JUN
2024
The funds will be associated to various projects and programs with a direct impact on the environment, social protection, and the development of the country.
Santo Domingo. - The Dominican Government, through the Ministry of Finance, issued green bonds for the first time in its history, an issue that amounted US$750.0 million, achieving a rate of 6.70%, approximately 15 basis points lower than what would have been achieved with other non-thematic instrument with a similar term.
The head of the Ministry of Finance, Jochi Vicente, explained that the resources obtained with this issuance, in addition to implying savings for public finances due to the difference in the cost, will be used for green expenses, eligible under the first Green, Social, and Sustainability Bonds Framework of the country, published last week.
Vicente expressed that the Dominican Republic is one of the most vulnerable countries to the effects of climate change, which is why government investments in projects and programs that contribute to mitigating the phenomenon and its impact on the population and public infrastructures are necessary.
The country's first green bonds received demand from foreign investors in global capital markets, six times higher than the issued amount. This milestone demonstrates confidence in the Government's commitment to environmental protection, social needs, and sustainable development, as well as the solid performance of the Dominican economy.
“Every time we have gone out to the international capital markets, we receive notable support which, among other factors, is a result of the good management we have given to the public debt,” the Minister highlighted.
The Vice Minister of Public Credit, María José Martínez, highlighted that these operations are part of a sustainable issuance program included in the 2024-2028 medium-term debt management strategy that is being executed by the Government. Additionally, they are aligned with the country's goals established in the National Development Strategy 2030.
“The inclusion of thematic bonds in our financing plan, in addition to the environmental and social benefits, is an example of the commitment to transparency in the management of public debt and also diversifies the investor base,” Martínez emphasized.
Likewise, this operation was complemented with a repurchase of US$1,009.0 million of external bonds with maturity in 2025. For this repurchase and to cover part of the financing needs of the General Government Budget for 2024, RD$105,000.0 million of external bonds were issued in local currency amortizing in 2036 and US$500.0 million of a reopening with maturity in 2031.
This has an important effect on the debt portfolio of the non-financial public sector, because it represents a decrease in the percentage of debt in foreign currency and an increase in the average maturity time of the global bond portfolio.
