Monday due to a holiday in the United States." Similarly, the Central Bank of Argentina (BCRA) highlighted the positive effect that the announcement of the program had on the market and remarked, "there was a strong increase in commercial activity, with the participation of all the traditional players and bullish offers that accompanied the announcement of the Program."

Meanwhile, the Secretary of Agriculture, Juan José Bahillo, assured that the measure implemented for the country's soybean complex will benefit the sector and said, "We are seeking to reach an understanding with the sector, and we have given each other a good opportunity for dialogue." He also stated, "we have been working on a work agenda that includes biodiesel, meat, and soybean. Beyond that, we will seek the necessary alternatives for all productive sectors to develop their full potential." 

Sources: Telam, Ámbito

 September 07, 2022

After he met with the heads of the U.S. State Department, Argentina's Minister of Economy, Sergio Massa, stated that the meeting revolved around food security, energy, development with inclusion, and proteins. The meeting was attended by the Deputy Secretary of the Bureau of Western Hemisphere Affairs, Ricardo Zúñiga; the Deputy Secretary of State for Western Hemisphere Affairs, Brian Nichols, and his assistant, Mark Wells; and the U.S. Ambassador to Argentina, Marc Stanley. In this sense, both parties highlighted the importance of developing Argentina's food and energy sector due to the global context derived from the war between Russia and Ukraine. 

In addition, Minister Massa organized a series of meetings at the Argentine Embassy in the United States with different companies with the aim of attracting investments to the country. Additionally, the Minister met with the President of the Inter-American Development Bank (IDB), Mauricio Claver-Carone, to reconstruct bilateral relations with the institution to unblock the agency's halted disbursements to the country.

Source: El Economista

 September 06, 2022

The Secretary of Agriculture, Juan José Bahillo, said on Monday that the application of the Export Increase Program and the incentive of an exchange rate of ARS 200 for exports of the country's soybean complex will boost the sector; In addition, he assured that the program "improves by approximately 40% the income of producers leaving them in better conditions in order to strengthen the campaign of the coarse harvest that is beginning these days." In this sense, Bahillo said "this is a very good decision by our government to improve the income of producers"; and added "for every ton sold, producers are now going to charge around ARS 70,000, when they had been charging about ARS 52,000". In this way, the secretary said that the program will allow the government to increase the international reserves of the Central Bank of the Argentine Republic (BCRA) and indicated that a liquidation of around USD 5,000 million is expected at the end of September; In addition, it indicates that the program will allow the promotion of regional economies and the development of producers.
On the other hand, Bahillo assured that the producers who participate in the program will have benefits and affirmed "that producer who sold 85% of his harvest and the regional economies will be reached by future measures of the fund that are conformed from the liquidation by this improvement in the income to soybean producers." 

Sources: El Economista

 September 06, 2022

The state-owned company Yacimientos Petrolíferos Fiscales (YPF) announced on Monday that it will carry out a set of projects in the country, with the aim of boosting the development and exports of gas and oil from the Vaca Muerta field. In this regard, the president of YPF, Pablo González, said that the Minister of Economy, Sergio Massa, is expected to make progress in terms of investment during his tour of the United States. In this context, the Argentine state announced last week a project with Petronas in the country for the production of Liquefied Natural Gas (LNG) through an investment of USD 10,000 million; According to sources, the project stipulates the construction of a new pipeline system and a liquefaction plant for the export of LNG. 
On the other hand, the state is carrying out the respective negotiations to finance the construction of the second section of the Néstor Kirchner gas pipeline. In detail, the first section of the pipeline will cover about 558 kilometers; while the second section will add another 467 kilometers to the project. Given the international context caused by the war between Russia and Ukraine, different US politicians have highlighted Argentina's ability to supply the international energy market. 

Sources: El Economista

 September 05, 2022

Following the attempted assassination of Argentina's Vice President Cristina Fernández de Kirchner, the government's political agenda outside and inside the country was changed. In this sense, the Minister of Economy, Sergio Massa, arrived on Monday in the United States with the aim of looking for investors and dollars for the country. During his stay in the United States, the minister will hold different meetings, which include meetings with the head of the International Monetary Fund, Kristalina Georgieva; with the head of the Inter-American Development Bank (IDB), Mauricio Claver-Carone, and the head of the World Bank (WB); with U.S. Treasury holders and different officials of the Joe Biden administration; In addition, different meetings with companies from strategic sectors such as the hydrocarbons sector. In this context, it is expected that the goals of the second revision of the agreement between the country and the IMF and different disbursements of the IDB and the World Bank will be consolidated. In addition, according to Argentine government officials, after Massa's tour in the United States, investments are expected to be announced in different sectors of the country such as the automotive sector, hydrocarbons, lithium extraction and logistics development.

The tour to the United States will also be attended by the Deputy Minister of Economy and Secretary of Economic Policy, Gabriel Rubinstein; the Head of Advisors of the Ministry, Leonardo Madcur; the Secretary of Finance, Raúl Rigo; the Secretary of Finance, Eduardo Setti; the Director of the Central Bank, Lisandro Cleri; and the head of INDEC, Marco Lavagna.

Sources: Scope, Telam

 September 05, 2022

The Minister of Economy, Sergio Massa, made official on Sunday the creation of the Export Increase Program, with which the objective of the Argentine government is to accumulate dollars and strengthen the international reserves of the Central Bank of the Argentine Republic (BCRA). The economic measure was announced after being agreed by the main soybean exporting complexes in the country, which establishes a new soybean settlement scheme with an exchange rate of ARS 200 exclusively for the complex; Likewise, the measure will be implemented during the month of September and it is expected that around USD 5,000 million will enter the country in the month. After the announcement, the minister said "this program is voluntary membership, it is not mandatory and starts tomorrow. The objective is to put incentives on the table based on an effort made by the national State and a recognition of the price for the producer in a simple, simple and transparent way"; In addition, he assured "those Argentine producers who adhere to more than 85% of tenure in this program will have the opportunity to continue participating in the benefits program in the coming months." In this context, there is currently a delay in the marketing of soybeans in the domestic market of around 6 million tons.

Sources: Telam, Telam

 September 02, 2022

The Chamber of the Oil Industry (Ciara) and the Cereal Exporters Center (CEC) generated in the first eight months of 2022 a total of USD 25,696 million, which represents a historical record for the income of the oilseed and cereal complex. In this sense, the entities indicated that in August the companies of this sector liquidated a sum of USD 3,387 million, which represented an increase of 5% compared to the month of July and 11% year-on-year. In this context, ciara and cec noted that statistical comparisons between cycles are imprecise and maintained "statistical comparisons between different periods are generally inaccurate since the settlement of currencies is strongly influenced by the grain trade cycle." 
Additionally, Ciara and CEC stated that "business cycles depend on diverse and changing exogenous factors such as international price fluctuations, supply retraction, different volume and protein value of crops; weather conditions, holidays, union strength measures, regulatory modifications, tariff and tariff barriers from abroad, phytosanitary or quality requirements of other countries". It is noteworthy that Argentina's main export product in 2022 is soybean meal, representing 14.2% of total exports; according to data from the National Institute of Statistics and Censuses (INDEC), soybean meal was the second most exported product in the country in 2021.

Source: Telam

 September 02, 2022

The Vice President of Argentina, Cristina Fernández de Kirchner, suffered last night an assassination attempt to which she survived, thanks to the fact that the attacker's weapon failed. Fernández was back at his home, where a group of supporters have been meeting for several days who have expressed their support for the judicial process underway against the vice president, for alleged irregular allocation of tenders for the construction of public works. In this regard, President Alberto Fernández, through a television address, declared a national holiday today, to call for a peaceful march in defense of democracy and in solidarity with Vice President Fernández. 
The national holiday will affect transportation, education, hospitals and the financial system. There will be no banks, the stock market will not operate, and the entire regulated financial sector will be stopped. Likewise, the transactions of the informal exchange market, which supports the free dollar quotes, also stop to move to operate in a similar way to a weekend day: there may be particular transactions, but there will be no clear price reference. Likewise, the Central Bank informs that bank branches throughout the country will not open today for the attention of the public for the national holiday decreed by the government.   

Source: Infobae

 September 01, 2022

The U.S. Ambassador to Argentina, Marc Stanley, highlighted the potential of the Argentine economy due to the current global context derived from the war between Russia and Ukraine. In this regard, Stanley said that "I am pleased to have seen the recent signals from the Argentine government about the importance of the development of dead cow ... it has the potential to attract additional investment from the United States, generate more exports for Argentina, stabilize its economy, and provide allies around the world with many more energy sources that are needed"; In addition, Stanley said that "Argentina has a once-in-a-lifetime opportunity." In this way, the ambassador affirmed that Argentina has the potential to supply the world with energy and food; he also urged the government to seek agreements with the aim of meeting global demand. In addition, he noted the commitment of the United States to continue bilateral relations with Argentina and the desire to promote the economic and social development of the country.
On the other hand, different officials of the US government have shown their concern about the recent political situation that Argentina is going through due to the events of conviction of Vice President Cristina Kirchner; In addition, different officials indicated that these events alienate investors from the country.   

Source: Scope

 September 01, 2022

The Secretary of Industry and Productive Development, José Ignacio de Mendiguren, said that one of the current objectives of the Argentine government is to stabilize the country's economy without affecting the purchasing power of wages. In this regard, De Mendiguren assured that the Minister of Economy, Sergio Massa, is committed to maintaining the levels of economic activity in the country; In addition, I affirm "if you do not grow all the rest is useless". In this context, the secretary warned that one of the great problems of the Argentine economy today is inflation and maintained that "We are clear that the problem of inflation is not fixed with price agreements, but what is being tried through them is to lower expectations"; He also indicated that one of the main factors of the increase in inflation in the country is due to market expectations.
On the other hand, the Secretary of Strategic Affairs, Mercedes Marcó del Pont, assured that there has been no adjustment of the country's fiscal deficit and maintained that "there is no adjustment, but a slowdown in the real growth of spending to converge towards the goals set with the International Monetary Fund (IMF)"; In addition, he remarked that "This has to do with the persistence in the process of strengthening economic growth linked not only to the demand for exports, which this year will reach a new record, but also to the dynamics of the domestic market, consumer and investment demand."

Source: Telam, El Economista

 August 31, 2022

Argentina's Minister of Economy, Sergio Massa, managed to close his first month in office with a debt placement of ARS 212,236 million. On Monday, in the second tender of August, the Secretary of Finance offered a bid for four securities maturing in 2022 and 2023. In this tender, the Treasury issued a Liquidity Bill (LELITE) maturing on September 30th, 2022, with a nominal rate of 56%; in addition, two discount bills (LEDE) maturing on December 16th, 2022, and January 31th, 2023, were placed, with nominal rates of 75.34% and 77.04%, respectively, and an inflation-adjusted bill (CER) maturing on June 16th, 2023, was issued, compensating the inflation rate plus 0.51%. In this context, the Ministry of Finance informed that approximately 1,730 offers were received in the month's bids, representing ARS 450,860 million, and ARS 285,901 million were placed. Of the financing obtained during the month, 68% was represented by fixed-rate instruments, and the remaining 32% by inflation-linked instruments. In detail, in the second tender of the month, the Treasury had to face maturities of almost ARS 90,000 million, so it obtained net financing of ARS 197,000 million. 

Source: Ámbito

 August 31, 2022

On Tuesday, the Secretary of Finance, Raúl Rigo, said that he is already working on developing the 2023 General State Budget (PGE). In this sense, the elaboration of the 2023 budget will have to take into account different factors, such as the Extended Facilities Program with the International Monetary Fund (IMF) and, in the local market, the goal of maintaining the fiscal deficit of 1.9% of the Gross Domestic Product (GDP). According to official government sources, the 2023 PGE is expected to be presented for the first time in mid-September; furthermore, it is stipulated that the PGE will project an overall growth of 3% for the Argentine economy, an accumulation of USD 4 billion in international reserves and a monetary issuance of less than 0.6%. Sources also indicated that the Secretary had based the 2023 PGE on the goals of the agreement in force with the IMF. Meanwhile, the Minister of Economy, Sergio Massa, will make an international tour in September in which he will travel to the United States to obtain dollars; additionally, the Minister will meet in the United States with IMF officials to discuss the status of the agreement. In this regard, the IMF's members have repeatedly stated that the agreement's goals with the country will not be modified.  

Source: Ámbito

 August 30, 2022

The Rosario Stock Exchange (BCR) projects that the exports of Argentina's oilseed and grain complexes will reach USD 40.5 billion by the end of 2022. In this sense, the BCR pointed out that the increase in exports by the complex will be due to increases in the quantities exported rather than the rise in commodity prices. Thus, the entity highlighted the oilseed and cereal complexes as the country's leading exporters and pointed out that the complex had a surplus of USD 19,983 million in the first half of 2022; while the country's agro-industrial sector added USD 3,967 million in that period. In this regard, the BCR highlighted the contribution of the country's oilseed and grain complexes in international reserves and pointed out that without the income from the agricultural sector, the situation of the reserves of the Central Bank of the Republic of Argentina (BCRA) would be complicated. Additionally, the entity stated that "the exporting power of Argentina's agro-industry, combined with the significant increase in international prices, has allowed the government to support the complex dynamics of Argentina's external accounts, limiting the drain of reserves;" furthermore, it assured that the agro-industrial complex had represented a substantial income of dollars for the Argentine economy in the last few years. 

Source: Ámbito

 August 30, 2022

On Monday, the Secretary of Economic Programming, Gabriel Rubinstein, denied the possibility that the Argentine peso would be devalued in the next few days. In this regard, after the announcement, the Secretary assured, "Based on things that are appearing on Twitter, that there will be a devaluation on Thursday because of something that I could have thought of, I assure you 100% that there will be no devaluation, at least not this Thursday." He added, "All one can think of regarding this issue, which you may imagine that I am in favor of a fiscal surplus, zero deficit, and exchange unification, at some point in time ... this government or the next... if you ask me, and I am clearly in that line, but that has nothing to do with making an imminent devaluation." Meanwhile, on Monday, the Minister of Economy, Sergio Massa, announced a new sovereign debt tender in pesos, in which four sovereign bonds were offered, three at a fixed rate and another at a rate tied to the variation of prices. In detail, the bonds will be composed of a discounted liquidity bill maturing on September 30th; a discounted treasury bill maturing on December 16th, and another maturing on January 31st, 2023; a discounted price-adjusted bill (CER) maturing on June 16th, 2023.

Source: El Economista

 August 29, 2022

The president of the Argentine Chamber of Mining Entrepreneurs (CAEM), Franco Mignacco, said that the country's mining exports grew by 33% in the first half of the year compared to the same period in 2021. According to CAEM projections, the mining sector will close 2022 with estimated revenues of USD 3,800 million and with a year-on-year growth of 20%. In this regard, Mignacco said that the Argentine mining industry is waiting for more details regarding the measures proposed by the Ministry of Economy on the scheme that will be implemented to increase the country's exports. In this context, the president of the CAEM said that "In 2022, we are in the order of exports in the first half of USD 1,900 million, 33% more than in the same period of 2021, and we expect to be able to be around USD 3,800 million towards the end of the year"; In addition, he highlighted the importance of the mining sector for the Argentine economy and assured that "the Minister of Economy highlighted the sector as one of the sectors that is providing genuine foreign exchange with a clearly positive trade balance, which after agribusiness is the second sector that contributed more dollars to the country."
On the other hand, Mignacco pointed out that the country's economy has benefited due to the prices of raw materials in the international market and said "we must take advantage of the windows that open and close quickly, with a very volatile international economy. That is why we want to have the predictability of being able to count on all the inputs to be able to take advantage of those moments that also serve the country."

Source: Telam

 August 29, 2022

The Minister of Economy of Argentina, Sergio Massa, will make his first international tour, in which he will have as his first destination the United States. The start of the tour is scheduled for September 6 and its main objective is the search for dollars in a context of scarcity of international reserves. Within the agenda of the trip to the United States are scheduled meetings with different officials of the Biden administration, with the head of the International Monetary Fund and different companies in the private sector. According to official sources reported to Ámbito , different American companies are expected to announce together with Argentine officials a series of investments in the automotive sector, hydrocarbons, lithium extraction and the logistics development of the country. 
In this context, the team that will accompany Minister Massa is made up of the Secretary of Energy, Flavia Royón; the president of YPF, Pablo González; and the head of ENARSA, Agustín Gerez. In this way, Argentine government officials highlighted "The mission aims to consolidate support in the U.S. for the stabilization of the Argentine economy and strengthen reserves through more markets for national exports, more productive investments in strategic sectors such as energy, gas, agribusiness, proteins, knowledge-based services, mining and more foreign exchange income from receptive tourism."

Source: Ambito

 August 26, 2022

Argentina's Secretary of Energy, Flavia Royón, stated that the government is working to promote the oil and gas sector's activities by developing a regulatory framework that supports investments. In this sense, Royón emphasized that the promotion of this sector in the country will substantially impact the generation of employment and the increase of exports and will strengthen the macroeconomic balance. In this regard, the Secretary said, "The energy sector is an activity with a high positive impact on the dynamics of investments, employment, and exports. In particular, the hydrocarbon sector is fundamental for achieving a macroeconomic balance with economic and social benefits due to its strong emphasis on quality employment and developing value chains of small and medium-sized companies. Additionally, he assured the commitment of the Argentine government to promote investments in the country and pointed out that "the government's signals will influence investment decisions and the consolidation of the energy sector. Our role is to strengthen a State that is present to recreate conditions of access and energy availability for the entire population." He added, "We want private capital to come and invest. Therefore, we must know how to generate the conditions of legal certainty and predictability for this to happen."

Source: Telam

 August 26, 2022

According to the Argentine government's projections, the country's exports could reach USD 100 billion by the end of 2022 due to increases in the prices of raw materials in international markets, but mainly because of the rise in the prices of agricultural products. However, the increase in the prices of raw materials will also affect the value of the country's imports, so the country's trade balance surplus at the end of the year is beginning to shrink. In this context, the Ministry of Foreign Affairs stated that the country's exports in the first half of 2022 reached USD 44,377 million, a year-over-year increase of 25.5%. In this sense, exports of manufactured goods of industrial origin (MIO) amounted to USD 11,088 million in that period, with an interannual increase of 6%. Thus, the Secretary of International Economic Relations, Cecilia Todesca, affirmed that the Argentine government's projections are favorable and said, "There is a price effect in agricultural manufacturing, and a quantity effect in industrial manufacturing, which in total is not much, but is significant in the generation of employment and export capacities." Meanwhile, Todesca assured the government's commitment to boosting the country's exports and said, "We have good results when we generate laws that grant benefits in exchange for concrete results."  

Source: Ámbito

 August 25, 2022

The National Institute of Statistics and Censuses (INDEC) announced on Tuesday that Argentine economic activity grew by 6.4% in the first half of 2022 and with respect to May the economic activity of June grew by 1.1%. In June, the Monthly Estimator of Economic Activity (EMAE) was driven by 14 sectors of economic activity, among which the category of hotels and restaurants stood out with an increase of 39.2% year-on-year; mining with 14.2% year-on-year; and transport and communications with 10.8% year-on-year. Additionally, the item of Wholesale, retail and repairs had a year-on-year growth of 8.4%; Manufacturing industry with 6.2%; and Transport and communications with 10.8%. 
On the other hand, the agriculture sector was the only one that registered a fall in year-on-year growth with 4.9%. In this context, the Secretary of Industry, José Ignacio de Mendiguren, highlighted the growth of the country's economic activity and affirmed "the objective is to order the macro variables by maintaining the level of activity, production and employment"; In addition, he added "We are going to seek fiscal balance, maintain and recover the level of activity in a plan that leads to preserving purchasing power, which is the engine of the domestic market."

