February 1, 2001
Late last year, when Uruguay went looking for a loan, instead of going to the US or Europe the sovereign looked to Chile. And when it issued a $142.5 million, inflation-linked bond denominated in Chilean pesos, Uruguay became the first Latin borrower to issue an intra-regional bond.
The November deal enabled Uruguay to diversify its funding base and reach an entirely new investor. Uruguay's Chilean peso deal also represented a step toward developing the local Latin American capital markets. Heinz Rudolph, international financial coordinator at the Chilean Ministry of Finance, says the Uruguayan bond marked an important advance toward "the internationalization of the Chilean peso." The
Never before has a Latin sovereign issued debt denominated in another Latin American currency. Uruguay's highly successful Chilean-peso bond gave it a new investor base and put the region?s local capital markets in the spotlight.