TCRLA_Public/150618.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

                     L A T I N   A M E R I C A

            Thursday, June 18, 2015, Vol. 16, No. 119



METROGAS S.A.: S&P Affirms 'CCC-' Currency Rating; Outlook Neg.


BRAZIL: Retail Sales Unexpectedly Fall Amid Weak Confidence
ECO SECURITIZADORA: Moody's Rates 68th Series Certs at Ba2
GENERAL MOTORS: Temporarily Halts All Auto Production in Brazil
TONON BIOENERGIA: S&P Keeps CC Rating on Watch Neg. After Payment
TUPY SA: Fitch Affirms 'BB' LT Foreign Currency IDR

C A Y M A N  I S L A N D S

BLACKSTONE SEN: Commences Liquidation Proceedings
CORPORATE PARTNERS II: Commences Liquidation Proceedings
GPB-DI HOLDINGS: Placed Under Voluntary Wind-Up
IGUANA LIMITED: Creditors' Proofs of Debt Due July 3
LIONGATE RECOVERY: Creditors' Proofs of Debt Due June 29

MILLBROOK INTERNATIONAL: Creditors' Proofs of Debt Due July 8
MSGP LIMITED: Placed Under Voluntary Wind-Up
RAM RATIONAL: Creditors' Proofs of Debt Due July 8
SFJ PHARMA: Creditors' Proofs of Debt Due June 30
TRIPARTITE HOLDINGS: Creditors' Proofs of Debt Due June 29


* ECUADOR: Correa's Back-Track on Tax Bills Fails to Halt Protests


JAMAICA: IMF to Disburse SDR28.32MM Following Performance Review
JAMAICA: Public Debt Increases, Nominally
* JAMAICA: Still Intends to Establish IFS Center, Hylton Says


PARAGUAY: S&P Affirms 'BB/B' Sov. Credit Ratings; Outlook Now Pos.


AES PANAMA: Fitch Rates USD375MM Sr. Unsecured Notes 'BB+(EXP)'


INKIA ENERGY: Fitch Affirms 'BB' Issuer Default Ratings

                            - - - - -


METROGAS S.A.: S&P Affirms 'CCC-' Currency Rating; Outlook Neg.
Standard & Poor's Ratings Services affirmed its 'CCC-' local and
foreign currency ratings on Metrogas S.A.  The outlook remains

S&P's 'CCC-' ratings on Metrogas reflect S&P's expectation that
its poor financial performance in the second half 2015 could
hinder the company's ability to continue complying with its
financial obligations in the short term.

The ratings also reflect Argentina's high regulatory risk, the
lack of clear tariff adjustment policy (tariff adjustments are
approved by the executive branch at its discretion), the company's
exposure to foreign exchange risk (because it generates cash in
Argentine pesos, while its debt is denominated in dollars), and
its "weak" liquidity position.  The mitigating factor is Metrogas'
status as the largest natural gas distribution company in the
country, which provides natural gas to more than 2.3 million
customers in the city of Buenos Aires and in the southern cone of
"Greater Buenos Aires," which represent the most densely populated
and highest per capita income area in the country.


BRAZIL: Retail Sales Unexpectedly Fall Amid Weak Confidence
David Biller at Bloomberg News reports that Brazil's retail sales
in April unexpectedly declined as the prospect of recession
undermines confidence in Latin America's largest economy.

Sales dropped 0.4 percent after a revised 1 percent decline in
March, the national statistics agency said in Rio de Janeiro,
according to Bloomberg News.  That was weaker than all but one
estimate from 33 economists surveyed by Bloomberg, whose median
forecast was for a 0.7 percent increase.

Bloomberg News notes that a weaker economy has yet to persuade the
central bank to slow or stop its monetary tightening cycle.  The
combination of above-target inflation that's eating into real
wages, the highest interest rates since 2009, rising joblessness
and depressed sentiment have weighed on sales, Bloomberg News

"It was a negative surprise, but it is not as weird in terms of
the scenario we're living in," Jankiel Santos, chief economist at
BESI Brasil, told Bloomberg by phone from Sao Paulo.  "It's really
widespread, which tends to show me that it's the effect of credit,
income level and consumer confidence.  All of these just going in
the other direction instead of expansion," Mr. Santos added.

Swap rates on the contract due January 2017 fell seven basis
points to 13.99 percent at 10:04 a.m. local time on June 16.  The
real strengthened 0.7 percent to 3.1043 per U.S. dollar, notes the

                             Not Enough

Analysts had expected supermarket sales to have a "tremendous
impact" and, while they increased, it wasn't enough to offset the
other declines, according to Mr. Santos, Bloomberg News relates.

