STATE BONDS OF THE ECUADORIAN GOVERNMENT IN THE ECUADORIAN BUSINESS ECONOMY

Review article

Abstract

When a country has a deficit in its economy, it is necessary to resort to financing from other sources. The issuance of bonds is a source of financing to raise money with which it is intended to safeguard the economic well-being of the population, therefore, the issuance of bonds is not an alternative but a necessity. The objective of this research is to analyze the issuance of state bonds of the Ecuadorian Government in the last 10 years and their impact on the Ecuadorian business economy. For its development, a literary review was carried out through a bibliographical and documentary search in several sources of specialized consultations in macro and microeconomics, country risk analysis, percentage of indebtedness, magnitude of bonds issued, as well as official websites of government entities. The results allowed to know how these state bonds have influenced the economy of Ecuadorian companies during the last ten years, and how the performance of the aforementioned bonds are influenced by the internal policies of the country, such as the austerity of the State, likewise, the qualifications granted by expert companies, country risk, indebtedness, Gross Domestic Product in other indicators that allow measuring the development of a country in a determined period. In 2018, the largest bond issue was made, which amounted to USD 3,000 million with a 10-year maturity at a rate of 8.87% as a result of a high country risk of 700 points, which allowed the General State Budget to be successfully financed. (PGE) to meet the obligations of the inhabitants and many companies. Consequently, it led to a rise in prices in several productive sectors, leading them to access traditional financing mechanisms such as the Banking Market. It is concluded that these bonds apart from benefiting in education, health, productivity, works, among others, brought disadvantages subject to high interest.

Keywords: State Bonds, Country Risk, Business Economics.