El Salvador buys back sovereign bonds to reduce debt
El Salvador has repurchased $74 million worth of its sovereign bonds maturing in 2023 and 2025.
The Republic of El Salvador has announced that it has completed the second repurchase of its sovereign bonds maturing in 2023 and 2025.
According to a press release shared by President Nayib Bukele, the country purchased $74 million worth of government bonds on Dec. 8.
In September, the government bought back around $565 million worth of bonds.
The debt was issued by El Salvador’s previous administrations in 1999 and 2004, with the 2023 and 2025 bond offerings being worth $800 million each, ABC reported.
President Bukele celebrated the accomplishment on Twitter, saying that the debt repurchase has generated more than $288 million in savings from interest payments for the country.
El Salvador has completed the second repurchase of its sovereign bonds maturing in 2023 and 2025; acquiring in both operations bonds for more than $647 million ($74 million in this operation).
Generating more than $288 million in savings for our country 🇸🇻https://t.co/NoVtotHnet
— Nayib Bukele (@nayibbukele) December 8, 2022
The bond repurchase program managed to reduce the broader market concern about El Salvador’s solvency. Since it introduced Bitcoin as legal tender in September 2021, the IMF and the World Bank have both warned the country about the repercussions of its bold decision.
With the government of El Salvador heavily invested in Bitcoin, its plummeting value led many to question the country’s ability to pay back its debt.
However, both the country’s president and its government dismissed the concerns and are reportedly still pursuing plans to issue bonds denominated in Bitcoin.