Sales of food, beverages and tobacco at hypermarkets and
supermarkets rose 1.9 percent after a 2.2 percent drop in March,
Bloomberg News says.

Articles for personal and domestic use fell 5.1 percent, while
furniture and appliances dropped 3.1 percent, Bloomberg News

In a bid to stem consumer price increases, central bank directors
led by President Alexandre Tombini have raised the key interest
rate in six straight meetings, to 13.75 percent, Bloomberg News
notes.  That's the highest since January 2009, even as economists
surveyed by the bank estimate the economy will shrink 1.35 percent
this year, Bloomberg News says.

Today's data won't prevent policy makers from maintaining the
half-point pace of tightening at the next monetary policy meeting,
known as Copom, according to Thais Zara, chief economist at
Rosenberg Consultores Associados, Bloomberg News notes.  Twelve-
month inflation is running at 8.47 percent, nearly four percentage
points above the midpoint of the target range, Bloomberg News

                        'Rather Difficult'

"You've already had all this deceleration in sales, but that
hasn't yet been reflected in prices," Mr. Zara said by phone from
Sao Paulo, note the report. "So I don't think that changes the
Copom position."

Retail sales in April fell 3.5 percent from the previous year,
versus a median forecast for a 1.8 percent decline, Bloomberg News
relays.  That follows a revised 0.3 percent gain last month.
The broader retail index, which includes cars and construction
materials, tumbled 8.5 percent from a year ago, versus a median
estimate for a 8 percent drop, Bloomberg News notes.

Family consumption fell in the first quarter more than any of the
other components of Brazil's gross domestic product, reports
Bloomberg News.  The decline signals a "rather difficult" second
quarter as well, according to Rosenberg's Mr. Zara, the report

"Some deceleration in terms of economic activity is what the
central bank wants to see to bring inflation down," BESI's Mr.
Santos said, Bloomberg News notes.  "In Tombini's shoes, he's
looking at that and saying we're reaping the fruits of all the
hikes we've been doing over the past year and a half."

ECO SECURITIZADORA: Moody's Rates 68th Series Certs at Ba2
Moody's America Latina has assigned definitive ratings of Ba2
(global scale, local currency) and (national scale) to the
68th series of the first issuance of agribusiness receivables
certificates ("certificados de recebiveis do agronegocio" or CRA)
issued by Eco Securitizadora de Direitos Creditorios do
Agronegocio S.A. (Eco Agro, not rated) backed by an export credit
note issued by Suzano Papel e Celulose S.A (Suzano).

Issuer: Eco Securitizadora de Direitos Creditorios do Agronegocio

  -- 68th series, 1st issuance -- Ba2 (global scale, local
     currency)/ (national scale)

Eco Agro issued the agricultural receivables certificates, which
backed by an export credit notes ("nota de credito a exportacao"
or NCE) issued by Suzano. The underlying NCE is rated Ba2 on the
global scale and on the national scale. In addition, Suzano
will be obligated to pay for transaction expenses.

Suzano will use the proceeds from issuance exclusively for the
financing of its agribusiness activities, in connection with the
export of pulp and paper. The definitive ratings on the CRA are
based on a number of factors, among them the following:

- The willingness and ability of Suzano (as debtor), rated
   Ba2/, to make payments on the underlying NCE. Suzano is
   therefore ultimately responsible for making timely principal
   and interest payments on the notes backing the CRA.

- Pass through structure; mitigated interest risk: The CRA's
   payment schedule replicates the scheduled cash flow of the
   underlying NCE, with a one-day lag, which allows adequate
   timing to make payments on the CRA. Despite this, the accrual
   periods for the CRA and NCE will match.

- Suzano will pay CRA expenses: Suzano will be responsible,
   under the transaction documents, for all the CRA expenses.

- Segregated assets: The CRA benefit from a fiduciary regime
   ("regime fiduciario") whereby the assets backing each series
   of CRA are segregated. These segregated assets are destined
   exclusively for payments on the CRA as well as certain fees
   and expenses, and will be segregated from all of the other
   assets on the issuer's balance sheet. However, the transaction
   is subject to residual legal risk because Eco Agro's
   agribusiness credits can be affected by the securitization
   company's tax, labor and pension creditors. (For more
   information, see the "Fiduciary Regime and Segregation of
   Assets" section in the New Issue Report.)

The (national scale) and Ba2 (global scale, local currency)
ratings assigned to the CRA are based mainly on the willingness
and ability of Suzano (as debtor) to honor the payments defined in
transaction documents, reflecting the Ba2/ rating of the
underlying NCE backing the transaction. Any change in the ratings
of the NCE could lead to a change in the credit quality, and thus,
the ratings, of the CRA.