Source: Telam

 August 25, 2022

The Economic Commission for Latin America and the Caribbean (ECLAC) projected on Wednesday that the Argentine economy will grow by 3.5% in 2022, which places Argentina's growth above the average growth of the countries of the region of 2.7%. In this sense, Argentina's growth projection occurs in a global context of inflation and tightening of financial conditions, as a result of the war between Russia and Ukraine. After the revelation of the projections, ECLAC indicated that the region's growth will be determined by the challenges of boosting investment in Latin America in order to promote a sustainable and inclusive recovery in the different countries. 
In this way, the acting executive secretary of ECLAC, Mario Cimoli, said that "In a context of multiple objectives and growing restrictions, a coordination of macroeconomic policies is required that support the acceleration of growth, investment, the reduction of poverty and inequality, while confronting inflationary dynamics." In addition, the ECLAC report highlighted that the dynamics of rising prices in the region were driven by the increase in raw materials due to the conflict in Ukraine. Thus, inflation in the region continues to rise and stood at a regional average of 8.4% as of June 2022.

Source: Ambito

 August 24, 2022

On Tuesday, the Argentine Prosecutor, Diego Luciani, in charge of the Public Works trial against Vice-President Cristina Kirchner, requested that she be sentenced to 12 years in prison and disqualified from holding public office. According to Luciani, the Vice President was charged with fraudulent administration during her functions in public works between 2003 and 2015. Additionally, the prosecutor requested a 12-year prison sentence for the Argentine businessman, Lázaro Báez, a 10-year prison sentence for the former Minister of Federal Planning, Julio De Vido, the former Secretary of Public Works, José Francisco López, and the former head of the National Directorate of Roads (DNV), Nelson Periotti. Luciani affirmed that the charges were issued for corruption and stated, "Without justice, there is no order or social peace. Today, society demands justice. It is in your hands, judges. An exemplary sentence can be the first step for the institutions to regain confidence." He added, "Honorable judges, this is the moment. Corruption or justice? We are facing a crime of extreme gravity. This is the biggest corruption scheme ever known in the country." Meanwhile, the Minister of Economy, Sergio Massa, described the accusations against the Vice President as absurd and affirmed, "We are facing a dangerous precedent for politics, businessmen, and those who have assistants." 

Sources: El Economista, El Economista

 August 24, 2022

The National Institute of Statistics and Censuses (INDEC) stated that Argentina's trade balance reported a deficit of USD 437 million in July. This deficit was mainly driven by purchases of fuel and lubricants, which totaled around USD 1,368 million in the month, and which implied an increase of 111% in the prices of products and 50% in the quantities of purchases. In detail, exports in July totaled USD 7,732 million, with a year-over-year increase of 7.2%, while imports totaled USD 7,210 million, with a year-over-year increase of 43.7%. Thus, the trade balance showed an accumulated trade surplus of USD 2,540 million in the first seven months of the year. Meanwhile, on Monday, the Governors of the Provinces of Jujuy, Gerardo Morales, Salta, Gustavo Sáenz, and Catamarca, Raúl Jalil, approved a regulation for the operation and administration of the National Lithium Board. After the announcement, the Governor of Jujuy stated that the objective "to strengthen the productive block to stimulate the execution of projects, facilitate investments and safeguard the common interests of the three provinces," while affirming that the regulation "will allow the construction of a legal framework that provides security for investment."

Sources: Telam, Telam

 August 23, 2022

The Argentine government on Monday enacted the Argentine Federal Construction Incentive and Access to Housing Law, which will extend for one year the tax exemption regime for construction in the country. The approval of the law aims to boost the construction sector in the country by implementing tax incentives for those who declare goods. After the announcement of the law, the Minister of Economy, Sergio Massa, stressed the importance of boosting the construction sector in the country and pointed out that "This fiscal relief measure is key to boosting the growth and financing of one of the most thriving industries in the country. When construction works, the activities around it work, jobs are created, the economy moves and Argentina grows."
In addition, Massa said that "The first objective is to transform sleeping savings, which are often not laundered in front of the treasury, into investment and work. We want them to transform those small savings of pesos and dollars that Argentines keep in the face of uncertainty into a good that allows them to preserve value and build a future within their family generations." With this measure, the Argentine government aims to attract between USD 4,000 and USD 5,000 million for construction.

Source: Telam, Cronista

 August 23, 2022

The Ministry of Economy ordered a compensation of budgetary credits with the aim of reducing the country's fiscal deficit and "ordering the public accounts to comply with the current budget." In this regard, ministry officials indicated that the fiscal result for the month of July is "compatible" with the goal of reducing the fiscal deficit to 2.5% according to the Extended Facilities Program between the country and the International Monetary Fund (IMF). In this way, the Minister of Economy of Argentina, Sergio Massa, said that the measure was adopted in order to order the public accounts to be able to comply with the current budget. In the month of July, the National Public Sector registered a primary deficit of ARS 75,947 million, which represents 0.3% of the Gross Domestic Product (GDP). Thus, in the accumulated of the first seven months of the year the country accumulates a primary deficit of ARS 876,628 million, which represents 1.1% of GDP in the course of 2022.
On the other hand, in July the total revenues of the national public sector increased to ARS 1,384,925 million, representing a year-on-year increase of 82.2%. Meanwhile, the primary expenditure of the national public sector reached ARS 1,386,870 million, which represented a year-on-year increase of 62%.

Source: Ambito

 August 22, 2022

Argentina's Minister of Economy, Sergio Massa, confirmed on Sunday the appointment of economist Gabriel Rubinstein as the new Secretary of Economic Programming. After meeting with Rubinstein, Minister Massa said, "Having completed these procedures and formalities, as of tomorrow, Gabriel Rubinstein formally joins the team of the Ministry of Economy as the new Secretary of Economic Programming." In the past, Rubinstein served as a public official between 2002 and 2005 as the Director of the Central Bank of the Republic of Argentina (BCRA) during Roberto Lavagna's administration as the country's Minister of Economy. He also served as the Executive Director of the risk rating agency, DCR-Fitch Rating Agency, and the Buenos Aires Stock Exchange; additionally, in recent years, he was the Director of his consulting firm called Gabriel Rubinstein y Asociados (GRA), which is one of the companies that make up the Market Expectations Survey (REM) of the BCRA. Meanwhile, the Secretary of International Economic Relations, Cecilia Todesca, highlighted the recovery of exports in the food and software sectors. In this sense, Todesca said, "the recovery of exports is remarkable; we will end 2022 at around USD 100,000 million, including goods and services. We are also observing a gradual recovery in the number of exporting companies. Exporting more means having more jobs, with better salaries and, in many cases, producing goods and services that you used to import before."

Source: Telam, Telam

 August 22, 2022

The Argentine Ambassador to China, Sabino Vaca Narvaja, the President of YPF Tecnología, Roberto Salvarezza, and the CEO of the Chinese company Tianqi Lithium, Xia Juncheng, signed an agreement to invest in the exploration, exploitation, production, commercialization, and industrialization of lithium in Argentina. The deal was proposed by the embassy in China under a lithium industrialization policy to promote national industrial development through the generation of employment and the increase of exports of technological goods. After signing the agreement, the Argentine ambassador highlighted China's experience exploiting lithium and said, "China has huge reserves of this mineral. Chinese companies refine more than two-thirds of the lithium in the world and completely manage the technology, which shows that they are the undisputed leaders of the global supply chain." He also added that "China is a strategic partner for the economic development of our country and is a world leader in lithium. Proof of this is that when you look at the main players in the global market, they are all Chinese companies. At the same time, Argentina is a point of the so-called Lithium Triangle, which has more than half of the reserves of this white gold." After announcing the agreement, the President of Argentina, Alberto Fernandez, pointed out that China's support would allow the country to be able to industrialize lithium.

Source: Telam

 August 19, 2022

Argentina's Minister of Economy, Sergio Massa, participated in the weekly meeting of the Community of Latin American and Caribbean States (CELAC) that took place on Thursday in Argentina. After his participation, the Minister pointed out that the country's economic stability depends on the joint work of the members of the economy and affirmed that "macroeconomic stability is a joint work between the State, the rulers, and the economic and social actors of Argentina." In this sense, Massa pointed out that "there will be no social peace without macroeconomic stability; but without social peace, there is no macroeconomic stability" and added that "tensions have been reflected in the decisions to be taken by the State and the private sector when it comes to investing." In this regard, the Minister highlighted the potential of the Argentine economy and said, "Argentina is a great country, with an enormous number of resources, but it is a country that is not rich, but that possesses resources." He also affirmed the Argentine government's commitment to transforming the country's riches into development and growth. On the other hand, the President of the Americas Society, Susan Segal, pointed out in her participation in the CELAC's seminar that the world economy requires significant resources due to the war between Russia and Ukraine. In this regard, she affirmed that Argentina has a considerable number of resources that the country possesses in terms of energy, mining, and food. 

Sources: El Economista, Telam

 August 19, 2022

The President of the Andean Development Corporation (CAF), Sergio Díaz Granados, stated that the entity seeks to double the loan portfolio of USD 3.4 billion for Argentina in the next four years. In this sense, Granados pointed out that the entity has a good relationship with the country and stated that "we are interested in continuing to expand the loan portfolio, doubling it in the next four years, with new projects that have an impact on the citizens." In this regard, the CAF's President highlighted the entity's commitment to work with the public and private sectors of the country, as well as the importance of continuing to develop the region. The Argentine Minister of Public Works, Gabriel Katopodis, affirmed that the Argentine government would maintain the execution of public works in the country and pointed out that "public works generate employment, move the economy, and generate quality of life for the people." Likewise, Katopodis stated that "it is a decision to be made by the President, by the entire government's team, and the Ministry, to sustain and maintain the level of public works, with more than 450,000 jobs and more than 5,000 projects," remarking that "no public works have been stopped, none has experienced payment problems, or certification issues, so we will continue to promote this agenda throughout the country."  

Source: Telam, Telam

 August 18, 2022

Argentina's Minister of Economy, Sergio Massa, indicated that he would meet with the Managing Director of the International Monetary Fund (IMF), Kristalina Georgieva; the President of the World Bank, David Malpass; the Director for the Western Hemisphere of the U.S. National Security Council, Juan González; the head of the Inter-American Development Bank (IDB), Mauricio Claver-Carone; and with the U.S. Treasury Secretary, Janet Yellen, during his trip to the United States. In this context, according to Ámbito, Massa's most important meeting in the U.S. will be with the Managing Director for the Western Hemisphere of the IMF, Ilan Golfdajn, since he will be the one with whom the conversations and negotiations regarding the next steps of the Extended Facilities Program between Argentina and the IMF will take place. On the other hand, on Wednesday, the Argentine government made the appointment of the Secretary of Energy, Flavia Royón, and the Secretary of Agriculture, Livestock and Fisheries, Juan José Bahillo, official. These appointments were announced by the President, Alberto Fernández, and the Minister of Economy, Sergio Massa, after the signing of decrees 494 and 503. In this context, the resignation of Arnaldo Bocco as the Director of the Central Bank of the Argentine Republic (BCRA) was also made official. 

Sources: Ámbito, Ámbito 

 August 18, 2022

After announcing the new tariff schemes for natural gas, electricity, and water services, the Undersecretary of Hydrocarbons of Argentina, Federico Bernal, emphasized that the country's subsidies would be destined for the people who "need them the most." In this sense, Bernal stated that "the segmentation policy implemented by the national government is an unprecedented measure in the history of public utilities in Argentina." He also said that "it will significantly impact the economy." In this regard, the Undersecretary pointed out that the new schemes aim to save and efficiently use natural gas in the country; he also emphasized that the measure would promote a more equal development of public services. On the other hand, Bernal pointed out that the Argentine government took into account the country's "logics of seasonality" and the amount of gas consumed in each of the seasons of the year in the different provinces; he also assured that the segmentation of tariffs would be exclusively for "residential users." Additionally, the Undersecretary stated that "there would be a tariff differentiation process with a consumption cap according to the many tariff zones and categories of users that Argentina has in terms of gas through networks." 

Source: Telam

 August 17, 2022

Argentina's Secretary of Production, José Ignacio de Mendiguren, affirmed that the country's level of economic activity remains strong; he also stated that the government's goal is to maintain the trade surplus and reach USD 90 billion in exports. In this sense, De Mendiguren said, "My responsibility is to maintain the level of activity and reach the goal of USD 90 billion in exports this year, which will be an important record, and this will generate between 12 and 13 billion in trade surplus." In this regard, the Secretary indicated that the trade surplus in 2021 was USD 15 billion; however, he pointed out that the country's trade surplus was not taken care of in that year. In this context, De Mendiguren pointed out that the country's installed capacity is 70%. Additionally, he indicated that the Argentine government's objective is to establish economic stabilization to guarantee the maintenance of the purchasing power of the country's wages. On the other hand, the Secretary of Energy, Flavia Royón, presented the implementation of a tariff segmentation scheme for electricity, gas, and water services, stating that it will be "a distributive policy with a social sense" with the objective of "giving subsidies to those who need them."  

Sources: Telam, Telam

 August 17, 2022

The Chinese company, Shaanxi Coal Group, announced USD 1,250 million in investment in Argentina to open a fertilizer plant in the Province of Tierra de Fuego to supply the country's domestic demand and export the surplus. After the announcement, the Governor of the Province of Tierra de Fuego, Gustavo Melella, highlighted the importance of developing the project for Argentina. Meanwhile, the Chinese Ambassador to Argentina, Zou Xiaoli, affirmed that this project is for the mutual benefit of both countries; he also pointed out China's commitment to continue investments that will deepen the country's cooperation relations with Argentina. In this context, the Argentine Ambassador to China, Sabino Vaca Narvaja, stated that the announcement of the project is clear progress in the relations between both countries and affirmed that the plant would allow Argentina to establish itself as an exporter of fertilizers worldwide. Additionally, together with the construction of the fertilizer plant, a thermal power plant will be built in the Province to supply energy to the plant and the Province itself. According to the company in charge of the project, it will have an annual production capacity of 600,000 tons of synthetic ammonia and 900,000 tons of urea, among other fertilizers and herbicides. 

Sources: Telam, Ámbito

 August 16, 2022

According to official sources of the Argentine government consulted by Ámbito, the Finance Ministry, headed by Sergio Massa, is developing a fiscal plan to prevent a jump in the exchange rate since it could impact the level of food prices in the country, increasing the inflation rate and poverty indexes. In this sense, an official of the Ministry of Economy stated, "Massa has already agreed with all the jurisdictions on the details of how the deviation of 0.7% of the GDP in expenditures will be corrected to comply with the budget goals." In this context, it was announced that economist Gabriel Rubinstein was nominated for the position of Deputy Minister of Economy. After he was appointed Argentina's Minister of Economy, Sergio Massa announced among his measures not to request temporary advances from the Central Bank for the remainder of 2022 to promote the country's fiscal order. Reducing the issuance from the Central Bank to the Treasury would limit increases in the country's monetary base and increases in public spending by the Argentine government. 

Source: Ámbito

 August 16, 2022

  The Congressional Budget Office (OPC) stated that the country's primary deficit was ARS 46,188 million, a drop of 54.9% compared to the same month of 2021. According to the OPC, the decline in the deficit was mainly due to an improvement of 67.5% in the country's current revenues. Additionally, the deficit reduction was influenced by a decrease in energy subsidies in the country and the increase in tariffs for electricity and natural gas services. The results for July showed an improvement compared to the results of the first half of the year, in which the country's expenses increased more than its revenues in each of the months. Likewise, it is expected that the primary deficit in August will be reduced again due to the reduction of fuel imports and the possible decrease in transport subsidies in the country. In this regard, the OPC's report indicated that total revenues in July were ARS 1.12 billion; primary expenditures totaled ARS 1.16 billion, and total expenditures were ARS 1.28 billion. 

Source: Telam

 August 15, 2022

According to surveys, Argentina's inflation rate increased by 3% in the first two weeks of August. In this regard, the food price survey for the second week of August reported a growth of 0.7% and a deceleration of 1.4% compared to the first week of the month. The surveys indicated that the country's inflation rate had accumulated 2.9% up to the second week of the month. In the second week of August, the items with the highest price increases were beverages and infusions for home consumption with 3.8%, condiments and other food products with 3.4%, and sugar, honey, sweets, and cocoa with 3%. Meanwhile, vegetables increased by 2.1%, and dairy products and eggs by 0.7%. On the other hand, meats witnessed a 0.3% decrease in prices. In this regard, Argentine economist, Damián Di Pace, pointed out that "the first week of August does not bring good news for price variations in the food category. In the first week of July, food grew by 2%; now, in August, it is growing by 1.7%. This is not enough to go towards a path of price deceleration in basic categories. Thus, an inflation rate of 6.5% is projected for the ending of the month, which would be among the three highest inflation rates of the year."

Source: Ambito

 August 15, 2022

Argentina's exports reached an all-time record in the first half of 2022 with a total of USD 44,377 million, a 12% increase over the previous record reported in 2011. According to data from the Argentine Foreign Ministry, exports grew by 25.5% in 2021. In 2019, exports increased by 44% due to the increase in international prices of raw materials. Given the global context derived from the war between Russia and Ukraine, the prices of the country's exports are at maximum levels. In the first half of the year, exports were mainly driven by the agricultural sector, especially soybeans and corn. The pharmaceutical and industrial sectors also stood out, with year-over-year increases in exports of 27% and 57%, respectively. On the other hand, in the first half of the year, imports amounted to USD 41,284 million, which was also a historical record for the first half of a year. In this sense, imports were driven by the increase in fuel and fertilizer prices, which accumulated a year-over-year growth of 190% and 32%, respectively.

Source: Ámbito

 August 12, 2022

The National Institute of Statistics and Censuses (INDEC) of Argentina revealed the data of the variation of the Consumer Price Index (CPI) for the month of July. In that month, the country's inflation accelerated and marked 7.4% compared to the previous month, the highest level of inflation in the country since 2002 when the CPI reached 10.4%. According to INDEC, in the accumulated of the last 12 months the country's inflation presented an increase of 71%; In addition, in the first seven months of 2022, cumulative inflation was 46.2%. In this sense, the item that most influenced the increase in inflation was the area of recreation and culture, with 13.2%, due to the increase in prices associated with tourism before the arrival of the winter season in the country. 
Likewise, the item that influenced to a greater extent in the different regions of the country was the category of food and non-alcoholic beverages with 6%. In this context, the Argentine economist, Damián Di Pace, pointed out the influence of different exchange rates on the country's inflation and maintained that "prices in the domestic market begin to position themselves looking at the gap that the official exchange rate has, especially in those inputs that may have problems to replenish inventories. Therefore, it is essential to move towards a tranquility in the exchange market"; In addition, he stressed the importance of strengthening the country's international reserves and the need to generate incentives for Argentina's export sector.

Source: Ambito

 August 12, 2022

The spokeswoman for the presidency of Argentina, Gabriela Cerruti, said that there is a sense of stabilization in the country and maintained that the Argentine government was able to face a currency run. In this regard, Cerruti said in this regard that "Financial dollars fell by 15 percent. We were able to cope with an attempt at a run and speculation that sought a devaluation. There was an attempt at a currency run and we were able to cope with it." In this way, the spokeswoman said that the government "is ordering the expenses and fiscal accounts to give certainty" in the market; In addition, he stressed that in the last week stocks and sovereign bonds rose between 15% and 25%, which reflects the recovery in the value of debt and Argentine companies in the market.
On the other hand, the president of the Industry Commission of the Chamber of Deputies of the Nation, Marcelo Casareto, assured that in the coming days a meeting of the chamber will be convened with the aim of advancing in the approval of the draft Agro Bio Industrial Law of the country. According to Casareto, the objective of the Law is "to reach 200 million tons of production of cereals, oilseeds and legumes in 2030" and increase the country's exports by USD 7,000 million. In this way, the president of the commission pointed out that the Law would allow the generation of around 270,000 jobs in the country. 

