Characteristics of RS Debt Intralimits and extralimits 1- Intralimite: There are contracts limited to 13% of RLR. It has revenue guarantees. 2- Extralimite: It can be over the 13% of RLR. It is a focus of new operations.
Debt Restructuring 2008 Smoothing the debt service profile
Service convergence to Senate limit 11,5% of NCR Stock convergence to Senate limit
Current debt management strategy Change extralimits debt with interest high for others with lower cost : ProRural – Currencys floating 8,3% changed to a fix 2,7% interest rate (done) INSS – to strech out (done) Analizing to fix interest rates To adhere in an Emergency Program against crisis of Federal Government (94 million reais - BNDES) To renegociate 1997 agreement in two ways Reviewing interest rate Changing inflation correction
2009 Borrowing strategy Mix of opportunities with macroeconomic scenary analysis We are looking for a progressive increase of fiscal balances a)Containment of expenses and enhance tax efficiency b)Continues with primary surplus in order to pay anual service debt Backgroud Analysis Economic growth around Zero in 2009 Monetary correction ( deflation in some months) SELIC – National interest rate around 8,75% Incomes under the budget,but equal to 2008. Libor extremely low
Decision making process Internal In the Strategic Plan of Finance Secretary we present actions and plans to achieve our goals, specially fiscal balance COGEFIN – Comission of States Treasury All states have seat in a board that elaborates studies to update the conditions for Regionals Debt. Debt Office Study Debt Office Study Treasury Suggest Treasury Suggest Finance Secretary Approval Finance Secretary Approval Governor Approval Governor Approval Deputy Assembly Discuss and Authorize Deputy Assembly Discuss and Authorize
Accountability framework We still don’t have a public document We have: Reports to National Treasury Internal reports about World Bank operation 2008 Trimestral reports about opportunities We are working into: Middle office Section ( already using analytica) Anual report (march/2010) Many courses about debt management We are detecting passive contingent and working on it Jorge Luis Tonetto Jorge.email@example.com