ORANJESTAD (AAN) – The Government of Aruba has secured a USD 160 million loan on the international capital market, achieving a historically low country risk rating. Minister of Finance Geoffrey Wever announced that the successful transaction will be used to refinance government debts maturing this year.
The offer from professional investors significantly exceeded the amount needed, totaling over USD 1 billion from 39 American and European financial institutions. This figure represents seven times the required financing. The 10-year loan was organized by Citigroup Global Markets. For the first time, investors offered funds at a country risk premium of less than 2%, a decrease from the previous range of 2.5% to 3.5%. The loan’s coupon rate was set at 6.29%, which authorities attributed to current international geopolitical turbulence.
Minister Wever clarified that this arrangement does not increase the island’s overall debt level or interest expenses. “The debt level does not rise. Nor the interest expense. This is not a new debt, but a new arrangement for past debts expiring this year,” Wever stated. He highlighted that while the budget surplus allows for partial repayment of maturing debts, refinancing is necessary for the remainder.
The three major rating agencies have recognized Aruba as a quality financial product.