Source: Telam, Telam

 August 11, 2022

China's Ambassador to Argentina, Zou Xiaoli, expressed his interest in meeting with Argentina's new Minister of Economy, Sergio Massa, to analyze the bilateral economic relationship between both countries, and execute agreements and contracts. In this regard, the Ambassador pointed out that China's objective in Argentina is to balance the commercial exchange; in addition, he expressed his country's intention to integrate Argentina into the BRICS block of countries. Xiaoli also highlighted that the integration of Argentina into the BRICS will allow the government to "further enrich the comprehensive strategic partnership" that exists between the countries. Regarding Argentina's trade relations with China, the Ambassador indicated that Argentina has a trade deficit with China in the amount of USD 7 billion in 2022; Xiaoli also attributed the imbalance of trade between the countries to "different trade and industrial structures, as well as supply and demand relations." In this context, the Ambassador reiterated that China wishes to collaborate to expand Argentina's export capacity and develop the competitiveness of the country's industries and products. In an interview with Telam, Ambassador Xiaoli stated that "China does not seek to have a surplus in its trade with Argentina, but rather to balance the trade between the two countries sustainably, based on an important level of trade balance;" and affirmed that China is interested in continuing to develop bilateral relations with the country. 

Source: Telam

 August 11, 2022

The President of Argentina, Alberto Fernández, and the Minister of Economy, Sergio Massa, signed the contracts for the construction of the Néstor Kirchner gas pipeline on Wednesday, thus ending the bidding process for the pipeline and starting the works of the first stage of the project. After signing the contracts, Minister Massa assured that next month he expects to carry out the bids for the second section of the project to be able to "sell Argentine gas to the world." He also stated that "this work is financed in part with an extraordinary contribution; there are works that are strategic, that are state policies, that governors of different political tendencies can join to bring development to Argentina." In this context, Massa pointed out the importance of the project for Argentina and indicated that the gas pipeline would transport around 11 million cubic meters of gas per day. On the other hand, Massa expressed the government's commitment to guarantee the heating of the Argentineans during the winter season and said, "between letting out a little more reserves or cutting off the gas and electricity, we decided to guarantee the heating of the Argentineans and to have our machines working." After the signing, President Fernandez pointed out that after the completion of the gas pipeline construction, Argentina could become a worldwide gas supplier.   

Source: Cronista 

 August 10, 2022

Following the appointment of Sergio Massa as Argentina's Minister of Economy, the second review of the Extended Facilities Program with the International Monetary Fund (IMF) is in process. The Argentine government is accelerating the process of establishing contacts with the organization in the meeting to be held at the end of August between Minister Massa and the head of the IMF, Kristalina Georgieva. In this context, in the second quarter of the year, the country met two of the three targets set in the agreement with the IMF regarding the fiscal deficit and monetary assistance by the Central Bank of the Republic of Argentina (BCRA). In contrast, the target for the accumulation of international reserves set in the agreement was left with a debit balance in that quarter. In this regard, Argentine government officials stated that the agreement's goals with the organization have not changed and added that there might be modifications to these goals; they also said, "The program is a living organism." In the next few days, Minister Massa plans to travel to the United States, as a first stop, in a tour that he will carry out through three countries with the objective of "hunting for dollars" to strengthen the country's international reserves. 

Source: Cronista 

 August 10, 2022

The President of the Central Bank of the Republic of Argentina (BCRA), Miguel Pesce, foresees that the country's international reserves will close the month of August with a "partial recovery" and pointed out that the current levels of reserves "are appropriate to face the obligations that the bank will have ahead." Likewise, Pesce said, "We have had reserve levels lower than this, and we were able to face the situation, and the same is going to happen in the coming months." In this context, the President of the BCRA confirmed that the entity was using the currency "swap" with China and stated, "we have a procedure to activate the swap when we see that those Chinese imports or the trade deficit grow. We are on that task right now." In detail, the currency swap with China has a limit of USD 20,000 million. It consists of a financial exchange agreement in which the parties involved receive flows from the other party with the commitment of a particular payment in a certain period. On the other hand, Pesce highlighted that it is projected that there will be a decrease in energy imports of around USD 600 million in August and maintained that "we are still at high energy payment levels in August. We hope this will subside next week, and we expect a reduction in August of USD 600 million, which would improve the country's exchange balance situation." 

Source: Telam

 August 09, 2022

Argentina's "Super Minister," Sergio Massa, announced the appointment of Flavia Royón as the new Secretary of Energy after the resignation of former Secretary, Darío Martínez. After the announcement, Massa stated that Santiago Yanotti would accompany the Secretary as the Undersecretary for Electric Power, Federico Bernal as the Undersecretary for Hydrocarbons, and Cecilia Garibotti as the Undersecretary for Planning. Thus, Massa pointed out that the objective of the new team is to develop Argentina's "energy sovereignty" and ensure "the transformation of Argentina as a power" in the energy sector. According to official sources from the Argentine government, the departure of Martínez as the Secretary of Energy and the appointment of the new officials was "coordinated and agreed upon" by Minister Massa, the Vice President of Argentina, Cristina Fernández de Kirchner, and the President, Alberto Fernández. Secretary Royón is an Industrial Engineer who graduated from the National University of Salta. She has a master's degree from the IAE Business School and a diploma in production and comprehensive mining management, business, and agile methodologies. Previously, Royón served as the Secretary of Mining and Energy of the Province of Salta and chaired its Economic and Social Council. During her work, she promoted the design and articulation of the Provincial Plan for Sustainable Mining Development. She also carried out projects to stimulate investments in exploration in the mining sector and the development of renewable energies.

Source: Telam

 August 09, 2022

On Monday, Argentina's Ministry of Economy reimbursed the Central Bank of the Republic of Argentina (BCRA) ARS 10,000 million to reduce its debt to the entity. Following the announcement of the refund, the Economy Minister, Sergio Massa, said that the Ministry plans to continue canceling its debt with the BCRA. In this sense, Minister Massa assured, "Basically, what we are going to do is not ask for more money from the Central Bank to finance the Treasury. We will be able to manage with the resources that we collect and the financing that we obtain from the private sector." In addition, he affirmed that the measure would allow the government to "eliminate the uncertainty" that exists in the market. The BCRA has transferred around ARS 950,000 million to the country's Treasury for Temporary Advances so far in 2022. However, the Treasury returned ARS 322,449 million to the BCRA as part of the Special Drawing Rights (SDR) granted by the International Monetary Fund (IMF). Regarding the Treasury's debt, the accumulated net financing in the first seven months of 2022 was ARS 1.04 trillion, equivalent to 130% of debt to be refinanced in local currency.

Source: Ámbito

 August 08, 2022

The President of Argentina, Alberto Fernández, participated in the inauguration ceremony of the President of Colombia, Gustavo Petro, and showed his commitment to promoting dialogue between the countries of Latin America. After Petro took office, President Fernández maintained, "The opportunities for brother countries and democratically elected governments to come together allow us to discuss issues of interest and common objectives to strengthen Latin American integration." During his stay in Colombia, President Fernández participated in meetings with the former Presidents of Brazil, Dilma Rousseff, Colombia, Ernesto Samper, and Paraguay, Fernando Lugo. Fernández also met with the President of Bolivia, Luis Arce, and the President of Honduras, Xiomara Castro. On the other hand, the Secretary of Industry and Productive Development of Argentina, José Ignacio Mendiguren, affirmed his commitment to promoting the structural development of Argentina and maintained that "there is only one way to provide a structural solution to the country's problems and that is for Argentina to initiate a period of strong, sustained, and sustainable growth." Additionally, Mendiguren pointed out that Argentina is "on the world's strategic radar" due to the country's natural resources, such as gas and lithium.

Sources: Cronista, Telam 

 August 08, 2022

On Thursday, Argentina's National Institute of Statistics and Censuses (INDEC) will reveal the Consumer Price Index (CPI) data corresponding to July. According to different studies and projections, it is estimated that the inflation rate in Argentina will reach 8% for that month. In this context, the inflation rate for July is expected to be the highest in 2022, surpassing the rate reported in March (6.7%) and accelerating after June's lower inflation rate of 5.3%. In this regard, Argentine economists have attributed the increase in inflation in July to factors such as restrictions on imports, the instability of the different exchange rates in the country, and the seasonal component of the Argentine economy caused by the winter season. In this regard, the Argentine economist, Claudio Caprarulo, argued regarding the increase in inflation in the country, "in the next five months of the year, between August and December, an average monthly inflation level of over 5% is expected since there are no conditions to foresee a reduction in sustained inflation." For its part, the monetary base in July expanded by 8.2% and exerted pressure on the CPI for that month. According to the Central Bank of the Republic of Argentina (BCRA), the monetary base in July grew by ARS 320,850 million and stood at ARS 4.21 billion at the end of the month.

Sources: Ámbito, Cronista

 August 05, 2022

According to studies, in July, the Central Bank of the Republic of Argentina (BCRA) carried out a monetary expansion of around ARS 335,000 million. Thus, this year, the BCRA has issued over ARS 663 billion. However, different sources indicate that the BCRA issued close to ARS 4 trillion in 2022. This issuance has been absorbed by the different placements of securities made by the entity, among these, Passes, Leliq, Notaliq, and other bills, which exceed ARS 6.77 trillion. It should be noted that during 2022, the public sector has been the main factor in the direct or indirect expansion of monetary expansion. In this context, in the first seven months of the year, the Treasury has received around ARS 630,051 million in Temporary Advances (ATN); in other operations, the BCRA has assisted the Treasury with only ARS 170,00 million. In this context, the BCRA sold foreign currency to the Treasury to contract the country's monetary base by more than ARS 51,651 million; in addition, the public sector increased its deposits in the BCRA by around ARS 410,000 million. 

Source: Ámbito

 August 05, 2022

After he was appointed as the Secretary of Production, José Ignacio de Mendiguren assured that Argentina's economic cabinet, led by Sergio Massa, had the main objective to implement economic measures that balance the country's economy. In this sense, Mendiguren stated, "We must be clear about where we stand. At this moment, if you do not achieve a certain balance, you cannot talk about any plan, and when you leave a country very weakened, you destabilize it with a sneeze." In this regard, the Secretary showed his commitment to developing Argentina's productive structure and pointed out that "If there is one thing I am convinced of, it is that there is only one way to solve Argentina's structural problems: by growing and doing so by changing the productive structure because if you grow, you continue exporting." On the other hand, Mendiguren pointed out that Argentina is in an "emergency" with import problems and a significant lack of dollars that affects the country's production. He also remarked that it is not a "structural problem." However, the Secretary highlighted the country's export performance in 2022 and pointed out that "this year, we are going to export USD 90 billion." He added, "Last year, we had favorable figures in the balance, which we most likely did not know how to take care of." 

Source: Telam

 September 21, 2022

The President of Ecuador, Guillermo Lasso, held a series of bilateral meetings within the framework of the 77th General Assembly of the United Nations (UN), which is taking place in New York. This Tuesday, September 20th, 2022, the Ecuadorian President held a meeting with António Guterres, UN Secretary-General.

At the meeting, Ecuador was congratulated for its immigration policy and commitment to the Venezuelan community escaping from the dictatorial government of Nicolás Maduro. "Ecuador is a champion country in the global compact for safe and orderly migration," said the Director General of the International Organization for Migration (IOM), Antonio Vitorino.

Vitorino spoke of the importance of seeking solutions that help host communities, with investments that allow, for example, the creation of jobs for migrants and Ecuadorians. With these statements, the IOM ratified its support to create conditions for the sustainable development of Ecuador. The Minister of Foreign Affairs and Human Mobility, Juan Carlos Holguín, also added that this meeting analyzed integration projects for migrants and refugees in health and education, among others.

Meanwhile, António Guterres discussed the participation of Ecuador as a non-permanent member of the UN Security Council with Lasso. Topics related to environmental conservation policies, the regularization plan, and the program against chronic child malnutrition were also addressed.

Source: Ecuador en vivo

 September 21, 2022

On September 19th, 2022, the Association of Private Banks of Ecuador (Asobanca) highlighted that credit for the productive sector continues to grow. Until August 2022, this segment registered a growth of 33% compared to the same period last year. This financing is intended for micro, small, medium, and large companies. In general, the placement of new credits performed well between January and August 2022. According to figures from the Central Bank of Ecuador, the total of new credits delivered by private banks was USD 20,235 million. 

Meanwhile, of the total loans placed between January and August 2022, 26%, or USD 5,270 million, was allocated to the consumer segment. While 74% of the new credits, or USD 14,965 million, went to the productive segments. The consumer segment experienced an annual increase of 8%. Likewise, Asobanca highlighted that this segment is vital for Ecuadorian households because it allows immediate access to liquidity. They also stressed that during the eight months of 2022, the number of new credit operations granted by private banks was 4.9 million, a growth of 7% compared to the same period in 2021.

Source: El Comercio

 September 20, 2022

According to the National Employment, Unemployment and Underemployment (ENEMDU) Survey, in Ecuador, 182,721 unemployed had been looking for work for at least three months in July 2022. These figures represent 55.3% of the 332,227 people over 15 years of age who were unemployed during that month, according to the survey prepared by the National Institute of Statistics and Censuses (INEC). Likewise, the Institute indicated that 26.9% of the unemployed population had been out of work for between three and eleven months, and 7.9% had even said that they had been looking for a job for a year or more. 
According to the survey, the unemployment rate stood at 3.9% in July 2022, the lowest rate since January 2022. Compared to July 2021, the level of unemployment fell by one percentage point. In contrast, the time it takes a person to find a job did not register significant variations compared to July 2021. In addition, the employment rate is at 32.1%, still far from the levels reported before the COVID-19 pandemic. Before the current crisis, in December 2019, the adequate employment rate exceeded 38%. 
Meanwhile, according to Juan Javier Jarrín, the Director of Business Intelligence Research, people have been looking for a suitable job for several months, without success, where they can earn at least a salary of USD 425 per month. 

Source: Primicias

 September 20, 2022

The reduction of Ecuadorian exports to Russia, due to the latter’s war with Ukraine in the last few months, has positioned Colombia as the fourth leading destination for non-mining, non-oil products from Ecuador, with an increase in sales of plastic and manufactured goods, shrimp, wood, and vegetable oils to that country.
In total, exports from January to July 2022 reached USD 19,590 million: USD 7,202 million for oil, USD 1,621 million for mining, and USD 10,767 million for other products, with 24% of the last going to China, 22% to the United States, 20% to the European Union (EU), and 5% to Colombia.
All these destinations represent more foreign exchange for the country this year. Non-mining non-oil exports to China have doubled compared to 2021, from USD 1,294 million to USD 2,606 million; those to the US have grown by 16%, those to the European Union by 6%, and those to Colombia by 31%.
Until June, Russia was the fourth market with USD 463 million, representing a general drop of 6%, with much more pronounced falls in shrimp, flowers, fishery products, and coffee. In this regard, this ranking is now held by Colombia with USD 542 million, with figures until July provided by the Ecuadorian Federation of Exporters (Fedexpor).

Source: El Universo

 September 19, 2022

According to Ecuador's Ministry of Finance, a preliminary agreement has been reached with the China Development Bank (CDB) to extend for three years, from 2024 to 2027, the maturities of two tranches of the debt with that financial institution. The talks between Ecuador and China are focused on two credits with the CDB, which had long-term oil sales contracts as collateral or guarantee. The first pre-agreement reached was related to the extension of the period within the renegotiation of the debt that the government of Guillermo Lasso undertook as of 2022. 

The preliminary agreement was reached in April 2022, according to a communication sent that month to Petroecuador by the then Deputy Minister of Finance, Andrés Tomaselli. In this regard, in order to advance in the debt negotiation process, Tomaselli requested that Petroecuador renegotiate the two current presales contracts with Petrochina, a subsidiary of the Chinese State's giant, CNPC. 

It should be noted that Ecuador has 18 credit contracts in force with China. In addition, Ecuador's debt balance with China totaled USD 4,128 million up to July 2022, of which 34% of those obligations, or USD 1,406 million, have maturities until 2024.

Source: Primicias

 September 19, 2022

Ecuador's Minister of Economy and Finance, Pablo Arosemena, assured that he was holding talks with the International Monetary Fund (IMF) for more financing for next year.

"We have the capacity to continue working with multilateral agencies; maybe a part could come from the Fund; we are holding talks, and there are other multilateral agencies, such as the IDB (Inter-American Development Bank), the CAF, the FLAR (Latin American Reserve Fund), the World Bank, with whom we work very well and ensure the best financing that allows us to maintain social investment in favorable conditions for all Ecuadorians," said Arosemena, in an interview with the T.V. channel, Ecuavisa.

In December this year, the Extended Facility Agreement that Ecuador maintains with the agency concludes with USD 700 million remaining to be disbursed if the government has met its goals by August 2022.

Arosemena acknowledged that Ecuador's current country risk is high (1,452 points on August 15th, 2022), so issuing sovereign bonds in international markets can mean rates of 16%.

Meanwhile, he indicated that the interest rate on credits with the IMF is approximately 2%, with a four-year grace period. According to the Fund's projections, by 2023, the country needs financing for a total of USD 4,249 million.

Source: Expreso

 September 16, 2022

After four months of talks, Petroecuador closed the renegotiation of the two oil presale contracts signed in 2011 and 2016 with Petrochina, a subsidiary of the State’s oil company, CNPC. The renegotiation involved signing three new contracts between both parties, and three elements emerged from these agreements. 
The first is related to the term of the two presales. Both contracts committed Ecuador to deliver 192 shipments of oil or 69.1 million barrels to Petrochina until 2024. These oil presales contemplated a price formula agreed upon in 2014 during Rafael Correa’s government, which guaranteed prices below the market in favor of Asian companies. With the renegotiation, the delivery period for this volume has been extended until 2027. 
Second, the extension of the term allows Petroecuador to have more oil available for free export. Under a new contract, part of that oil will be sold to Petrochina at market prices and conditions. Finally, Ecuador managed to release 10 million barrels that were committed to China in the 2022-2023 period. Petroecuador will sell the released barrels in the spot or open market, which leaves better prices for the country. 

Source: Primicias

 September 16, 2022

The downward trend that interest rates had been registering in the Ecuadorian financial system since 2021 is beginning to reverse, according to the Central Bank. For example, the active interest rate of productive corporate credit reached 8.45% in September 2022, an increase of 0.88 percentage points in year-over-year terms. In monthly terms, the reference active interest rates of the nine credit segments analyzed, including consumption and microcredit, register increases.
The change in the trend of interest rates responds to less liquidity in the economy, which makes financing more expensive, explained Gonzalo Rueda, the Manager of MarketWatch. Liquidity has decreased because the growth of deposits slowed down in the banking system while the demand for credit increased, said Rueda. Deposits in the private banking system reached USD 41,718 million in August 2022, a growth of 8% compared to the same month of 2021, according to the Association of Private Banks of Ecuador (Asobanca). In 2021 and at the beginning of 2022, the growth rate of deposits was in double digits.
The deposit growth rate slowed down because people saved less due to two factors. The first is the stagnation of adequate employment, which restricts families' income. The second factor is the deterioration of the population's purchasing power due to the increase in inflation, which reached 3.77% in August 2022.

Source: Primicias

 September 15, 2022

Last Tuesday, September 13th, 2022, the State's oil company, Petroecuador, reported that the Manager of International Trade, Pablo Noboa, ceased his duties. The oil company added that "any act or communication issued by Mr. Noboa does not correspond to Petroecuador." Noboa's departure comes at a critical moment since the renegotiation of oil presale contracts with Petrochina, a subsidiary of the Chinese State's oil company, CNPC, is underway. The outgoing official was the head of the negotiating team with Petrochina, a company with which preliminary agreements already existed. 

Meanwhile, a few minutes after Noboa's departure was known, Petroecuador issued a new statement in which it reported that "the renegotiation with Petrochina is progressing normally, according to what was scheduled between the parties." In the second bulletin, the company added that the renegotiation is "focused on generating benefits for the Ecuadorian State, strengthening spot negotiations." 