The ratings of the NCE that backs the 68th series of CRA, reflect
Suzano's position as a low cost producer of bleached eucalyptus
kraft pulp (BEKP) and paper, with leading stakes the global BEKP
market and Brazilian printing and writing paper and paperboard
sectors. Also, the company has a comfortable liquidity profile,
with cash balance at the end of March 2015 sufficient to cover
short term debt maturities by 1.8 times and our expectations that
leverage and credit metrics will improve in the medium term with
the additional EBITDA stream coming from the 1.5 million tons
hardwood plant in the state of Maranhao, now running at full-
capacity. However, constraining Suzano's corporate ratings are the
volatile nature of the pulp industry, which should represent
around 60-65% of Suzano's revenues onwards and the still high
leverage related mostly to its pulp expansion in the state of
Maranhao. Furthermore, there is still new hardwood projects
ramping up in the next two years in Latin America, which will add
approximately 2.5 million tons of capacity in the market, and
could pressure pulp prices if we see a deceleration in demand. To
the extent the growth in demand from China's paper manufacturers
and pulp capacity shutdown do not materialize, pulp prices could

Eco Securitizadora de Direitos Creditorios do Agronegocio S.A. was
incorporated in 2007 as a securitization company of agribusiness
credit rights and is headquartered in Sao Paulo. The issuer is
part of the Eco Agro Participacoes S.A., Group, which maintains
99.99% of shares in Eco Agro. In addition to Eco Agro, Eco Agro
Participacoes also holds controlling positions in Eco Consultoria
Ltda (company which provides services to Eco Agro) and Eco Gestao
Ltda (company which manages funds). Since the beginning of its
operations, Eco Agro has issued 67 CRA, totaling an issuance
amount of approximately BRL 1.3 billion, with currently
outstanding CRAs totaling BRL 560 million.

Any changes in the rating of the underlying NCE could lead to a
change in the ratings on the CRA.

GENERAL MOTORS: Temporarily Halts All Auto Production in Brazil
Latin America Herald Tribune reports that General Motors has
temporarily suspended all production of motor vehicles in Brazil
with the start of mandatory vacations at two plants.

Workers at the plants in Gravatai, Rio Grande do Sul and Sao Jose
dos Campos went on paid vacation leave on Monday, joining those in
Sao Caetano do Sul, according to Latin America Herald Tribune.

The move was made to "adjust the volume of production to the
market's current demand," which has collapsed as a result of the
economic slowdown and the end of government tax incentives, GM
said in a statement obtained by the news agency.

Sales, as measured by the number of new automobile registrations,
fell 18.2 percent in the first five months of this year, compared
to the same period in 2014, the National Motor Vehicle Dealers
Federation, or Fenabrave, said in a report released earlier this
month, the report notes.

GM did not provide information about the total number of workers
affected by the mandatory vacations, but labor unions estimated
that some 20,000 employees were affected, if those at two engine
plants and a parts factory were taken into account, the report

Other Brazilian automakers have taken similar steps, the report

Brazil's auto industry employed 138,200 workers as of May 31, a 1
percent drop, compared to the previous month, and down 9.2 percent
from the May 2014 level, the report adds.

TONON BIOENERGIA: S&P Keeps CC Rating on Watch Neg. After Payment
Standard & Poor's Ratings Services said that it kept its 'CC'
ratings on Tonon Bioenergia S.A. on CreditWatch negative following
the interest payment on its existing $230 million senior secured
bond (CC/Watch Neg) on the last day of the cure period.  Default
hasn't occurred because the company paid interests during the cure
period.  However, this payment came with a proposed tender offer
for Tonon's existing senior unsecured bond (C/Watch Neg), which
includes changes in the terms and conditions for the payment of
the notes, which S&P may consider as a selective default under its
criteria "Rating Implications Of Exchange Offers And Similar
Restructurings, Update" May 12, 2009.  S&P expects to resolve the
CreditWatch listing until July 13, the due date for bondholders to
review the proposed amendment.

TUPY SA: Fitch Affirms 'BB' LT Foreign Currency IDR
Fitch Ratings has affirmed the ratings for Tupy S.A. (Tupy) as


   -- Long-term foreign currency Issuer Default Ratings (IDRs) at
   -- Long-term local currency IDRs at 'BB';
   -- Long-term national scale rating at 'AA(bra)';

Tupy Overseas S.A.

   -- USD350 million senior notes, guaranteed by Tupy, due in
      2024, at 'BB'.

The Rating Outlook for the corporate ratings is Stable.

The ratings reflect Tupy's capacity to continue generating
adequate operational cash flows even during unfavourable
macroeconomic environments, such as the current depressed
automotive market in Brazil. Tupy has consistently reported
positive free cash flows (FCF) due, in part, to deriving
approximately 73% of its revenues from the external market,
resulting in higher stability in operational cash flows and
margins. In the last 12 months (LTM) ended March 31, 2015, 54% of
Tupy's revenues derived from the NAFTA, 26% from Brazil, 15% from
Europe and 5% from Asia and other markets.

