Country saw first dollar-denominated debt sale in 20 years
Bourse’s president says more issuers are lining up to sell
Venezuela’s unofficial transformation into a dollarized economy is breathing new life into the country’s financial markets.
The president of the Caracas Stock Exchange says several private companies are lining up to sell hard-currency debt in the wake of the country’s first dollar-denominated note issuance in more than 20 years, the $300,000 in commercial paper placed by the rum maker Ron Santa Teresa about a week ago.
“It is a small issuance, but has awakened a lot of interest,” said Gustavo Pulido, who has been the bourse’s top executive since 2017. He expects two similar sales by the end of the year and more to come. “This is going to be the first of many.”
But as President Nicolas Maduro loosens restrictions on using dollars, essentially conceding that the bolivar is now worthless, areas of the economy that aren’t completely controlled by the government are showing new signs of life, including financial markets.
The exchange has only about 60,000 traders, but the average number of transactions has more than tripled this year. The 64-year-old Pulido, who before joining the exchange had founded his own brokerage, says there’s a huge need for financing while potential creditors have about $2 billion stuck in Venezuela that could be used to provide funding.
“You can’t grow in bolivars,” he said. “We need a multi-currency stock market.”