El Salvador President Applauds Huge Congress Election Victory, Bonds Leap

SAN SALVADOR (Reuters) – El Salvador’s President Nayib Bukele declared a significant victory within the legislative elections, citing a projection that his celebration and allies had received the biggest congressional majority within the nation’s historical past.

FILE PHOTO: President of Salvador Nayib Bukele, accompanied by his spouse Gabriela de Bukele, reveals his finger after voting within the municipal and parliamentary elections in San Salvador, El Salvador on February 28, 2021. REUTERS / Jose Cabezas / File Picture

“Historic! Thanks Salvadorians. Thank God,” Bukele stated late Monday night time, tweeting a graphic that projected his celebration and ally, GANA, would win 61 of 84 seats in Congress.

A preliminary tally by election officers confirmed that Bukele’s New Concepts Celebration and its allies received round 70% of the vote, however the distribution of seats won’t be identified till a last tally that can take a number of days.

Bukele, 39, is likely one of the youngest leaders on the planet. He received a landslide victory in 2019 over the pledge to root out corruption, however has been criticized by rights teams and international powers for what they see as his autocratic tendencies.

With this overwhelming victory, the New Concepts Celebration may have an ideal capability to elect an legal professional normal and Supreme Court docket justices, and to approve budgets and constitutional reforms within the Central American nation.

El Salvador’s US greenback sovereign bonds surged after Bukele’s announcement, with many points buying and selling at their highest stage in a 12 months.

Fitch Scores stated victory within the parliamentary elections ended the political stalemate that had hampered coverage implementation and hampered the nation’s means to faucet exterior funding. Nevertheless, it was not clear whether or not the robust majority would result in swift new insurance policies to assist public funds.

The nation faces the amortization of round $ 328 million in Letes, or treasury payments, in March, analysts stated.

An Worldwide Financial Fund (IMF) lending program could be conditional on the federal government’s dedication to fiscal adjustment, Fitch added.

“Bukele has not but outlined a medium-term fiscal technique,” the company stated in an announcement. “Weak financial progress was already weighing on debt dynamics earlier than the pandemic and, coupled with the influence of COVID-19, is creating political strain for extra expansionary insurance policies to cut back poverty and increase employment.”

The company additionally warned that the brand new enhance in energy of the ruling celebration might “weaken the institutional checks and balances”.

El Salvador is anticipated to expertise a decline in financial progress subsequent 12 months to 2.5%, after an anticipated rebound of 5% in 2021, Fitch stated.

Report by Nelson Renteria in San Salvador; Written by Cassandra Garrison; Edited by Paul Simao and Matthew Lewis

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