The government of Cordoba Martin Llaryorawith the endorsement of the Nation, launched a program of issuance of debt securities by $120 billion. It is the most important provincial bet of the president’s era Javier Milei. He antecedent is Mendoza which in March took $77,000 million in securities tied to the Reference Stabilization Coefficient (CER). The efforts before the Nation of the people of Cordoba began in the third month of the year with the objective of sustaining the cash flow in the face of the drop in own collection and also in national transfers through co-participation.
The Minister of Economy of Córdoba, Guillermo Acosta, in March he began the procedures for the authorizations of his counterpart Luis Caputo; At that time, a program of issuing Treasury Bills for up to $150,000 million and a bond for $350,000 million was proposed. They expected the first placement for April; It will finally be now.
The Province faces maturities in dollars for US$488 million in the remainder of the year. In June it must pay US$159.06 million; in July, interests for US$11.54 million and US$15.68 million and, in December, another for US$488 million.
Before leaving power, the former governor Juan Schiaretti He stressed that he left “cash” for his successor, Llaryora: US$932 million. “Córdoba had an operating surplus of US$7,489 million in the last eight years,” he said. And this is what guaranteed us to carry out the largest public works plan in history, for US$ 8,398 million, which we paid for 92% with our own resources and took credit for 8%, because what the Nation put in, “Córdoba’s public works plan is practically insignificant.” In this way he insisted that the Province had the funds to continue paying its debt.
The entire amount was awarded in Class 2 Debt Securities, with a maturity of 36 months and capital adjustment by the CER index. Offers were received for $221,449 million. The funds obtained will be used to finance works planned in the Public Works Plan.
The bidding was carried out in two classes, Class 1 and Class 2 Debt Securities, for a total amount of $80,000 million. During the bidding round, orders were received for more than $220,000 million between the two classes offered. Due to the very good conditions achieved, the Province decided to make use of the possibility of expanding the issuance up to $120,000 million.
The entire amount was awarded in Class 2 Debt Securities, which have a term of 36 months and the capital is adjusted by the CER index. These securities bear a rate of 450 basis points, a coupon that was tendered during the negotiation and was very favorable, which is why it was chosen to concentrate the issuance on them.
Interest will be paid semiannually and the capital will be amortized in two installments, the first for 25% in the 30th month and the remaining 75% at maturity.
Until now, except in the case of Mendoza, the placements of provinces were limited to those of letters Chaco and Buenos AiresThey have been doing them every month since January but in amounts that do not exceed – the largest, from Axel Kiciloff’s administration – $100,000 million.
Automatic transfers from the Nation to the provinces fell 20.6% in real terms in April and have accumulated a real decrease of 19.2% in the first four months. To this we must add that non-automatic transfers fell 89.5% in the first four months of the year to all provinces and municipalities, totaling $108,997 million. Córdoba went from $14,082 in the same period of 2023 to $3,702 million in the current period.
During the first quarter of last year, that amount had reached $295.92 billion, according to the monthly analysis of the Congressional Budget Office. This data includes only the discretionary transfers by the central government, although the tax resources of the co-participation also show strong decreases, which determines that the accounts of the different jurisdictions are under double control. On the one hand, they have less income given the deep cut that the national administration applied in terms of direct financial assistance to the provinces and, on the other, due to the decrease in the collection of taxes that are distributed between the Nation and the provinces. Collection has been falling in real terms but, at the national level, income from withholdings and, above all, the PAIS tax, moderate the lack of funds for national public accounts.