It is essential to point out that during his administration, Noboa promoted public and open tenders for the sales of Ecuadorian oil. The tenders left better prices for Ecuadorian oil and set a benchmark for the country's renegotiation with Petrochina, which pays lower prices to Ecuador. 

Source: Primicias

 September 15, 2022

The two most significant mining projects in Ecuador, Fruta del Norte and Mirador, will not be included in the moratorium or review of mining concessions that the Ecuadorian government agreed upon with the indigenous movement. This was announced this Wednesday by the Minister of Energy and Mines, Xavier Vera.

"I want to guarantee that these projects that are underway, that are already being worked on, that are working in the mines (...) are not under discussion," Vera said at a press conference on the future of the dialogue tables. He explained that although the request of the social organizations was a moratorium for all the mining projects that were granted after 1998, that "was a disagreement that was not on the table." However, he warned that in the coming weeks, a technical-legal table would be set up to "make the information transparent on how these processes are being carried out" and to analyze "how these processes can be improved in the future," especially in terms of environmental impact.

Meanwhile, the government promised not to grant more mining titles until the Prior Consultation Law is approved, which could take around a year. Currently, Ecuador has Fruta del Norte and Mirador as mines in production and three other projects in the development phase. 

Sources: Bloomberg

 September 14, 2022

The President of Ecuador, Guillermo Lasso, proposes to change the composition of the Legislature so that there are more national assembly members and fewer provincial ones. With the reform, all the provinces would lose between one and two representatives in 2025. The proposal for a constitutional referendum put forward by President Guillermo Lasso opens the possibility of reducing the number of legislators that make up the National Assembly. Currently, there are 137, but the government considers that there is a problem with the issue of representation. The government also questions the current "imperfect proportional" system, as it maintains that it has "created mechanisms of division, which distort and promote polarization." It also criticizes the allocation of provincial seats for generating an "overrepresentation of certain provinces." For this reason, Lasso proposes a total change in the composition of the Assembly.
Currently, the Constitution establishes that the National Assembly is made up, in the first place, of 15 national assembly members. This number does not change with population growth. In the current Assembly, national legislators represent 10.95% of the Plenar,.something that is a problem for the government since they are less than those of provinces such as Guayas (20 assembly members, 17.24%) and Pichincha (16 assembly members, 13.79%). On the other hand, the referendum proposes that the number of National Assembly members be calculated according to the Ecuadorian population determined in the last census. Therefore, it proposes that there should be two assembly members for every million inhabitants.

Source: Primicias

 September 14, 2022

According to Ecuador's Minister of Energy, Xavier Vera Grunauer, the goal of producing 1 million barrels of oil in four years has been delayed and will not be reached in 2025 but in 2026. "The goal will be met, but not in 2025, but the following year, in 2026," assured Vera Grunauer on September 12th, 2022, in an interview with the T.V. channel, Teleamazonas. The government's goal has been considered very "ambitious," and various experts in the oil sector have questioned it as unlikely to be achieved. In fact, the country's oil production remains stagnant at 490,000 barrels per day and has sometimes dropped due to problems such as broken pipelines or the strike of the indigenous movement. 
On the Energy table, which was discussed with the indigenous movements after the strike and a 12-month moratorium on oil fields and mining projects were ordered, although the Minister of Energy indicated that these blocks are not producing. "Oil production in the country will not be affected," he explained. Likewise, last Friday, the government of Ecuador and indigenous leaders signed an agreement to declare a temporary moratorium on the development of 15 oil blocks and suspend new mining contracts until a law on prior community consultations is established. 

Sources: Expreso

 September 13, 2022

The growth of Quito's non-oil exports depends on trade agreements with markets in North and Central America. This fact is supported by a study by the Ecuadorian Federation of Exporters (Fedexpor) presented in September 2022.

Agreements with regional markets could boost Quito's non-oil exports because they would eliminate the high tariffs with which the country's products are taxed. Among these are inputs made from wood, explained Felipe Ribadeneira, the President of Fedexpor. For example, there are products from Quito subject to tariffs of 25% in the US, one of Ecuador's main trading partners. In addition, for two years, some exports lost tariff preferences because the Generalized System of Preferences (GSP), which has not been renewed, ceased to be in force.

The capital's non-oil exports represent USD 2,439 million per year or 13.4% of the country's total.

On the other hand, with new trade agreements, Fedexpor maintains that Quito's non-oil export potential is USD 877 per capita. This means that the total potential for new exports from the capital is USD 1,754 million, considering a population of about two million people. The figure represents an increase of 72% compared to the city's total non-oil exports.

Source: Primicias

 September 13, 2022

President Guillermo Lasso announced the content of the referendum that he wanted to take to the polls. Among the questions chosen by the Executive Branch to be "consulted by its citizens," they all imply reforms to the Constitution. Meanwhile, although the government had anticipated that there would be some popular consultation questions, i.e., public policies, this was not the case. Neither were the dozen questions put forward by the Ministry of Government Affairs. In addition, the Executive Branch preferred that the issues be brought to the polls before the sectional elections to be held on February 5th, 2023. 

In this regard, the final document that reached the Constitutional Court on September 12th, 2022, for review and qualification, consists of the following questions: 1. To allow the complementary support of the Armed Forces to the Police to combat organized crime; 2. To allow the extradition of Ecuadorians who have committed crimes related to transnational organized crime; 3. To guarantee the autonomy of the Prosecutor's Office in the selection, evaluation, and sanction of its officials; 4. To reduce the number of assembly members; 5. To demand that political movements have a minimum number of affiliates, whose registry should be periodically audited; 6. To eliminate the power that the CPCCS has to designate authorities; 7. To incorporate a water protection subsystem; 8. To provide environmental compensation.  

Sources: Primicias

 September 12, 2022

The aggregate public debt, which includes all the obligations of the non-financial public sector, reached USD 74,030 million in June this year, with around USD 46,455 million corresponding to external debt, while USD 27,575 million corresponded to internal debt. When disaggregating the amounts, it may be observed that external indebtedness is the one that increased the most, mainly due to what was lent by multilateral entities, such as the International Monetary Fund (IMF) and the Inter-American Development Bank (IDB), among others. 
For June 2022, the debt with these entities increased to USD 22,310 million, USD 3,486 million more than the same month last year. Since multilateral entities are the main financiers of the country in 2022, one may highlight that the State has received USD 2,200 million from these organizations so far and anticipates that the amount will reach USD 4,500 million until December. 
Meanwhile, the Ministry of Finance explained that Ecuador has a deficit budget, which means that the income is insufficient to cover the country's expenses. Ecuador has had a consecutive fiscal deficit for more than 10 years, with 2008 being the last year a surplus was recorded. 

Source: El Comercio

 September 12, 2022

Petroecuador confirmed that from 00:00 on Monday, September 12th, 2022, the price of Super gasoline will be reduced to USD 4.68 per gallon. Therefore, it will cost 45 cents less than what it was sold for on Sunday, September 11th, when the official announcement was made. However, it should be noted that this will be the suggested reference selling price for gas stations. Likewise, it was also indicated that the cost of Ecoplus 89 gasoline would be USD 3.67.
This is the lowest price that has been set in the last four months and the third that fuel has decreased so far in 2022. Prices are set following international oil values.
Meanwhile, the oil moratorium, signed between the national government and indigenous organizations, will make the goal of doubling crude oil production to one million barrels per day "unattainable." In addition, it will influence investment, job creation, the nation's image, and even country risk.
For Fernando Santos, the former Minister of Energy, this measure will mean that the oil sector enters a period of "freezing" because, as long as there is no Prior Consultation Law, there will be limitations to carrying out new concessions and contracts.

Sources: El Telegrafo, El Comercio

 September 09, 2022

The Central Bank of Ecuador (ECB) stopped issuing letters of credit, for fuel imports from Russia, as of March 10, 2022. He did this to comply with international sanctions that attempt to reduce Russia's liquidity so that it has less funds to finance its invasion of Ukraine. There is no trade restriction with Russia per se, but an impossibility of issuing letters of credit, which is something completely different. The origin of the product is at the risk of the seller according to the INCOTERM.

Restrictions on the export and import of Russian goods exclude products intended for consumption, such as medicines, food and agricultural goods. The full weight of the sanctions, however, falls on exports of fuels and high-tech products from Russia. The steep discounts offered by Russia, plus the upcoming entry into force of sanctions in December, have caused intermediaries to start getting rid of their inventories of Russian fuels.

In June 2022, intermediary Trafigura won a contract for the supply of 2.24 million barrels of diesel to state-owned Petroecuador, divided into six cargoes. Petroecuador announced on August 28 that it had detected that a part of the fourth shipment came from Russia and that the Central Bank had stopped giving letters of credit for those imports.

Source: Primicias

 September 09, 2022

Fedexpor promotes the Quito Exporta program, which aims to support more small companies to internationalize. 39% of companies that export from Quito are small businesses, according to information from the Ecuadorian Federation of Exporters (Fedexpor). They are followed by large companies, with 25%; and medium-sized, with 20%.

For this reason, Fedexpor has promoted the Quito Exporta program, which aims to support more small businesses to internationalize. And the results of the first phase of the initiative were announced on September 7, 2022.

In total, 205 entrepreneurs from Quito have received training on foreign trade processes and international promotion. As a result, 15 MSMEs have already managed to diversify their markets, which has increased their revenues, according to Felipe Ribadeneira, president of Fedexpor. That is the case of Alimentarte. The enterprise, which produces drinks and fruits, has begun exporting to Switzerland, explained María del Pilar Mora, manager of Alimentarte.

On the other hand, Fedexpor announced the second phase of the program, called Quito Exporta 2.0, which will focus on boosting the export of services from the capital. To this end, it will work together with the Ecuadorian Chamber of Innovation and Technology (Citec) and the Secretariat of Productive Development and Competitiveness.

Sources: Firsts, Express

 September 08, 2022

Fedexpor promotes the Quito Exporta program, which aims to support more small companies to go international. In this regard, 39% of companies that export from Quito are small businesses, according to information from the Ecuadorian Federation of Exporters (Fedexpor), followed by large companies, with 25%, and medium-sized ones, with 20%.

For this reason, Fedexpor has promoted the Quito Exporta program, which aims to support more small businesses, and the results of the first phase of the initiative were released on September 7, 2022.

In total, 205 entrepreneurs from Quito have received training on foreign trade processes and international promotion. As a result, 15 MSMEs have already managed to diversify their markets, which has increased their income, according to Felipe Ribadeneira, the President of Fedexpor. That is the case of Alimentarte, an enterprise that produces lupine and fruit drinks, which has begun to export to Switzerland, explained María del Pilar Mora, the Manager of Alimentarte.

Meanwhile, Fedexpor announced the second phase of the program called Quito Exporta 2.0, which will focus on promoting the exports of services from the capital. To do this, it will work with the Ecuadorian Chamber of Innovation and Technology (Citec) and the Secretariat of Productive Development and Competitiveness.

Source: Primicias

 September 08, 2022

Petroecuador's board approved the reports for the renegotiation of commercial contracts with the company, Petrochina, one more step in the process that the government undertook last April. The approved renegotiations include the agreements that have already been reached with China and that have to do with the redistribution of the ten monthly shipments that were delivered to the Chinese company. Thus, the agreement is that four monthly shipments will be sent under practically the same formula, with a slight improvement in price; and, although the delivery period was until 2024, now, by reducing the monthly volume, the delivery period is extended until 2027.

Other shipments, which are part of the extra volume, would have to be delivered under a new contract, but already with a real improvement since it would be handled with a market formula. Finally, the remaining two monthly shipments will be used for spot sales. Meanwhile, after the approval of the signing of the fifth contract modifying contract 2011203, and the second contract modifying contract 2016279 between Petroecuador and Petrochina, and the signing of a new agreement, other important steps must still be fulfilled.

Source: El Universo

 September 07, 2022

The Central Bank of Ecuador (BCE) stopped issuing letters of credit for fuel imports from Russia as of March 10th, 2022. This was done to comply with international sanctions that are trying to reduce Russia's liquidity to that it has fewer funds to finance its invasion of Ukraine. There is no trade restriction with Russia per se, but an impossibility of issuing letters of credit, which is entirely different. The product's origin is at the seller's risk in accordance with INCOTERM.

The restrictions on exporting and importing Russian goods exclude products for consumption, such as medicine, food, and agricultural goods. The total weight of the sanctions falls on exports of fuel and high-tech products from Russia. The deep discounts offered by Russia, plus the next entry into force of the sanctions in December, have made intermediaries start to get rid of their inventories of Russian fuels.

In June 2022, the intermediary Trafigura won a contract to supply 2.24 million barrels of diesel to the state-owned Petroecuador, divided into six shipments. Petroecuador announced, on August 28th, that it had detected that part of the fourth shipment came from Russia and that the Central Bank had stopped giving letters of credit for these imports.

Source: Primicias

 September 07, 2022

According to the National Institute of Statistics and Censuses (INEC), the Consumer Price Index (CPI) rose by 3.77% in August 2022 compared to the same month in 2021. In monthly terms, the CPI rose by 0.03% in August, compared to July 2022. The CPI is one of the main indicators to measure the cost of living or inflation. According to the entity, the cities in which consumer prices increased the most in one year are Manta (4.42%), Quito(3.89%), and Guayaquil (3.82%). 

The rise in prices is due to an increase in nine of the 12 groups of products that make up the basket with which the INEC calculates the CPI. Food and non-alcoholic beverages lead the list with a price increase of 1.27%, followed by transportation (1.10%). Meanwhile, the products that registered the highest price increases between August 2022 and the same month of 2021 were high-octane gasoline (with a rise of 47%), lemons (up by 41%), and pure oil (with an increase of 38%). Likewise, the entity highlighted that the cost of the basic family basket was USD 754.17 during the month of August 2022. 

Source: Primicias

 September 06, 2022

The Ecuadorian government's Chief of Staff, Francisco Jiménez, detailed the Executive Branch's progress regarding the Popular Consultation process. The official spoke of the structure of this proposal and indicated that at least 4 questions will raise security issues; the second aspect will refer to institutionality. Finally, there will be questions related to the economy, for a total of 10 to 12 questions.
"The country needs stability, institutionality. It requires that its authorities complete their periods, which is how the country manages to implement public policies. We have to generate tools, change processes; the role of the Constitutional Court is essential," Jiménez said. Something needs to be done in an environment where 81.86% of Ecuadorians describe the administration of President Guillermo Lasso as "bad" and "very bad," and Vice President Alfredo Borrero's level of disapproval is 75.39% of those surveyed, according to the latest survey by the firm, Perfiles de Opinión.
"Talks are moving forward; the violent acts that paralyzed the country cannot be repeated. We want to solve the problems of Ecuadorians in the process of responsible dialogue and with results. At the tables, we carry out technical studies; we have a methodology," Jiménez asserted. Finally, he repudiated the attack suffered by Assemblyman Fernando Villavicencio and pointed out that these acts of political intimidation should be investigated as soon as possible.

Source: El Telegrafo, Primera Plana

 September 06, 2022

On September 5th, the euro fell to its lowest value for almost 20 years against the dollar, closing at USD 0.99. This revaluation of the dollar is driven by the rise in interest rates by the Federal Reserve (FED) during 2022. In addition, according to the chancellor of Argos Technológico, Jorge Calderón, the Russian invasion of Ukraine is another factor that has affected the euro, as the markets fear that the European Union will enter a recession. In Ecuador, the effects of the revaluation of the dollar against the euro will be observed through trade since the European Union (EU) is the largest buyer of Ecuadorian products. 
Shrimp and bananas are the main non-oil products that Ecuador sells to Europe. Together they accounted for 52% of the USD 1,968 million of non-oil exports to that block in the first half of 2022. However, the EU countries will now need more euros to buy the same products, so the scenario could vary. 
In the case of oil products, oil prices rose again yesterday, which puts European countries in a more complicated scenario. According to several analysts, Ecuador is not developing policies to take advantage of the oil bonanza. 

Source: El Universo, Primicias

 September 05, 2022

The technical commission that the National Executive maintains with the National Assembly received volume II on free zones so that it can be distributed to the legislative caucuses and thereby prepare the inputs and observations on this subject, within the framework of delivering the new proposal for the Investment Law, which the Executive Branch determined will now be in parts, converting each chapter into a different norm. In an 18-page document, the Executive Branch covers topics such as the treatment of investments and investors; replacing 'Special Economic Development Zones,' 'Special Zones' with: 'Other customs destinations: Free Zones (ZF) and Special Economic Development Zones (ZEDE).'

Regarding these zones, the Executive Branch seeks to determine that ZEDEs be recognized as customs destinations within a delimited space of the national territory so that new investments may be established with the incentives detailed in these regulations; those that will be conditioned to the fulfillment of the specific objectives.
In the case of FZs, it is determined that they be recognized as a customs destination within a delimited space of the national territory, in which new investments may be established, as defined in the Code. These investments may be made by legal entities, private, public, or mixed, national or foreign, that are constituted from the validity of the Organic Law for the Attraction of Investments, Strengthening of the Stock Market, and Digital Transformation.

Source: El Universo

 September 05, 2022

Between January and July of this year, Ecuador had more than USD 12.7 billion in revenues, based mainly on tax collection and high oil prices. However, according to data from the Ministry of Economy and Finance, the level of government expenditure has not maintained a steady pace. In fact, the country’s level of budget execution does not exceed 50%. Meanwhile, the Citizenship and Development Foundation analyzed the budget execution level registered in the first semester of 2022. According to the document, in the three functions of the State, there is an execution of 49%. 

According to this analysis, the Ministries of Urban Development and Housing, the Ministry of Energy and Non-Renewable Natural Resources, and the Secretary of Management and Development of Peoples and Nationalities register less than 10% in budget execution. Likewise, according to the Ecuadorian analyst, David Castellanos, the low level of execution has a direct impact on employment. According to figures from the National Institute of Statistics and Censuses (INEC), the adequate employment rate reached 32.2% last July, which means that only three out of 10 Ecuadorians are fully employed. In addition, the entity highlighted that the Ministry of Transportation and Public Works, which is usually a determining generator of employment in the country, registered an execution of 27% between January and June 2022. 

Source: El Comercio

 September 02, 2022

Ecuador's state-owned oil company, Petroecuador, will export 2.16 million barrels of Oriente oil to the Chilean state-owned company, ENAP, which won the sixth spot sale for the open tender of Oriente oil after submitting the best offer. In detail, the Chilean oil company offered USD 2.14 per barrel below the WTI price, the reference for Ecuador. According to Petroecuador, the sale of 2.16 million barrels of Oriente oil will generate US$ 187.1 million in income for the state. ENAP also beat the other two proposals received by Petroecuador: the Dutch multinational Trafigura, which offered USD 9.45 per barrel below the price of the WTI reference oil, and Petrochina, which offered USD 3.25 per barrel below the price of the WTI price. According to Petroecuador, the lot of Oriente oil will be shipped in six cargoes of 360,000 barrels. Petroecuador's International Trade Management reported that 49 qualified companies were invited to the tender and notified that with this sales volume, 13% of the target set at 16% of spot sales for this year would be reached. "This figure exceeds the minimum 10% established in the norm, in compliance with the strategic objectives of revaluing Ecuadorian crude and strengthening the spot segment," said the company. Meanwhile, this is the ninth crude oil export process and the sixth for Oriente crude oil this year.

Source: Primicias, Bloomberg Linea

 September 02, 2022

Among the main concerns of Ecuadorians in 2022 is the labor market situation, along with the lack of security. This is due to the fact that the adequate employment rate is at 32.1%, far from the levels reported before the COVID-19 pandemic, according to the National Institute of Statistics and Censuses (INEC). The data shows that before the current crisis, in December 2019, the adequate employment rate exceeded 38%, which meant that almost four out of ten people of working age were fully or adequately employed, where they received a basic salary of USD 425 a month, and they worked 40 hours a week. 
According to the Internal Revenue Service (SRI), the stagnation of adequate employment occurs despite the growth recorded in sales and exports. A study by the Development Studies Corporation (CORDES) reported that among the most important factors that may explain the deterioration of labor indicators are: wage increases, social protests, and political uncertainty. It also stated that the political crisis and social unrest had weakened the government, hindering its ability to approve new reforms that promote investment and employment. 

