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S&P cuts Jujuy
S&P said it lowered the Argentine province of Jujuy’s issuer rating to CC from CCC-.
“Our CC ratings on Jujuy reflect our view of a virtual certainty of default, either through a distressed debt exchange or a missed payment,” S&P said in a press release.
Almost 25% of its debt consists of the $210 million 2022 bond, proceeds from which the province used to build the Cauchari solar farm. The project is operational, and Jujuy estimates the farm will generate $60 million in revenue annually. Interest payments on this bond will total $18 million in 2021. “Nonetheless, the project’s start of operations was delayed for a year, which along with the province’s weak budgetary performance compromises Jujuy’s capacity to build sufficient cash to serve the bond’s bullet amortization in 2022,” the agency said.
The outlook is negative.
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