The Paraguayan Road Chamber (Cavialpa) issued a statement insisting on the implementation of the factoring system – or assignment of rights over state debt – as a way to receive pending obligations. The sector expects the regulation to be presented within one or two weeks, as announced by the Ministry of Economy and Finance (MEF).
According to the chamber, government delays force construction companies to resort to private financing to maintain the payment chain and continue works. Cavialpa also expressed concern about the amount committed for payment between April and May, only US$ 150 million.
“Although the payment schedule announced for April and May is being met, the disbursements cover only the new work certificates generated each month and still do not significantly reduce the accumulated debt,” the text says. Cavialpa's president, Paul Sarubbi, detailed that only part of the payment serves to amortize the debt, while new US$ 100 million in debts continue to be generated.
Sarubbi emphasized that the sector does not agree that the cost of factoring be passed on to supplier companies, arguing that it should be covered by the state. He recalled that, in addition to the MEF, the regulation involves legal advisors from construction chambers, representatives of private banking, the Treasury Attorney's Office, and the Central Bank of Paraguay (BCP).
Finally, he reiterated the need to review the fiscal deficit ceiling, otherwise it will be difficult to resolve the debt problem.