Source: Primicias

 September 01, 2022

The Ministry of Economy and Finance (MEF) explained that the ecuadorian State's ability to honor its obligations to international creditors and suppliers in the face of the actions that the Perenco company undertakes in some jurisdictions has not been affected. He also clarified that the ministry has not received any official notification from the competent court regarding these actions. In addition, he indicated Ecuador's commitment to respect the arbitral award in the Perenco case. However, such compliance shall be done in the interests of the Ecuadorian State. According to the government, Perenco has debts to the Internal Revenue Service (SRI) and this has made it difficult to pay the award. In this sense, it is expected to reach an agreement with Perenco, which no longer operates in the country. The agreement would seek to establish a payment mechanism until a legal definition on tax obligations is reached. This aspect is being processed in judicial instances in the United States. According to the government statement, the Ecuadorian state is acting responsibly to ensure the recovery of what is owed to it for taxes. "At no time has there been the country's intention not to comply with this award, which is the result of decisions adopted by the government of Rafael Correa," the statement reads.

Sources: El Comercio

 September 01, 2022

According to data from the Ecuadorian Federation of Exporters (FEDEXPOR), Ecuador has imported a greater amount of potassium fertilizers during the first half of 2022. They also pointed out that the country allocated USD 64 million for the acquisition of 84,137 tons of agrochemicals with a potassium content ranging from 58% to 63%. This is a response to the increase in the price of urea, which generally came from Russia and Ukraine. In other words, potassium is an essential nutrient for crop growth and is becoming the alternative to urea.   
Imports of potassium fertilizers compared to the period January-June 2021 have risen 76% in volume and 22% in value. This increase is given, according to FEDEXPOR, by a greater purchase of agrochemicals with potassium from Chile and the United States. In this way, during the first half of 2022, Ecuador has imported from Chile 34,262 tons of agrochemicals with potassium, which means an increase of 1,042% compared to the same period last year. On the other hand, the import of fertilizers from the United States was 11,044 tons, which represents an increase of 207% compared to the first half of 2021.

Source: Primicias

 August 31, 2022

The Special Rapporteur of the United Nations-UNO for Indigenous Peoples and Nationalities, Francisco Calí Tzay, will collaborate with the dialogue table on Justice and Collective Rights, between the government of Ecuador and indigenous sectors, according to the Ministry of Government Affairs. Likewise, the Ministry pointed out that the rapporteur will know the methodology with which the dialogues are developed and will hold meetings with representatives of the Executive Branch and indigenous organizations. "It is an example to the world of the seriousness with which the government of President Guillermo Lasso assumes the dialogue tables, seeking to improve the quality of life of the sectors forgotten by previous governments," said the acting Chief of Staff, Homero Castanier. The participation of the UN representative was one of the requests of the indigenous groups. Regarding the Productive Development Table and the regime's expectations, Castanier pointed out that the proposals are not accepted as they are put forward, but obtain a response. "We are talking about a structural issue of the agricultural sector in rural Ecuador; we are talking about how to improve efficiency, profitability, fair prices, commercialization, and level of technology, and thus contribute to a better quality of life," said Castanier. Regarding the targeting of fuel prices, the Minister pointed out that it is a more complicated goal since technical information is needed to reach practical agreements. He also explained that the indigenous leaders requested to focus fuel subsidies for community transportation, small farmers, peasants, and artisanal fishers.  

Source: Swissinfo

 August 31, 2022

The preparation of the General State Budget for 2023 will begin in September, and the Ministry of Finance already has a few starting points. One of them is the price of oil, one of the primary sources of income for the State's budget. According to the International Monetary Fund (IMF), the price of Ecuadorian oil will average USD 75.3 per barrel in 2023. With that price, the budget's oil revenues would fall by around USD 500 million compared to 2022, warned the former Minister of Finance, Fausto Ortiz. The former minister explained that Ecuadorian oil averaged USD 93 per barrel between January and June 2022, which implies 36% more than the projection of USD 59.2 per barrel of oil used to prepare the State Budget at the beginning of 2022. The government's goal is to close with a deficit of USD 700 million or 0.6% of GDP in its fiscal accounts in 2023. In this regard, the Ministry of Finance seeks to cut the deficit to ensure that multilateral organizations continue to provide credits to the country with low interest rates. Likewise, it is highlighted that the Ministry of Finance faces various challenges in order to prepare the 2023 budget, among them: less oil revenues, less income through two taxes, little room for cuts, and new sources of financing.  

Source: Primicias

 August 30, 2022

The Ecuadorian State’s oil company, Petroecuador, informed that it had requested that the Dutch company, Trafigura, refrain from importing diesel of Russian origin into the country to comply with the sanctions imposed by the United States and Europe for the military intervention in Ukraine. Trafigura won a public tender last June 16th, allowing the company to import diesel into Ecuador. However, last August 27th, in the provisional documentation received regarding the unloading of the fourth shipment, Petroecuador found that out of 275,146 barrels of diesel oil, 95% originated in a Russian port and the remaining 5% in Panama. In this sense, the Ecuadorian oil company requested that Trafigura refrain from importing fuels of Russian origin since it could incur penalties due to the sanctions imposed internationally after the war with Ukraine and to avoid actions that could have repercussions on Ecuador and its officials. Petroecuador recalled that the Central Bank of Ecuador had announced that it would not issue letters of credit due to the restrictions applied to importing fuels of Russian origin. Therefore, Petroecuador had included a clause on sanctions in the bidding conditions. Although Ecuador is an oil exporter, it has a deficit in producing petroleum products; therefore, it must import gasoline and naphtha to supply the domestic market. Meanwhile, the Dutch company, Trafigura, is trying to sell the oil it has from Russia and is looking to Latin America to sell Russian diesel.

Sources: La República, El Universo

 August 30, 2022

Last Monday, August 29th, 2022, Ecuador's Minister of Production, Foreign Trade, Investments, and Fisheries, Julio José Prado, requested at a meeting of the Andean Community (CAN) that the group evaluate "some issues" to respond to the "new vision of the international trading system, the post-pandemic crisis, and the current situation." In this regard, he expressed that "I would like to reflect on the need to evaluate some related issues to respond to the new vision of the international trade system, the post-pandemic crisis, and the current international situation that brings us challenges in logistics issues, the irruption of value chains, and food security." At the beginning of the LI meeting of the Andean Council of Foreign Ministers, before the XXII Meeting of the Andean Presidential Council, the Ecuadorian Minister took stock of the "pro tempore Presidency" that his country headed, which concludes today. Likewise, he wished "the greatest success" to Peru. For his part, the Ecuadorian Foreign Minister, Juan Carlos Holguín, stressed that throughout the year his country has held the temporary presidency, his work "had post-pandemic economic and social reactivation as a priority." 

Source: Swissinfo

 August 29, 2022

In an interview, the Minister of Production, Foreign Trade, Investment and Fisheries, Julio José Prado, stated that the government's expectations are to conclude by 2025 with at least 10 trade agreements. He is currently working on four negotiations: Mexico, South Korea, China and Costa Rica. The four countries are expected to close the treaties between the end of this year and the first quarter of 2023. According to Prado, the treaty has 99% progress, but the remaining 1% corresponds to the entry of Ecuadorian bananas and shrimp products into Mexico. For Prado, the products are "a red line" since Ecuador could not close a trade agreement without guaranteeing the entry of these two products, even if it is under a quota scheme. Regarding South Korea, "it is flowing very well," Prado said while pointing out that there are no products in which there is a dispute. He reported that there will be more rounds of negotiations in Ecuador between the last week of September and the first week of October. A broad-spectrum agreement is being worked on with Costa Rica and there is a willingness on both sides to move quickly. On China, work has already been done and progress has been made both politically and commercially. This agreement will not be wide-ranging and will only have five working groups. Ecuador expects that after the agreement with Mexico, the country will join the Pacific Alliance and it is projected for next year to begin negotiations with Panama, the Dominican Republic and Canada. In addition, there are possibilities of a trade agreement with the Trans-Pacific Partnership, turkey and Israel.

Sources: Bloomberg Linea

 August 29, 2022

The President of Ecuador, Guillermo Lasso, is in Lima, Peru to participate in the ceremony of handing over the pro tempore presidency of the Andean Community (CAN) to the President of Peru, Pedro Castillo. Lasso was received at Air Group 8 by Peruvian Foreign Minister Miguel Ángel Rodríguez and immediately went to a working meeting prior to the XXII Andean Presidential Council, to be held at the CAN headquarters in Lima. The event will also be attended by the President of Bolivia, Luis Arce, the President of Colombia, Gustavo Petro, as well as Lasso and Castillo. Also, the secretary general of the Community, Jorge Pedraza.  
Before the departure from Ecuador, President Lasso would have confirmed that the first week of September he will send to the Constitutional Court, the questions of the popular consultation. The president also stressed that during the meeting with his colleagues from Bolivia, Colombia and Peru, Lasso will offer a report on the achievements made in the exercise of the pro tempore presidency in the last year. He also highlighted the fight against Fusarium 4, which affected banana plantations. In addition, having a free roaming in the Andean region, highlighting this as the main advances in South American integration in the block. 

Source: Primicias

 August 26, 2022

The President of the Spanish government, Pedro Sanchez, ratified the commitment of Spanish companies in Ecuador and said he is committed to increasing investments, thanks to the trust in the country. "One invests in a place one trusts," Sanchez specified while mentioning the legal security framework that Ecuador has created to allow foreign investments. Likewise, the leader of the Spanish government defended the increase in investments in his speech at the business forum organized in Quito on the occasion of his official visit. Before representatives of some 300 companies from both countries, Sanchez cited some data regarding trade relations. In detail, Spain was the ninth supplier and the seventh client of Ecuador in 2021, and the second among the countries of the European Union. He highlighted that Spanish exports to Ecuador were worth EUR 497 million, and Ecuadorian exports to Spain were EUR 637 million. Mr. Sánchez underscored the commitment to the one hundred Spanish companies in Ecuador, which provide around 20,000 direct jobs there. He pointed out that Spain and Ecuador are united by excellent ties, such as those he said also link his country with all of Latin America. Also, Spain's Minister of Industry, Trade, and Tourism, Reyes Maroto, valued the commercial relations with Ecuador and mentioned that they still have great potential in many areas. 

Source: Expreso

 August 26, 2022

On August 24th, 2022, the Ministry of Energy and Mines reported that Ecuador reached a new record in monthly exports of mining products. Additionally, it is estimated that more than USD 2,600 million will be obtained until December. For its part, the Ecuadorian Episcopal Conference (CEE) has been held with the participation of the energy and natural resources table between indigenous organizations and the Executive Branch. These talks have been led by the Ministry of Energy, where the State’s Portfolio highlighted the figures reached for mining exports in a bulletin. The Ministry of Energy expects exports of mining products to reach USD 2,673 million by the end of 2022. It also highlighted that during the first half of 2022, 54.50% of the proposed goal had already been met. In addition, in June 2022, according to the Ministry, Ecuador exported USD 356 million in mining products, a figure that exceeds the record achieved in April by 20%. In that month, USD 295.32 million was sold. Likewise, the Ministry of Energy, based on data from the Central Bank of Ecuador (BCE), indicated that during the first half of 2022, USD 1,457 million in mining products was exported, which represents 58.61% more than what was exported in the same period of 2021. 

Source: El Comercio

 August 25, 2022

Next Monday, President Guillermo Lasso plans to hand over the annual presidency of the Andean Community to his Peruvian counterpart, Pedro Castillo, during the presidential summit to be held in Lima between the four countries that make up this organization, informed the Ecuadorian Ministry of Foreign Affairs. In this sense, Ecuador, which led the group integrated by Peru, Colombia, and Bolivia during the last year, will pass the rotating presidency to the Peruvian government during the twenty-second Andean Presidential Council. At the Council, Ecuador will present a balance of the integration process in the region, the Foreign Ministry said. The Presidents of Bolivia, Luis Arce, Colombia, Gustavo Petro (who will attend for the first time), Ecuador, Guillermo Lasso, and Peru, Pedro Castillo, are expected to participate. Lasso received the temporary presidency of the Community on July 17th, 2021, less than three months after taking office (May 24th of that year) from the then Colombian President, Iván Duque. The Andean Community is an integration mechanism created in 1969 whose main objective is to improve the quality of life of the 111 million citizens living in the region. 

Source: La República

 August 25, 2022

According to the National Survey of Employment, Unemployment, and Underemployment (ENEMDU), the national strike of June 2022 had an impact on workers' income. According to the survey, during July, workers said that their average income was USD 286, which means a reduction of 9% in year-over-year terms. The average labor income fell because people lost hours of work due to the blockade of the roads, which prevented them from moving around. When viewed in macro terms, the protests staged in June cost the country close to $1 billion, according to the Central Bank. In addition to the protests, the country's risk began to increase substantially and currently exceeds 1,500 points, also supported by the downward trend of the price of the West Texas Intermediate (WTI) oil barrel, one of the primary sources of income of the Ecuadorian economy, which in recent weeks has fallen below USD 100 per barrel. The current figure is the highest since September 2020, when it was above 2,800 points in the days before the signing of the USD 6.5 billion credit program with the International Monetary Fund (IMF).

Sources: El Comercio, Primicias

 August 24, 2022

According to the Economic Commission for Latin America and the Caribbean (ECLAC), the war in Ukraine, intense inflationary pressures, low dynamism in job creation, falls in investment, and growing social demands will make Latin America's economy grow by only 2.7% this year. Likewise, the ECLAC forecasts a growth of 2.7% in the Ecuadorian economy for 2022. However, before the indigenous protests in June, the World Bank had projected Ecuador's GDP growth to remain at 4.3%. Furthermore, the ECLAC warned that the context for the region is very complex. Mario Cimoli, the Acting Executive Secretary of the UN agency, noted that "16 of the 33 countries in the region have not recovered their pre-pandemic GDP levels." Within ECLAC's projections, the economies that will expand the most this year are Venezuela (10%), Panama (7%), Colombia (6.5%), the Dominican Republic (5.3%), Uruguay (4.5%), Guatemala (4%), Honduras (3.8%), Bolivia (3.5%), and Argentina (3.5%). Meanwhile, according to the business climate index of the Brazilian Economic Research Center of the Getulio Vargas Foundation (FGV), Ecuador's economy declined for the fourth consecutive quarter and was at its lowest level in the third quarter of 2022 in the last 15 months. In detail, Ecuador's so-called Economic Climate Index (ECI) went from 72.1 points in the second quarter of 2022 to 70.5 points in the third quarter. 

Sources: La República, Primicias

 August 24, 2022

According to the latest survey by the National Institute of Statistics and Censuses (INEC), Ecuador’s employment, underemployment, and unemployment indicators improved in July 2022 compared to the same period in 2021. One of the positive and statistically significant indicators was that of unemployment. In Ecuador, there are currently 332,227 unemployed people, which represents 3.9% of the economically active population. However, a year ago, the figure was 426,884, which implies that there are 94,457 fewer unemployed individuals in Ecuador. During the month of July, unemployment in Ecuador had a statistically significant reduction, going from 5.2% in July 2021 to 3.9% in July 2022. Meanwhile, full employment recovered from 31.8% to 32.1% in the same period. In July 2021, 2,631,708 workers were fully employed. However, in July 2022, the number was 2,752,904. The disparity may also be found in the Ecuadorian territory since, for the urban area, full employment was 41.1%, while in the rural area, it reached 14.5%. In addition, according to what was pointed out by the entity, men presented a higher proportion of adequate employment compared to women. The adequate employment rate for men was 36.9%, while it was 25.6% for women.  

Sources: El Universo, Bloomberg en Linea

 August 23, 2022

The President of Ecuador, Guillermo Lasso, accepted the invitation to dialogue with delegates from all factions of the National Assembly. Likewise, the Ministry of Government Affairs announced that it had appointed three officials to form a mixed commission between representatives of the Executive and Legislative Branches to give way to the rapprochements. This commission is made up of Sariga Moya, the Ministry's General Coordinator of Planning and Strategic Coordination, who will lead the team; in addition to Ricardo Avilés, an advisor to the Ministry, and María José Piñeiros, the Director of Political Articulation with the Legislative Function. President Guillermo Lasso has faced an adverse scenario, and in the dispute that has lasted for months between the Executive Branch and the Legislative Branch, he seems to be at a disadvantage, which is why the President has issued the warning that he will bypass the Parliament to legislate through popular consultation. The government has not yet confirmed the questions for a possible consultation. However, it has stressed that the priority will be security and that it will not rule out including pending legal reforms. Meanwhile, the President of the National Assembly, Virgilio Saquicela, came forward and asked Lasso to sit down and discuss "specific issues: investment law, labor law, and total vetoes."

Source: Primicias

 August 23, 2022

In the first semester of this year, Ecuador's oil exports totaled USD 6,236 million, banana exports totaled USD 1,700 million, and mining exports USD 1,400 million. Regarding the last sector, only in lead and copper concentrate, the increase is 103% with USD 766 million so far in 2022 compared to the same period last year, while between 2020 and 2021, the growth was 200% in revenues going from USD 306 million to USD 921 million, according to the Ministry of Production. The development of the mining sector is in line with the forecasts of the Ministry of Energy and Mines, where this sector would not only surpass bananas but would fight for first place in exports with oil in about eight years. With the export data registered up to the first semester, mining products are expected to surpass bananas in 2022. In 2021, foreign exchange from mining reached USD 2.09 billion, and the USD 1.4 billion exported so far could double by the end of the year. Meanwhile, so far this year, banana exports have been hampered by the Russian-Ukrainian conflict, the rise in fertilizer prices, the national strike, and the weather in Europe. From January to June, 180 million boxes were exported, 8% less than in the same period of 2021, also reflecting lower revenues (6% less compared to 2021).

Source: El Universo

 August 22, 2022

According to projections by the U.S. investment bank, Morgan Stanley, food prices, which grew to 65% worldwide between 2020 and 2021, will peak in 2022. Along the same lines, the Food and Agriculture Organization’s (FAO) index, which measures the international prices of five essential products: cereals, oils, dairy products, meats, and sugar, also shows this. The indicator averaged 149 points in the first half of 2022, the highest level in three years, representing a severe risk to the world’s economic recovery. For the institution, the consequences of high prices will be worse in emerging and developing markets, where food represents a large part of total consumer spending, and Ecuador is among these countries. In this regard, Ecuador is in the group of countries that register relatively high inflation levels, between 5% and 30%, since, in July this year, its food prices rose by 7.7% in year-over-year terms. Ecuadorians have been affected by increases in the prices of carrots (40%), butter (31%), and vegetable oil (30%) in the last year. Some governments have established price controls and trade restrictions to contain their inflation rates. One of the consequences of these increases is that families cut spending in other areas as they have to spend more money on food products.  

Source: Primicias

 August 22, 2022

The risk rating agencies, S&P Global Ratings and Fitch Ratings, announced that they would maintain Ecuador's sovereign credit ratings, despite political and social tensions after the protests staged in June 2022. The US company, S&P Global Ratings, recognizes that Ecuador has faced a "complex" situation with the challenge of reducing spending on fuel subsidies. Likewise, it highlighted that the Central Government has been holding talks since July 2022 with the Confederation of Indigenous Nationalities (CONAIE) to reach an agreement on the fuel subsidy. A higher gasoline subsidy will undermine Ecuador's ability to reduce expenses and affect the balance of its accounts; the rating agency said on August 17th, 2022. However, the US firm maintained Ecuador's sovereign rating at B- for long-term obligations and B for short-term obligations with a stable outlook. For its part, the rating agency, Fitch Ratings, also announced on August 19th that it maintains Ecuador's long-term rating at B- with a stable outlook. Likewise, S&P Global Ratings stated that it maintained the rating because it does trust that the Lasso government will continue to implement policies to reduce economic imbalances. 

