Dominican Republic could use bonds to buy Petrocaribe debt from Goldman Sachs
SD. The purchase of the Dominican debt with Venezuela by the investment bank Goldman Sachs would be part of a triangle, whose last vertex is the Dominican Republic.
According to the English language edition of The Wall Street Journal, Venezuelan officials have talked with Dominican officials and with the Goldman Sachs Group, in order to implement a financial formula which would give a little relief to the “fragile finances” of Venezuela.
According to the version in the United States media, which sites “persons familiar with the affair,” and who it did not identify, Goldman Sachs would acquire the Dominican debt with Venezuela, with a great discount, in order to then sell it to the Dominican Republic, who would pay for it with the funds that it would obtain from a new emission of sovereign bonds.
Nevertheless, somewhat different from what was reported by the El Nuevo Herald, last Monday, the source at the WSJ said that they still “have not reached an agreement,” so that it “was not imminent.”
While these versions were circulating in the United States newspapers, in the Dominican Republic the Dominican authorities remained silent. On Tuesday, after the Diario Libre requested a statement from the Minister of Hacienda, Simón Lizardo, a request reiterated on Wednesday, the only known reaction from the official is that “he has not been informed.”
The same silence is being kept by the Venezuelan Embassy in the Dominican Republic where they did not answer the request for a clarification made by the Diario Libre.
The Nuevo Herald published on Monday night that the government of Nicolas Maduro sold the Dominican debt from Petrocaribe (some US $4.3 billion, as of October 2014) for which the investment bank would pay 41% of the total amount.
This Wednesday, the British newspaper The Financial Times (FT) also reported on this issue, in a blog by John Paul Rathbone and Andres Schipani, where it is estimated that the coupon of US $1.7 million which Goldman Sachs would obtain will be at an interest rate of 11%.
The Financial Times analysts mentioned a report by Bank of America, where it is calculated what the fall in petroleum prices means for Venezuela which has to find US $25 billion of fresh foreign financing per year in order to maintain its imports.
Nevertheless, even selling all of the Petrocaribe debt, including that of Cuba, Nicaragua, Jamaica, they would only receive some US $6 billion.
Category: DR News |