Jacinto Peynado suggests in an article in Listin Diario the government could gain the same benefits, such as improving the country’s risk rating, by issuing a manageable US$100 million in bonds for starters. The PRSC opposition leader criticizes the issuing of US$500 million bonds. He said that would represent 15% of the total accumulated public debt of the past 40 years. He claims it will cost the country US$75 million in interest, and then the government will have to come up with the US$500 million or continue to issue another bond to pay for this vicious circle of buying and borrowing. Peynado commented that the sovereign bonds are a valid instrument for modern public finance management. But he said, “It should not be a gigantic issue to cover a budgetary deficit in a particular year and the lack of foresight of the tax reform planners.”