Source: Primicias

 August 19, 2022

According to the Patrimonial Declaration presented to the Comptroller's Office, Hugo Aguiar Lozano is the new manager of the state oil company Petroecuador since August 18, 2022. However, Petroecuador has not made official the appointment of Aguiar, who has worked for 12 years in the public administration, of which four months were in the state oil sector. In this sense, Aguiar would be the fourth manager of the company in the 15 months that the Government of Guillermo Lasso has been in office. In detail, Aguiar is a lawyer from the Pontificia Universidad Católica de Ecuador (PUCE) and has a master's degree in Law from Harvard University. According to information from the Comptroller's Office, Aguiar worked between 2011 and 2022 in the public sector, of which, from May 6 to August 17, 2022, he served in the state oil sector, as Deputy Minister of Hydrocarbons. When he was appointed deputy minister, with the help of the Minister of Energy, Xavier Vera, he was one of the Government delegates to participate in the dialogue tables on the targeting of the fuel subsidy. In addition, between June 2021 and May 2022, he served as an advisor in the Presidency of the Republic. In the particular field, Aguiar was a consultant for the World Bank between 2017 and 2020, in matters such as public administration and state reform. Two challenges of the new manager of Petroecuador are to boost the increase in oil production and close the renegotiation of pre-sales with Petrochina.    

Sources: Firstfruits, The Universe

 August 19, 2022

According to the Ministry of Economy and Finance (MEF), work is being done to implement in 2023 a proforma called zero-based; that is, in general terms, to propose the figures of expenses without considering those of last year. According to Minister Arosemena, "for next year's proforma we are choosing, selecting, certain entities of the public sector. For the first time in Ecuador's history, we are making a zero-based budget."  
The minister stressed that when a budget is prepared, the budget of the previous year and what has been spent on it is taken as a reference to propose a number for next year. Now, it will seek to set figures without considering previous years to correct possible unnecessary expenses, in order to optimize resources. In addition, he pointed out that "we have had to get people from outside. Not everyone understands the concept, the execution of that idea. There are no experts here to be able to run the zero-based budget."  
However, according to former Finance Minister Fausto Ortiz, drawing up a zero-based budget has its limitations. For example, values such as transfers to municipalities and prefectures or debt payments, among others, are rigid amounts that the Government must establish year by year.     

Source: Expreso

 August 18, 2022

Ecuador's Minister of Economy and Finance, Pablo Arosemena, stated that the country could return to the international market to issue bonds in 2023. According to the IMF, Ecuador will need to borrow around USD 6 billion in 2023 to pay obligations from previous years and cover the fiscal deficit. However, other analysts estimate that the amount could escalate to USD 8 billion, considering the Ecuadorian State's arrears with the Social Security Institute (IESS) and that the economic program agreed upon with the International Monetary Fund (IMF) will be completed by December 2022. Although the IMF forecasts that Ecuador will need USD 1,500 in external bonds, Arosemena did not specify the volume of placements and pointed out that it would depend on market conditions. Due to the mobilizations of June 2022, investors perceive Ecuador as a riskier country. The country risk stood at 1,440 points on August 16th, which means that if the government decides to issue bonds today, it would have to pay 16% interest to investors, a higher rate than the one charged by multilateral agencies, around 2% on average. According to the IMF, Ecuador can use a USD 400 million guarantee from the Inter-American Development Bank (IDB) so that investors perceive a lower risk and charge a lower interest rate. Meanwhile, the former head of the World Bank for Latin America, Augusto de la Torre, explained that the country should extend a probable issuance as long as possible and focus on the search for more "multilateral loans."     

Source: Primicias

 August 18, 2022

According to Ecuador's Minister of Production, Foreign Trade, and Investment of Ecuador, Julio José Prado, the country expects to close a free trade agreement with China this year. This statement was made by the Minister at a presentation during the XV China-Latin America and the Caribbean (China-LAC) Business Summit. The Minister declared that the government expects that negotiations for a trade agreement between China and Ecuador "conclude this year" and that they can be "announced during the summit" that will take place in the Ecuadorian city of Guayaquil in December. Likewise, Ecuador will become the fourth Latin American country to endorse a trade agreement with China after Chile, Peru, and Costa Rica. In addition, he stressed that Ecuador "is one of the most stable economies" in the region and a country that seeks to "promote a profound, continuous transformation," based on rules of competitiveness. At the conference, the Ecuadorian Ambassador to China, Carlos Larrea, declared that "looking at Asia is looking at the future of the world" and that the Asian country, in particular, has continued "expanding its opening to the outside world," optimizing its trade structure.  

Source: Swissinfo

 August 17, 2022

According to data from the Central Bank of Ecuador, in the first half of 2022, the country exported USD 2,192 million to China in non-oil products, which reflects a growth of more than 100% between 2021 and 2022. Meanwhile, exports to the United States reached USD 2,031 million, USD 161 million less than the Asian giant. In the first half of 2021, Ecuador sold more to the North American nation (USD 1,745 million) than China (USD 1,066 million). However, the key point is that both countries import Ecuadorian shrimp the most. Overall, Ecuador exported a total of USD 16,868 million, with a growth of 34%, composed of oil exports (USD 6,236 million) and non-oil exports (USD 10,632 million). The three main products exported during the first semester were crude oil (USD 5,336 million), shrimp (USD 3,791 million), and bananas and plantains (USD 1,701 million). Meanwhile, imports totaled USD 14,867 million, an increase of 41% compared to 2021 (USD 10,555 million). The leading countries of origin of imports were the United States (USD 3,784 million), China (USD 2,989 million), and Colombia (USD 944 million). The difference between exports and imports leaves a surplus of USD 2,001 million in the total trade balance. Meanwhile, the non-oil trade balance left a deficit of USD 480 million. Finally, the oil balance totaled USD 2,481 million.   

Source: Bloomberg en Linea

 August 17, 2022

Among the goals that the Minister of Economy and Finance, Pablo Arosemena, has mentioned that he seeks to correct are the pending payments or arrears that the State maintains with other public entities and suppliers. However, amid scarce resources, this remains a pending task. Although that figure has begun to decline, the internal debt has been increasing. According to figures from the Budget Execution of the Ministry of Economy and Finance (MEF), assets in June totaled about USD 2,700 million. However, that figure fell to USD 1,600 million in one month, equivalent to 1.6% of the GDP. According to Jaime Carrera, the Secretary of the Fiscal Policy Observatory and former advisor to President Guillermo Lasso, although there is a drop, this does not mean that the government is doing the complete task of catching up on its payments, highlighting that more than canceling, what has happened is a correction in the figures. Of the USD 2.7 billion in arrears recorded in June, some USD 2.2 billion corresponded to the 40% contribution to Social Security pensions.  

Source: Expreso

 August 16, 2022

In a review of macroeconomic figures, an economic recovery is evident. On the one hand, according to the latest Gross Domestic Product (GDP) data, the Ecuadorian economy increased by 3.8% during the first quarter of 2022, the fourth consecutive quarter with a positive annual variation. This reflects the reactivation of economic and productive activities but has become more moderate. In addition, for the first time in more than a decade, the overall result of the General State Budget is positive in the first half of the year (USD 438 million) as a result of an increase in revenues exceeding expenditures. Also, exports continue to grow as they totaled USD 13,817 million between January and May, increasing by 34% compared to 2021. With these figures, the trade balance registered a surplus of USD 1,639 million. However, despite the promise to increase oil production, it was only 472 thousand barrels per day in the first half of the year, lower than the average of 501 thousand reported in the same period of 2021, implying that the country is not taking advantage of the high crude oil prices and, in turn, higher tax revenues. Although the results obtained so far this year show an economic recovery, the government's performance in the social sphere has left much to be desired. In this regard, internal factors, such as inefficient spending, insecurity, political and social fragmentation, and external factors (war, inflation, and world recession) may be conducive to a complicated second half of the year and an even more uncertain 2023. 

Source: Revista Gestion

 August 16, 2022

The Ecuadorian state-owned company, Petroecuador, announced a few hours ago that it needs to select a strategic partner that provides the relevant Specific Integrated Services with Contractor Financing (SEIFC) to increase production and reserves, and maximize the expected recovery of Block 60 - Sacha, operating together with EP Petroecuador. For these purposes, the corresponding bidding process has just been launched. The first phase of the bidding process starts on August 17th with the reception of letters of interest until September 16th, 2022, from the companies that wish to participate in the process. Subsequently, a Data Pack containing the technical, economic, and legal information will be made available to the participants. Meanwhile, Petroecuador also invited interested national and international companies to participate in a bidding process to increase production and reserves and maximize the ultimate recovery of deposits in 22 fields. Companies that wish to participate in this process may send their letters of interest to EP Petroecuador’s mail. This bidding process also seeks to select a strategic partner (or strategic partners) that provides the relevant Integrated Specific Services, with Financing from the Contractor (SEIFC) in 22 fields, in groups of four, and to operate jointly with EP Petroecuador.

Source: El Universo

 August 15, 2022

One of Guillermo Lasso's main promises, to produce up to 1 million barrels of oil per day to boost the economy, continues to show no signs of progress. At the beginning of Lasso's mandate in May 2021, Ecuador's oil production was around 497 thousand barrels per day, a figure that has been maintained for more than a year and has even dropped due to problems of pipeline ruptures or the strike last June. The target for the end of 2022 is 580 thousand barrels per day (bpd), an additional 80 thousand bpd. Oil analysts consider that the goal, which at the beginning seemed ambitious, is now more complicated due to scandals in Petroecuador and the lack of transparency in the progress of the renegotiation of oil contracts. "It is very worrying because the goal of one million barrels is very far away (...) The oil sector has lost its path," said Fernando Santos Alvite, former Ecuadorian Minister of Energy. Meanwhile, Ecuador has been benefiting from high oil prices. Between March and the end of May, the price of a barrel of oil reached an average price of USD 107, according to the IMF; therefore, some USD 760 million is expected in profits for the country. On the other hand, high oil prices generate higher spending on fuel subsidies, which are estimated to be around USD 3 billion in 2022. 

Source: Expreso

 August 15, 2022

According to a report by the International Monetary Fund (IMF), Ecuador is among the countries that subsidize fuels the most globally. In this regard, the multilateral agency pointed out that more than 50 countries have reformed their subsidy policy in the last decade, taking advantage of the moments of low oil prices in the international market. Although reforms began in the country in 2018 to reduce fuel subsidies, these adjustments have had ups and downs. For this reason, Ecuador ranks 15th out of 33 countries that still subsidize diesel, gasoline, and Liquefied Petroleum Gas (LPG). If only diesel is considered, Ecuador is among the eight countries that transfer the most generous subsidies globally. In this regard, it may be observed that, in 2022 alone, the Ecuadorian State will allocate USD 3,128 million to this benefit due to increased oil prices in the international market. Compared to 2021, when these monetary transfers totaled USD 2,214 million, this figure implies an increase of 41%. On the other hand, concerning fuel price control policies, there are four types of measures that different countries have applied, including attempting to reduce subsidies, reducing fuel taxes, and creating oil funds to stabilize fuel prices. 

Source: Primicias

 August 12, 2022

The appointment of the head of the Superintendence of Banks has confronted two powers of the State; in the middle is also the Participation Council, which follows a new appointment process. In addition, the Assembly issued a resolution in which the head of the Legislative Branch, Virgilio Saquicela, was ordered to process the immediate possession of Raúl Gonzáles as the Superintendent of Banks. The motion in the Legislative Branch's plenary session was presented by Mireya Pazmiño, from the radical wing of Pachakutik, who had the support of assembly members from the Correism movement of Union for Hope (UNES), the Social Christian Party (PSC), and Pachakutik. According to various Ecuadorian analysts, the appointment had to be established "according to law," even though it was not to the liking of Guillermo Lasso. According to the political analyst, Rodrigo Jordán, this scenario could unfold various consequences: "A new estrangement between the National Assembly and the President of the Republic; and that a political problem is generated by knowing who is going to be the political-institutional leader of the Superintendence." In addition, he stressed that this new departure is "dangerous" for the Executive Branch, given that it would strengthen the opposition's bloc which, in turn, will bring consequences for Ecuador's political stability. 

Source: El Comercio

 August 12, 2022

According to a report by the Ministry of Economy and Finance, the national productive sector between January and July 2022 reached sales of USD 120,079 million, USD 12,387 million higher than those achieved in the same period of 2019 (USD 107,692 million), as the commercial sector surpassed the levels registered before the pandemic. Although the report does not provide details by industry, representatives mention that they are not yet reflected in the good results of, among others, the restaurant sector. This sector has been affected by insecurity in the country. Nicolás Romero, a member of the Restaurant Association of Guayas, declined to say if they will achieve a higher turnover than the one registered before the health crisis this year. Meanwhile, according to the official journal of the European Union, the bloc authorized the entry of aquaculture products from Ecuador. In addition to Ecuador, Brazil, Colombia, Costa Rica, Honduras, Mexico, Peru, and Panama, 12 Asian countries and farmed finfish from Morocco were authorized. The measure is retroactive and came into effect on August 2nd. This list update comes after the EC gave the go-ahead to fish residue monitoring plans under the "aquaculture" category. Ecuador exports five main seafood products, fresh and processed: shrimp, fresh tuna, fresh fish, fishmeal, and others.

Sources: Expreso, Primicias

 August 11, 2022

The reactivation of Ecuadorians' consumption and higher levels of inflation have decreased the population's savings capacity since March, evidenced in the evolution of private bank deposits, which by July this year totaled USD 40,973 million. The figure represented an increase of 7.2% compared to 2021, the lowest rate since September 2020. On the other hand, between 2020 and 2021, growth rates reached up to 14% because consumption levels decreased due to uncertainty, allocating money to more savings. In 2022, Ecuadorians reactivated their consumption, and "excess savings" dropped to levels similar to those reported in 2019. Another factor that has decreased people's savings capacity is rising inflation rates, driven partly by the Russian invasion of Ukraine in February 2022. In addition, the 18-day strike called for by the CONAIE affected the performance of deposits as people sought to have cash in the context of a social crisis. At the same time, companies received less income to credit to their accounts that month due to the drop in sales in June. Although the benchmark deposit rate was 5.75% in August, with the increase in inflation rates, the remuneration for depositors ends up being lower than in 2021 in real terms. In July 2021, the annual inflation rate was 0.45%, while it rose to 3.86% in July 2022. In this sense, it is advisable to invest in longer-term savings instruments in the context of higher inflation rates.

Source: Primicias

 August 11, 2022

After the participation of 17 assembly members from different parties, the plenary session concluded on August 9th for the first debate on the bill to repeal the tax reform. The text consists of an article and is called the Law that Repeals the Organic Law for Economic Development and Fiscal Sustainability after the COVID-19 Pandemic, which entered into force on November 29th, 2021. In session 790, assembly members from Pachakutik, Correism (UNES), the Social Christian Party (PSC), and dissidents from the Democratic Left (ID) closed ranks in favor of this initiative. However, Salvador Quishpe and Joel Abad, from the indigenous movement's bloc, blamed the UNES for allowing the tax reform to enter into force by Operation of Law when it abstained from voting in November 2021. Likewise, Viviana Veloz from UNES considered that Guadalupe Llori (PK) made a serious mistake by omitting details about the vote in the official letter she sent to Carondelet. For their part, the opposition's assembly members argued that article 140 of the Constitution establishes that "when, within the period indicated, the Assembly does not approve, modify or deny the project described as urgent in economic matters, the President of the Republic will promulgate it as a decree-law and will order its publication in the Official Gazette." 

Source: El Comercio

 August 10, 2022

Last Monday, Ecuador and Costa Rica began negotiations for a future Free Trade Agreement (FTA) in a first round that seeks to advance in regulatory issues, informed the Costa Rican government. "Costa Rica expects this first round to achieve substantial progress in the regulatory part to then focus on negotiating market access. Both countries are interested in conducting a negotiation process under a simple approach, with the possibility of reaching a mutually satisfactory agreement in the short term," said the Costa Rican Foreign Trade Minister, Manuel Tovar. In the last bilateral meeting within the framework of the Summit of the Americas, the President of Costa Rica, Rodrigo Chaves, and the President of Ecuador, Guillermo Lasso, agreed to negotiate an FTA starting this year. The countries will review regulatory issues on market access, rules of origin, trade facilitation, and sanitary and phytosanitary measures in this first round of negotiations. According to official data, trade between Costa Rica and Ecuador in 2021 reached USD 74.6 million, USD 49.8 million of which corresponds to Costa Rican exports and USD 24.8 million to Ecuadorian exports. Ecuador mainly sells fish preparations and canned fish, fresh fish, steel wire, medicines, textiles, and shrimp, among others, to Costa Rica. Meanwhile, Costa Rica sells scrap metal, drugs, electronic materials, tires, cardboard, and other industrial materials to Ecuador.  

Source: El Universo

 August 10, 2022

According to the Ministry of Economy, Ecuador has complied with the interest payments it must make to investors who bought their bonds on the international market. This announcement was made known once the Luxembourg justice ordered the freezing of Ecuadorian assets in that country at the request of the oil company, Perenco, which claims a payment of USD 374 million to the State. "The Ministry of Economy and Finance ratifies that there has been no problem in the payment to holders of Ecuadorian debt. Ecuador has punctually complied with the payment of the amortization and interest coupon of its international bonds, which corresponds to the last day of July, for USD 185.7 million," the entity assured. The Ministry also assured that the country would comply with the arbitration award in the Perenco case. "However, this compliance will be done safeguarding the interests of the Ecuadorian State." In addition, it explained that Perenco "has debts with the Internal Revenue Service, and this has made it difficult to pay the award," so "an agreement is expected to be reached with this company, which no longer operates in the country, to establish an adequate payment mechanism until a legal definition of tax obligations is reached, an aspect that is being processed in judicial instances in the United States."   

Source: Bloomberg en Linea

 August 09, 2022

So far in the first quarter of 2022, using the information on the country's Gross Value Added (GVA) by industry published by the Central Bank of Ecuador (BCE), the construction sector has reported a decreasing trend since 2018, which accentuated in 2020 when the industry decreased by 20% compared to 2019. The decreasing trend is partly due to the reduction of the State's total expenditure, the availability and access to products affected by the war in Europe, and the global logistics problem. According to experts, in the first quarter of 2022, the State's public investment expenditure was reduced by up to 82.3% compared to the same period in 2021 due to fiscal deficit adjustment programs driven by the central government. It is worth noting that, according to the Chamber of the Construction Industry, in 2021, more than 70% of the sector's sales corresponded to public sector works. Meanwhile, a generalized increase in the prices of construction products since May 2021 has also had an impact due to the shortage of raw materials such as aluminum, steel, and clay, which are imported mainly from Russia and Ukraine. In addition, analysts explained that both the decrease in sales and the generalized increases in the price level of the necessary goods used for construction translate into a negative evaluation by the companies related to the sector. 

Sources: El Universo

 August 09, 2022

The Development Bank of Latin America (CAF) approved a credit line of USD 45 million for Banco Pichincha. The institutions signed a general agreement for financing on August 8th, 2022. According to what was stated by Banco Pichincha, the multilateral agency's resources will be channeled to finance portfolio in foreign trade, working capital, investment in fixed assets, financing of letters of credit, financing of green businesses, and energy efficiency projects for Corporate clients, SMEs, and personal banking. According to the President of the institution, Antonio Acosta, "Banco Pichincha consolidates its commitment to attracting sources of external financing to support the productive sector in its investment and development plans." Likewise, he explained that as of July 2022, Banco Pichincha's credit portfolio is USD 9,574 million, 27% more than in July 2021. The signing of the Credit Line Framework Agreement between the CAF and Banco Pichincha is part of the ongoing projects that the parties have been working on for several years. The signatories of this agreement were Daniel Rivera Bonell, on behalf of the CAF, and Alejandro Ribadeneira Jaramillo, on behalf of the financial institution.

Sources: Primicias, Bloomberg en Linea

 August 08, 2022

Last May, China became Ecuador's number 1 partner as the largest destination for its non-oil exports, a position previously held by the United States. According to data from the Central Bank of Ecuador (BCE), between January and May 2022, China ranked first in non-oil exports with USD 2,348 million; followed by the U.S.with USD 1,808 million, the European Union with USD 1,677 million, Russia with USD 405 million, and Colombia with USD 393 million. "Of the non-oil exports up to 2021, the U.S. was first, followed by China and then the European Union. Between January and May, China came first," said Daniel Legarda, the Deputy Minister of Foreign Trade. Likewise, China's growth as a destination for Ecuadorian products reached 109.7% in the first five months of 2022 compared to the same period of 2021. Meanwhile, exports to the United States increased by only 16% in the same period. In this sense, Legarda explained that a significant component is the growth of shrimp exports to China and other fishery products and bananas. "Undoubtedly, shrimp is the one that generates a great push for this growth rate," said Legarda. According to the Deputy Minister of Foreign Trade, the United States still holds the leadership in exports if oil is considered. In this regard, total shipments to the United States totaled USD 3,849 million, followed by China with USD 2,401 million.  

Sources: Expreso, El Universo

 August 08, 2022

The President of Ecuador, Guillermo Lasso, met last August 7th with representatives of Paraguay and Mexico during his visit to Colombia, where he traveled to participate in Gustavo Petro's inauguration ceremony. Mexico's Foreign Minister, Marcelo Ebrard, classified the meeting with Lasso as decisive since he considers that Ecuador and Mexico are very close to reaching an agreement, according to the General Secretariat of the Presidency. Likewise, after his meeting with Guillermo Lasso, the President of Paraguay, Mario Abdo Benítez, ratified his support for Ecuador: "We believe that we have economies that can complement each other and enormous potential to increase trade and strategic alliances to strengthen the fight against Organized crime."  

Source: Swissinfo

 August 05, 2022

The risk rating agency, Moody's, affirmed that there is no evidence that Ecuador defaulted and mentioned that the government intends to resolve the payment of the award and comply with its market debt commitments. This information came after a Luxembourg judicial authority ordered banks in that country to freeze Ecuador's assets in their accounts due to a dispute over a USD 391 million settlement that the Anglo-French oil company, Perenco, says remains unpaid. In addition, the Ministry of Economy and Finance (MEF) has not clarified whether the government was able to meet the coupon (interest) payments to bondholders, which were due by July 31st. However, the Lasso administration has expressed that it will honor the payment mechanism with Perenco. Meanwhile, the U.S. State Department published its 2022 investment climate analysis, which, in the specific case of Ecuador, mentions that, although Guillermo Lasso's government seeks to boost investments, it faces significant challenges due to Ecuador's reputation as a high-risk country for investment. In addition, the challenging relationship with the National Assembly should be mentioned, which complicates the approval of the necessary economic reform legislation. It should also be noted that economic, trade, and investment policies are subject to frequent changes and may increase the risks and costs of doing business in Ecuadorian territory. 

Sources: Expreso, Expreso

 August 05, 2022

In July 2022, Ecuador’s Consumer Price Index stood at 109.51, with which the country’s monthly inflation rate was calculated at 0.16%, compared to the previous month, which was 0.65%. In addition, the inflation rate stood at 3.86% in year-over-year terms. Although the rate grew compared to 2021, when compared to June of the previous year, a reduction was reflected. The country’s annual inflation rate in June was the highest of the year due to the 18-day strike that led to general price increases. Therefore, the reduction reported in July translates into greater price stability. Meanwhile, within the segments, it may be observed that personal care products drove the price increase in July 2022. There are 12 consumer divisions in the IPC basket, and the food and non-alcoholic beverages item was the one that most affected the rise in prices in June. For July, this item occupies the third place, which shows that prices are stabilizing. Now, it is preceded by the items of various goods and services and restaurants and hotels. The INEC also released the data corresponding to the Basic Family Basket, which stood at USD 753.62 in July.

Sources: Bloomberg en Linea, El Comercio

 september 23, 2022

The government of El Salvador announced that the 2023 and 2025 bondholders that decided to "accept" the country's offer for the early purchase exceeded the amount defined for this transaction. According to the official statement, the bids totaled USD 612 million, of which the government accepted USD 565 million. However, the government also indicated last week that it had USD 360 million available for this operation. Thus, 22.4% of the amount of the 2023 bonds was offered to be repurchased, and 54% of the 2025 bonds.

"Given that the amount to buy back the aggregate principal amount of the bonds tendered exceeded the maximum aggregate tender amount, the principal amount of the validly tendered bonds of each holder... the Republic has only accepted offers of bonds subject to proration," the official statement said. The settlement of the validly tendered bonds is scheduled for tomorrow, and the Ministry of Finance is expected to give details on how they will make this payment and where the funds to do so will be obtained. The 2023 bonds averaged USD 75 (although they dropped at some point to USD 63), while the 2025 bonds averaged below USD 40 and raised to an average of USD 45. The government said it would pay USD 91 for the 2023 bonds and USD 51 for the 2025 bonds.

Source: La Prensa Gráfica

 september 23, 2022

During an interview, the President of El Salvador, Nayib Bukele, affirmed that the Salvadoran government will work with the President of the United States, who is elected in the presidential elections to be held in 2024. In this sense, Bukele assured that he did not favor any U.S. presidential candidate and said, "I am not a U.S. citizen, so I am not allowed to support any president." In this regard, Bukele stated in the interview, "we will work with any president. At this moment, it is President Biden, and we have worked well with President Trump. Therefore, we will work well with any president, but electing him is a matter of the Americans." Additionally, when asked about the war between Russia and Ukraine, the President defended the idea of seeking peace and said, "there will eventually have to be peace. I don't know when, but there will be; we all want peace. And I am hopeful that eventually, peace will prevail in Ukraine; the faster, the better."

Meanwhile, in another interview with international media companies, the President affirmed that the country is on its way "to being the safest country in all of the Americas," which he attributed to his administration's efforts to fight organized crime in the country.

Sources: El Mundo, El Mundo

 september 22, 2022

El Salvador registered USD 6,949 million more in imports than exports in the first eight months of 2022, according to a report on foreign trade and family remittances presented yesterday by authorities of the Central Reserve Bank (BCR). Thus, the trade balance shows an imbalance between what the country buys from other nations and what it sells. Imports, which from January to August this year grew by 25.5% compared to the same period of 2021, totaled USD 12,040 million, more than double the amount El Salvador obtained with exports in that period of 2022, which reached USD 5,091 million.
In August alone, the country imported USD 1,655 million versus exports of USD 609 million. "The trade gap continues to grow," said economist José Luis Magaña, explaining the trend shown by both items in which imports are more than sales. "In the context of a dollarized economy, more dollars are going out than coming in. This is only compensated by the flow of family remittances that make it possible to compensate for this gap. This, in addition, implies a strong vulnerability of the national economy to what happens in international markets," he explained.

Sources: El Salvador

 september 22, 2022

The National Association of Private Enterprises (ANEP) and the Chamber of Commerce and Industry of El Salvador (Camarasal) communicated their rejection of the possibility of an immediate presidential reelection in El Salvador following President Nayib Bukele's announcement of his intention to run for the presidential elections to be held in 2024. According to the ANEP, articles 75, 88, 131, 152, 154, and 248 of the Constitution of El Salvador prohibit an immediate presidential reelection.
Meanwhile, the Vice President of El Salvador, Félix Ulloa, assured that President Bukele could opt for the presidential elections in 2024 but could not apply for a third term, that is to say, the presidential period of 2029-2034. In this regard, Ulloa pointed out that President Bukele can run again as a presidential candidate with the support of any political party in the country and argued that "the President can register in any party because article 226-A of the Electoral Code says that the Turncoat Law applies to officials who have been elected for deputies and mayors. In any of these cases, if there is a coalition, he runs as a candidate for the coalition or the party of his preference."

Source: El Mundo, El Mundo

 september 21, 2022

At the 77th General Assembly of the United Nations, the President of el Salvador, Nayib Bukele, assured that the country continued to seek its independence as a nation and maintained that "to be free, as much of what defines us, it depends on how others see us, but mainly on how we see ourselves. Therefore, in addition to deciding that we want to be free, it is an indispensable requirement that the powerful respect our freedom." Likewise, he requested the countries present at the Assembly to respect El Salvador's sovereignty and the determination of Salvadoran people. In this sense, Bukele affirmed that in recent months, El Salvador had made progress in terms of financial freedom, governance, and the fight against organized crime; furthermore, he pointed out that "in a short time, El Salvador has gone from being the most dangerous country in the world to being on its way to being the safest country in the Americas." In this context, the President indicated that El Salvador is open to maintaining bilateral relations with those countries that wish to do so.

Meanwhile, the President of the Legislative Assembly, Ernesto Castro, assured that the country was going through a significant transformation and stated, "El Salvador is becoming an example of hope. Yes, we can change and take charge of our destiny."

Sources: Diario El Mundo, La Prensa Gráfica

 september 21, 2022

According to Diario El Mundo, El Salvador exported USD 565 million of its star product, shirts, up to last August. From January to August, business people exported USD 729.7 million more than a year ago. Although El Salvador's export basket includes more than 800 products, 18% of the country's sales are concentrated in two items that are the best sellers: shirts and sweaters. The Central Reserve Bank (BCR) registers that exports of shirts represented USD 565 million between January and last August (with a 12.5% growth), while sweaters represented USD 348 million (an additional 25.4%).

Both items represented revenues of USD 913 million, 18% of the USD 5,090.8 million in total exports as of last August. This shows the weight of the textile and clothing industry on the Salvadoran economy, which in addition to being responsible for almost a quarter of exports, is the largest generator of formal jobs. Plastic containers are the third most exported item, with shipments valued at USD 200 million (26.8% growth), followed by sales of electrical semiconductors with USD 183 million (15.4%), a product that only Kyocera AVX has been manufacturing since 1977. 

Source: Diario El Mundo

 september 20, 2022

The vice president of the republic, Félix Ulloa, today defended the constitutionality of the immediate presidential re-election and reiterated that he would have to replace President Nayib Bukele if he asks for permission six months before the end of his term, that is, from December 1, 2023. According to the Constitution, the vice president replaces the president when he is absent for legal reasons. If the president asks for permission for six months, it would be up to the vice president to replace the president. 
Ulloa has not yet answered whether he will be part of a presidential ticket with Nayib Bukele or if he will ultimately replace Bukele in the Presidency in the last six months of the 2019-2024 term.
When asked by a journalist if you would be competing for the vice presidency?, she replied that it is not yet under discussion.  Additionally, Vice President Félix Ulloa reiterated that the immediate presidential re-election is constitutional: "there is no prohibition in that sense, read the articles well, read Article 88 well, read Article 154 well, read Article 152 well, what there has been is a series of lies from the perverse, malevolent and malicious confusion that the 2009-2018 Chamber did. Their intention was to prevent Mauricio Funes from running as a candidate. 

Source: El Mundo

 september 20, 2022

The rating agency Standard & Poor's noted that El Salvador's credit rating has the worst rating in Central America. In June of this year, the agency rated El Salvador with the CCC+ grade, placing the country's rating two stories below the region's rating average of B. In this sense, different countries in the region such as Guatemala and Costa Rica are above the rating of El Salvador with a rating of B; meanwhile, Honduras and Nicaragua have ratings of B- and BB-. It is noteworthy that the rating of El Salvador began to reduce after the dismissal of the magistrates of the Constitutional Chamber and the adoption of the implementation of the Bitcoin Law in the country by the president, Nayib Bukele.
In this context, the latest S&P report noted that "sovereign ratings in Central America have remained constrained by fragile institutions in a context of weak checks and balances, low per capita income and low economic growth and, in some cases, moderate debt levels and limited fiscal space." In addition, different international organizations such as the IMF have repeatedly warned about the complicated financial situation in which El Salvador finds itself, which in turn affects the country's rating.

Source: El Salvador

 september 19, 2022

The Inter-American Development Bank (IDB) approved a $100 million loan to improve water supply and sanitation in El Salvador. The loan is expected to benefit 120,000 households with potable water service in the San Salvador Metropolitan Area (AMSS), with a five-year term structured for 25 years of amortization and a grace period of five and a half years. The financing will go to the Administración Nacional de Acueductos y Alcantarillado (ANDA) to optimize its performance and sustainability, and modernize its operations.

"With this contribution, the country will focus on improving the continuity of potable water services in the AMSS, reducing the levels of water not charged in the AMSS, improving energy efficiency in the northern zone system that supplies the AMSS, and ANDA's business management," the multilateral agency said. The IDB estimates that 1.8 million people will benefit from the strategy. The loan made by the financial institution is part of the IDB Group's Vision 2025, which has been implemented since last year. Vision 2025 is a strategy implemented by the current IDB administration, which, between 2021 and 2025, plans to respond to the challenges faced by Latin America and the Caribbean due to climate change.

Source: El Mundo

 september 19, 2022

Last Thursday, the President of El Salvador, Nayib Bukele, announced that he would seek to be reelected in the 2024 presidential elections. The President's announcement was made during the 201st anniversary of El Salvador's independence. He referred to the state of emergency regime and affirmed his commitment to continue fighting violence in the country. It is noteworthy that the Constitution of El Salvador prohibits a president's reelection in articles 75, 152, and 248; sentence number 163-2013 also prohibits an immediate presidential reelection. In this sense, Bukele assured that there would be some questioning from the international community after the announcement and affirmed, "more than one developed country will not agree, but they are not the ones who will decide. It is the Salvadoran people."

Furthermore, he emphasized that "all of them have reelections. We must copy those doing well. Prohibitions on reelections are only in third-world countries.

 The people should have the right to reject or continue with a president. If the people feel they are doing well, they should ratify their desire to continue."

 Meanwhile, the President of the Legislative Assembly, Ernesto Castro, stated in this regard, "for the first time, we are living a national unity never seen before. For the first time, we are celebrating independence in this country." At the same time, different opposition deputies expressed their rejection of the idea of the President's reelection.

Source: La Prensa Gráfica

 september 16, 2022

The U.S. Secretary of State, Antony Blinden, remarked on his government's commitment to establishing bilateral relations with El Salvador. In this sense, Blinken indicated that both countries should work on building relationships that focus on mutual objectives, such as "the fight against transnational crimes, the promotion of security, good governance, and human rights, economic growth, and humane migration management." In addition, he said, "Salvadorans seek security and prosperity for their families and the ability to celebrate their freedoms, aspirations that the people of the United States also share." Blinken highlighted the work of the Salvadoran government during the COVID-19 pandemic and said, "El Salvador and its people demonstrated impressive resilience to face the CODI-19 pandemic, with the support of donations of medical supplies and more than three million doses of Pfizer and Moderna vaccine from the American people.
Meanwhile, El Salvador's Legislative Assembly announced a new extension of the state of emergency regime in the country. The new regime will be extended until October 18th and was approved by 65 votes in favor and 12 against. In this regard, Deputy Numan Salgado stated, "we have seen that the population has expressed that it totally agrees with the implementation of the regime. The only ones who disagree are those affected by it."

Source: El Mundo, El Mundo, La Prensa Grafica

 september 16, 2022

El Salvador took another step down in its sovereign debt rating after the risk rating agency, Fitch, downgraded the country from "CCC" to "CC." In February of this year, the rating agency placed the country in the "CCC" category due to the growth of short-term debt, financial needs, and uncertainty over the bitcoin. Having a "CCC" sovereign debt rating means it is vulnerable to adverse conditions and relies on favorable conditions to meet financial obligations. 
With the downgrade to the "CC" category, the rating agency understands that the country is expected to default, a scenario foreseen due to the proximity of the maturity of the payment of USD 800 million in bonds that are scheduled for January next year. To try to solve this situation, last July, the government of Nayib Bukele announced its intention to buy back its debt, offering bondholders to pay the debt in advance for the 2023 and 2025 bonds at market price. To carry out this operation, the Ministry of Finance had proposed a transaction of $560 million. However, at the official launching of the bond repurchase, only $360 million was offered for the bonds whose holders were willing to sell. These situations were considered by Fitch, which noted in its press release that "the size and scope of the transaction do not materially alter the probability of default."

Source: El Economista

 september 15, 2022

On Tuesday, prices of El Salvador's bonds maturing in 2023 and 2025 fell after the announcement of the government's proposal to repurchase the country's external debt. In this regard, El Salvador's President, Nayib Bukele, announced on Monday the call for bondholders to submit a bid for the repurchase of bonds for an amount not exceeding USD 360 million, a process that will close on September 22nd.

This tender includes securities maturing in 2025, although the most significant concern for the market is 2023 due to the risk of default, given the Salvadoran government's liquidity pressures.

On the first day after the announcement, both issues fell slightly. Securities maturing in 2023 closed at USD 88.02, down 0.29 % compared to Monday's results. However, the price of the bonds had been recovering from the lows seen at the beginning of the year after the government announced last July 26th its intention to repurchase them. At that time, the 2023 issue was quoted at USD 73.01; with the value seen yesterday, there is an increase of 20.5%. The issue maturing in 2025 experienced the same behavior. So far this month, it has traded above USD 49, but between September 12th and 13th, it went from USD 48.98 to USD 48.50, a loss of 0.98% of its price in a single day.

Source: El Economista

 september 15, 2022

After the criticism of U.S. government officials to the state of emergency regime in El Salvador, the President of El Salvador, Nayib Bukele, affirmed the government's commitment to combat violence in the country and said that "While some members of congress want us to return to the past of death, we continue to demonstrate that without them we are much better off." In this sense, different Salvadoran congress members have reiterated their support for the state of emergency regime on several opportunities and have affirmed that it will be extended again.

Meanwhile, the opposition's congressman, Johnny Wright, pointed out that the extension of the state of emergency regime in the country could affect El Salvador's diplomatic relations with the United States. In this regard, Wright pointed out that since the beginning of the state of emergency regime in March, different human rights violations have been carried out in the country. In this context, the United Nations Resident Coordinator in El Salvador, Birgit Gerstenberg, assured that the measures adopted by the Salvadoran government to combat violence and insecurity in the country "must be framed in respect for human rights;" and said, "I reaffirm my conviction and commitment to work for the unrestricted respect of human rights as the path to the sustainability of the eradication of violence and the construction of a sustainable, inclusive, and egalitarian peace."

Source: El Mundo, Prensa Latina, La Prensa Gráfica, Telesur

 september 14, 2022

At noon on Monday, the government of El Salvador announced that bondholders could submit their "offers" for the bonds to be purchased by the State. The invitation started at noon New York time and ends (if there are no changes) next Tuesday, 20th, detailed a communiqué distributed to stock brokers. The maximum amount that could be paid is USD 360 million, which will be settled next September 22nd. However, the prices to be paid for the bonds are overpriced. For example, the government will give USD 91 for the 2023 bond (which at the closing time of this note was at USD 88.28), while for 2025, the government will pay USD 54, and its current price is USD 48.98.
"El Salvador reserves the right, at its sole discretion, to accept only a portion of the bonds offered if the maximum amount of the offer is reached, not to accept any or all of the offers, and to extend or terminate the invitation concerning one or more series for any reason," according to the official statement. The Minister of Finance, Alejandro Zelaya, had indicated in a television interview that the country had USD 560 million to make this anticipated purchase of public debt and that the transaction would be completed before September 15th.

Source: El Economista

 september 14, 2022

According to the National Association of Private Enterprises (ANEP), El Salvador could end 2022 with an inflation rate of 8 %. "We have gone through a long period of 11 years of low inflation rates, but in the last 20 months, we have an accumulated inflation rate of almost 14 %, which is the impact felt by the population," stated Waldo Jiménez, ANEP's Economic Affairs Manager. In August, the country closed with an inflation rate of 7.66 %. According to Jiménez, there are international signals that could indicate that in the following month, inflation will decrease, such as the price of oil, corn, and wheat, after the increases presented by the war in Ukraine.
"We expect that inflation will start to give way at the end of this year, but that does not mean that prices will return in 2023 to the levels we had in 2019; the global situation will not have been solved by 2023, and we will continue with high prices, but not as high as the ones we have today," he clarified. Likewise, he considered that in 2023, inflation would be below 6%. Jiménez indicated that the only way to face all these situations is with private investment.  

Source: El Economista

 september 13, 2022

The Emerging Market Bond Index (EMBI) reached 24.21 % as of September 8th, 34 basis points higher than the previous day and 1 point higher than at the end of last week. On the other hand, the prices of sovereign bonds registered a weekly fall of up to -6 %. In the case of the 2023 bonds, these fell by -0.15 on Friday but gained 0.17 during the week, reaching USD 88.28. The 2025 Eurobond also fell by -0.67 % during that period to close with a price of USD 49.02, and the 2035 Eurobond lost 5.9 % from September 5th to 9th, with a closing price of USD 32.95. The lowest of the ten issues listed in the international markets is quoted at USD 25.

After the announcement made by the Ministry of Finance last July 26th, where it assured that they were going to make a "public, transparent, and voluntary" offer, i.e., a debt repurchase or early purchase of the bonds maturing in 2023 and 2025, these slight increased in their prices. However, the prices of the bonds not affected by this operation (repurchase), according to sources consulted by Prensa Grafica," are suffering. The market is practically highlighting that it sees a significant risk of default even in the other bonds."

Source: El Economista

 september 13, 2022

The Executive Director of the National Association of Private Enterprises (ANEP), Leonor Selva, indicated that a reduction in the demand in the United States could reduce the export of Salvadoran products. In this sense, Selva stated that "many of the exporters have observed a reduction in the demands of their products and as they are products with a low level of demand of trained human capital, they can easily change location." In this regard, the association's Director indicated that the demand in the North American market was decreasing and pointed out that the United States currently has an excess of product storage. 

Additionally, Selva stated that the Salvadoran government should encourage investments in the country and argued that "the two fundamental issues in terms of the country are productivity and competitiveness. What is competitiveness? Remember that El Salvador is not an island, so if we want to attract investment, we are not only selling ourselves but competing with the rest of Central American countries." It is noteworthy that the United States is El Salvador's leading trading partner; by July 2022, the country had exported a total of USD 277 million to the U.S. market, representing 40% of the country's total exports in that month

Source: El Mundo

 september 12, 2022

According to LPG Datos, the social research unit of La Prensa Gráfica, a year after it came into force as legal tender in the country, 78% of Salvadorans do not accept or receive bitcoins when they are offered as a means of payment. Respondents were asked the following question: Do you personally accept and receive bitcoins as a form of payment when someone offers to do so? 21.1% said yes, 77.9% said no, and 1% did not respond. The main reasons for not accepting it are that it is unknown, they have not had the opportunity, or they do not use the currency.
Last year, before the entry into force of the Bitcoin Law, LPG Datos asked citizens if they were willing to accept and receive bitcoins when offered to them as a form of payment: 20.8% said yes, 72.2% said no, while 7% did not respond. Therefore, the figures show that already in practice, the bitcoin has failed to attract more followers than it did a year ago. The research explored whether the idea that the bitcoin is an insecure currency persists. Last year, 53.5% of respondents thought that the currency seemed somewhat or very insecure, against 26.2% who considered it rather or very secure (20.3% did not answer). 

Source: El Economista

 september 12, 2022

Through a report published by the State Department on the investment environment in El Salvador, the U.S. government recognizes the government's efforts to attract investment. However, it warns that there are challenges, such as the rule of law. It also criticizes the implementation of the bitcoin as legal tender. Likewise, the State Department lamented that many of these measures are slow. "The Bukele administration continues to make efforts to attract foreign investment. However, the implementation of reforms has been slow," the report stated. The document recognizes that El Salvador is attractive for investment and that the international economic situation and the deterioration of the country's rule of law are present challenges.
However, it highlighted that the country is betting on large infrastructure projects that could attract U.S. investment, creating a Secretariat of Trade and Investment, a Presidential Commissioner to formulate trade and investment policies, an Economic Cabinet, and a Presidential Commission for Strategic Projects. "El Salvador has several laws that promote and protect investments, in addition to providing benefits to local and foreign investors," said the State Department.

Source: El Mundo

 september 09, 2022

The Central American Institute for Fiscal Studies (ICEFI) recommended that the Bitcoin Law be repealed one year after it entered into force. "After one year of the law, some of the warned risks have become a reality," published the ICEFI in a statement. The Institute highlighted that having used public resources to impose the mandatory use of bitcoin implies that regardless of whether the population uses it or not, tax revenues are being used to cover the costs of this measure.

Based on what President Nayib Bukele has published on his Twitter, and considering the market price of the amounts mentioned in those messages and the current market price, the loss in the store-of-value can be estimated at more than USD 60 million, according to Icefi estimates. "This cost is high and onerous for the Salvadoran population and taxpayers," the ICEFI states in the communiqué. Additionally, adopting the bitcoin added to the institutional deterioration and has made it difficult for the government to access sources to finance the fiscal deficit, such as the agreement under negotiation with the International Monetary Fund (IMF).

Source: Diario El Mundo

 september 09, 2022

One year after El Salvador approved the Bitcoin Law, the price of the bitcoin in the market has fallen by about 63%. In the first days after the law entered into force, the price of the bitcoin in the market began to show signs of collapse when it went from being worth USD 52,800 to around USD 43,000. After months of uncertainty, the so-called "crypto winter" began, which has been due to the plummeting valuation of cryptocurrencies in the market. The price of the bitcoin in the market currently stands at USD 19,200, representing a reduction of around USD 36,600 since the Bitcoin Law entered into force. In this context, different analysts and experts have indicated that the valuation of the bitcoin in the market will tend to fall to USD 10,000.

Meanwhile, the President of El Salvador, Nayib Bukele, announced earlier this year the creation of a project called "Bitcoin City," which aimed to promote the use of cryptocurrency in the country and attract foreign investment to El Salvador. Additionally, Salvadoran government officials announced the creation of a Bitcoin Bond to seek financing in international markets due to the government's lack of external funding. However, it is noteworthy that, to date, neither of the two announcements or projects have been carried out.

Source: El Salvador

 september 08, 2022

According to a statement issued by the Development Bank of Latin America (CAF), it appointed Óscar Alejandro Avalle as its representative in El Salvador. Avalle, an Argentinean national, is a career diplomat who has also served at the World Bank as the representative for El Salvador and Costa Rica; as the manager for the Corporate Secretariat in Washington; as the country manager in Guatemala; as the country manager in Bolivia; the special representative of the World Bank to the United Nations in New York and Geneva; among other positions.

El Salvador became a full member of the CAF in March this year during the entity's 20th Extraordinary Assembly of Shareholders. The country's Legislative Assembly approved the measure in early 2022. In December 2021, El Salvador ratified its intention to become a member country of CAF by signing an agreement and subscribing to Series "B" nominative shares corresponding to the CAF's ordinary capital. The value of these shares is USD 14,200. In total, the country will subscribe to 32,397 shares over seven years.

Source: La Prensa Gráfica

 september 08, 2022

Last June 2021, the President of El Salvador, Nayib Bukele, announced that El Salvador would become the first country in the world to accept bitcoin as legal tender. After his announcement, the government approved the Bitcoin Law through the Legislative Assembly without public consultations or consulting with Salvadoran associations of economists. The Bitcoin Law established that the Salvadoran State would facilitate the free convertibility of the cryptocurrency to the dollar. It also informed that the country's commerce was obligated to receive payments in bitcoins as legal currency. A couple of months after the law's approval, social discontent became evident in the country, leading to protests and marches against the law. 

Thus, over the months, it has been observed how the use of bitcoin as a legal currency in El Salvador has been surrounded by a reduction in demand, little transparency, and State measures to promote its adoption; while the volatility of the cryptocurrency in the market has exposed the vulnerability of the bitcoin in the global economy. In this context, international institutions such as the International Monetary Fund (IMF) warned about the use of bitcoin as legal tender in the country, which affected the country's negotiations with the entity and caused uncertainty in the international market regarding El Salvador.

Source: El Mundo

 september 07, 2022

Salvadoran deputies have spoken out and have shown their desire to implement a General State Budget (PGE) 2023 with greater transparency and commitment to execute the funds designated in the budget. In this regard, Congresswoman Claudia Ortiz said, "We expect it to be a realistic budget, with real economic growth prospects that the country has, not fostering higher expectations, to generate expectations of higher levels of collection and thus budget more, and then have to resort to debt to balance the budget." Likewise, Congressman Mauricio Linares affirmed that the Salvadoran government must commit to executing the PGE and highlighted the poor implementation of the 2022 budget in social areas. Congressman Numan Salgado remarked that the execution of the 2022 budget had been affected by the world crisis derived from the war between Russia and Ukraine. In this context, Salgado emphasized, "We have used resources to cover subsidies so that the population is not hit;" He also highlighted the government's commitment to continue developing the Salvadoran economy.

Meanwhile, the candidates to be the head of the Human Rights Ombudsman's Office (PDDH) showed their support for the state of emergency regime in the country.

Sources: La Prensa Gráfica, La Prensa Gráfica

 september 07, 2022

Electric power prices have not changed in the country since January. In this regard, the President of the Lempa River Hydroelectric Executive Commission (CEL), Daniel Álvarez, reported that the rate would remain stable until President Nayib Bukele had determined to lift the anti-inflationary measures decreed in March. Álvarez expressed during a television interview that due to the variation in the tariff schedule corresponding to October, which is carried out by law every four months, the CEL is already working on a maneuver to maintain the price-setting policy.

"The entire electricity sector collaborated so that the rate could remain stable, and from January to date, the cost per megawatt for the population remains the same," said the official. In this sense, he highlighted that the strategy established by President Bukele, given the international increase in hydrocarbon prices, prevented the impact on the population's pocket and increased work for energy generation through renewable sources." We began to use renewable energy and the strength that the State's institutions have to be able to generate electricity that is less expensive than it would be with petroleum derivatives," he said. Meanwhile, Álvarez rejected the proposal recently presented to the Legislative Assembly by ARENA's deputy, René Portillo Cuadra, so that the funds directed to the electricity subsidy be transferred to the private companies in charge of distribution.

Source: Diario El Salvador, Tendencias SV

 september 06, 2022

The Salvadoran Banking Association (Abansa) reported that loans to Salvadoran companies increased by 14.4% in the first half of 2022. In this sense, the association pointed out that in the first semester of the year, the growth rate for credits in the business sector was the highest in the last 14 years, while credits for individuals grew by 5.7%, and housing credit increased by 3.1%. In detail, the institution pointed out that the balance in credit for companies totaled USD 7,480 million, while in the same period of 2021, USD 6,540 million was reported. Thus, the sectors that requested more credit in the first half of the year were trade and electricity, with loans of USD 262 million and USD 236 million, respectively.  
Meanwhile, the sectors that borrowed the most were industry, finance, services, construction, and mining and quarrying, while loans to transportation and agriculture decreased. In this context, the association highlighted the growth rate of credit in the country and stated that "the balance of loans has increased at historical rates, compared to previous years, supported by growth in the corporate segment."

Source: El Mundo

 september 06, 2022

One year after the Bitcoin Law entered into force in El Salvador, the opacity of the government has not allowed its citizens to know the details regarding the processes followed to disburse millions of dollars of public funds in its implementation, and entities such as the Development Bank of El Salvador (Bandesal) have contributed to keeping this information secret. In this regard, there is no official data on the economic benefits for Salvadorans with the adoption of this crypto active in the country; no statistics indicate that businesses have flourished from using the virtual currency.
Meanwhile, the Bitcoin Law does not clarify what the country faced with the bitcoin experiment since, with just 16 articles, it does not make clear many of the aspects that Salvadorans currently still do not understand, which generates disinterest in its citizens.
So far, and according to calculations that may be made from the few official announcements and Bukele's tweets, the government has already spent more than USD 480 million in the implementation of the crypto active, which includes some USD 120 million for bonuses of USD 30 that they delivered through the Chivo Wallet platform; USD 107.1 million in the alleged purchase of up to 2,381 bitcoins; and a trust of USD 150 million, whose details of how it is administered are not known.

Source: El Salvador

 september 05, 2022

The Central Reserve Bank (BCR) indicated, according to the Volume Index of Economic Activity (IVAE), that the country's economic activity decreased by 1.09% between May and June 2022 due to the reduction in domestic trade and national construction. The IVAE's data indicated that between May and June, the most affected sector of the Salvadoran economy was commerce, with a reduction of 3.6% in its economic activity, which went from 124.88 percentage points to 122.59 points. In this sense, the Salvadoran economist of the Central American Institute of Fiscal Studies (ICEFI), Ricardo Castaneda, affirmed that the reduction of the IVAE shows that the Salvadoran economy is experiencing a deceleration; in addition, he pointed out that the decrease in commerce in the country is due to a reduction of the income and remittances that Salvadorans receive from abroad. Castaneda said, "It is important to point out that El Salvador is an economy that depends a lot on its trade, and it is one of the activities that have grown the least if compared to the previous month."

Meanwhile, the Economic Commission for Latin America and the Caribbean (ECLAC) recently reduced El Salvador's growth prospects for 2022 from 3.5% to an estimated growth rate of 2.5%

Source: El Diario

 september 05, 2022

In August, Salvadoran bond yields in the market improved due to the government's announcement that it would repurchase bonds maturing in 2023 and 2025. likewise, the news that Deutsche Bank would be the financial entity in charge of carrying out the operation positively affected market expectations. The country's Minister of Finance, Alejandro Zelaya, assured that El Salvador has around USD 560 million available to repurchase the bonds in the transactions announced on August 26th by the Salvadoran government. These funds come from the Special Drawing Rights (SDR) granted by the International Monetary Fund (IMF) and a loan from the Central American Bank for Economic Integration (CABEI).

At the end of August, the Emerging Markets Bond Index (EMBI), which measures country risk, indicated that El Salvador's country risk fell by two percentage points and closed the month at 23.11%. Despite the improvement in El Salvador's country risk, the country continues to be one of the countries with the highest default risk in Latin America, below Venezuela and Argentina. In this regard, different rating agencies have warned about the uncertainty surrounding Salvadoran bonds.

Source: La Prensa Gráfica

 september 02, 2022

El Salvador's Minister of Finance, Alejandro Zelaya, said that they expect the operation to repurchase the 2023 and 2025 bonds to be successful when it goes to the market. "But I think we are going to have a successful operation and that we will have excellent news for all Salvadorans soon," said the official. The government of El Salvador informed of the early purchase of the 2023 and 2025 bonds on July 26th to avoid default and cancel its commitments. The closest to maturity will be the payment of USD 800 million due in January 2023. 
Meanwhile, Zelaya said that the announcement affected bond prices, and they expect that the trend will continue to rise. Also, the deadline for the repurchase of the bonds was announced as September 15th, which will save USD 150 million. In addition, the Minister stated that they would reveal how negotiations are progressing in due time since market rules require a period of silence and reiterated the country's commitment to pay its obligations. The government must pay USD 1,600 million in the next two years, which is part of the more than USD 7,000 million in Eurobonds owed in foreign debt for the next 30 years. El Salvador must not only seek to pay off the external debt but also USD 1.2 billion more for the payment of the internal debt in 2022.

Source: El Mundo

 september 02 , 2022

After a year of the entry into force of the Bitcoin Law in El Salvador, the economist and former President of the Central Reserve Bank, Carlos Acevedo, said that the implementation of the bitcoin as legal tender in the country has not been successful. In this sense, Acevedo said that the Salvadoran government failed to meet its objectives by implementing the law, such as promoting financial inclusion in the country and reducing the costs of remittances. Thus, the former President of the BCR said, "the benefits to date are not very clear to me. If we examine the two main objectives that the President said were going to be achieved, such as remittances, they have not been achieved. And the other objective of financial inclusion has not been achieved either. The poor suffer most from a lack of access to financial services. So, the first two objectives have not been achieved, and the issuance of bitcoin bonds has not worked, and I do not think it will work".
Meanwhile, Acevedo pointed out that implementing the Bitcoin Law in the country affected the Salvadoran government's negotiations with the International Monetary Fund (IMF); furthermore, he indicated that the law affects El Salvador's country risk level.

Source: La Prensa Grafica

 september 01, 2022

According to La Prensa Gráfica, the government announced that Deutsche Bank will be the bank responsible for carrying out the repurchase operations of the bonds that the Salvadoran government will carry out in September. After the announcement, it was possible to observe how the sovereign bonds registered increases in their prices. In detail, the bond that had the most increase was the maturity to 2025 with an increase of 4.6%; meanwhile, the bond maturing in 2023 rose about 1.16%. However, sources indicated that Salvadoran bonds are accompanied by uncertainty and indicated that "Bondholders are waiting for more details and uncertainty persists about whether the repurchase will materialize, since the government has not complied with several announced measures."
For his part, Finance Minister Alejandro Zelaya announced in previous days that the Salvadoran government has available for the repurchase of the bonds around USD 560 million. If the bonds were paid off by the maturity date, the government would require about $1.6 billion. In this context, different Salvadoran economists have described the announcement of the buyback as a media strategy. 

Source: La Prensa Grafica

 september 01, 2022

According to the latest report of the Consumer Price Index (CPI) of the General Directorate of Statistics and Censuses (DIGESTYC), food and non-alcoholic beverages are the goods that have risen the most in value. Among the 12 goods and services that make up the CPI, food and non-alcoholic beverages reported an increase of 14.2% per year last July. According to the executive director of the Center for Consumer Defense (CDC), Danilo Pérez, one of the main reasons for the increase in prices is because El Salvador is a mostly importing country. "The country depends on the import of vegetables by 93%," said Pérez. 
As Guatemala and Honduras are the main countries from which the country imports these food products, it is necessary to consider their inflation. "At the end of July, Guatemala had a cumulative inflation of 8.4% and Honduras of 10.9%. So, the phenomenon of why we have high prices, undoubtedly has repercussions on the inflationary issue," Pérez explained. Another element that drives up prices is the war between Russia and Ukraine, which is directly affecting the supply chain. Although the global index prepared by the Food and Agriculture Organization of the United Nations (FAO) on a global scale on food products has begun to report declines, they are not enough to demonstrate this trend, so the prices of raw materials remain high.

Source: La Prensa Grafica

 August 31, 2022

A recent publication of the portal, Criptonoticias.com, highlighted the complaints of Salvadorans regarding the Chivo platform, developed by the government to support the implementation of bitcoin in the country. It also pointed out that citizens have more confidence in traditional banks than in the Chivo Wallet, contradicting the philosophy of the crypto community that prefers decentralized systems. The Chivo platform has been highly questioned from day one due to the number of technical flaws and vulnerabilities it showed, with hundreds of people reporting the losses of funds or identity theft. In addition, the article mentions that the technical support area of the company, Chivo, has still not solved 100% of the cases reported by Salvadorans. Meanwhile, the U.S. National Bureau of Economic Research, in association with Cid Gallup, conducted a survey that showed that only 20% of Salvadorans continue to use the Chivo Wallet. Part of the reasons respondents offered was that they "did not trust the system or bitcoin itself." In addition, data from the Central Reserve Bank (BCR, reflects the low use of wallets such as the Chivo Wallet to make bitcoin transfers. Meanwhile, the boom of the Transfer365 system for dollar transactions bet