The ratings also incorporate Tupy's conservative capital structure
and comfortable liquidity, as well as its leading position in the
global engine blocks and cylinder heads manufacturing over the
last years. High variable costs and efficient cost management have
provided the company with an important operating flexibility to
rapid adjust production to demand fluctuations of the automotive
sector, allowing it to maintain resilient operating margins
through cycles. In March 2015 (LTM), Tupy's EBITDA margin improved
to 16.7% from 16.2% in 2014 and the average of 14.8% from 2010 to

Tupy's ratings remain constrained by its relatively low scale and
still limited geographic diversification when compared to other
global auto-part companies and by the high cyclicality and
competitive environment of the automotive industry. Also factored
into the ratings, is the challenging scenario in the Brazilian
economy and the domestic auto sector, which are not expected to
improve materially in the near term.

Fitch expects Tupy will continue to preserve a solid capital
structure and adequate liquidity during the challenging
environment in the Brazilian automotive market. The agency
forecasts increasing exposure to the external market and moderate
levels of investment will be key to support Tupy's cash flows
generation in the next two years.


External Market Will Continue to Support Adequate Cash Flows

Fitch believes Tupy will continue to benefit from its increasing
exposure to the external market, particularly the U.S. and Mexico,
to keep reporting consistent cash flow generation. In March 2015
(LTM), Tupy's EBITDA strengthened to BRL517 million from BRL503
million in 2014, despite the 12% drop in sales volumes. Cash flow
from operations (CFFO) of BRL253 million decelerated from BRL300
million in in 2014 and 2013 reflecting a longer cycle of
international revenues and inventory built up, but was still
enough to cope with investments of BRL197 million and dividends of
BRL50 million, resulting in a FCF of BRL7 million. Fitch projects
CFFO and FCF of BRL250 million and BRL50 million in 2015 based on
maintenance of adequate EBITDA level, gradual destocking post a
scheduled stoppage in Tupy's production lines, during July 2015,
and lower capex.

Capital Structure Should Remain Conservative

Tupy's capital structure is conservative and should not change
over the next years. The company has maintained prudent financial
policies, supported by low leverage, high cash in comparison to
short term debt and lengthened debt profile. At the end of March
2015, Tupy's leverage, measured by net adjusted debt to EBITDA,
was 1.9x in comparison to 1.6x in 2014 and 1.5x in 2013. The
slight increase is due to the local currency depreciation on USD
debt and higher working capital requirements as the company
prepares to the maintenance of two production lines. Fitch
forecasts Tupy's net leverage should decline to the same levels of
the last years based on steady destocking throughout the year and
the positive effects of the local currency depreciation not yet
fully captured in the EBITDA.

Fitch believes Tupy will maintain its good financial discipline,
keeping robust cash position over the next years to support the
inherent volatility of the automotive industry. At the end of
March 2015, Tupy's cash of BRL1,427 million was sufficient to
cover debt maturities by 2023. Financial policies are conservative
and establish minimum cash position of BRL700 million and maximum
net leverage of 2x.

Higher Diversification Should Partially Offset Depressed Domestic

Brazilian automotive production and sales dropped by 21% and 19%,
respectively, from January to May 2015 due to weak economic
momentum, with increasing interest rates, persistently high
inflation and low consumer confidence. The end of fiscal
exemptions through reduced taxes for new vehicle acquisition since
the beginning of 2015, has also contributed to worsen vehicle
sales. Fitch believes domestic volumes will remain weak in the
next two years but will be partially offset by Tupy's increasing
exposure to the international market.

Higher geographic footprint following Tupy's acquisitions in
Mexico, in 2012, led to greater exposure to the U.S. and Mexican
automotive markets. The steady recover of European market should
also help Tupy diversify revenues as long as domestic volumes
remain pressured. Longer-term, Fitch believes Tupy will continue
to pursue higher geographic diversification and scale gains
through a combination of organic growth and small and strategic
acquisitions in the high value added heads and blocks markets.

Business Profile Supported by Leading Position in High Added Value

Tupy is currently one of the main suppliers of casted engine
blocks and cylinder heads globally. The company has a market
participation of 43% in Americas and 25% in the Western
hemisphere. Despite the strong competitive position in its main
operating sector, the company has a small to medium scale within
the sector. With net revenues of BRL3.1 billion in March 2015
(LTM) and moderate geographic footprint, considering its high
exposure to the American continent, Tupy has as its main challenge
to compete with larger companies with higher geographic reach

The high customer concentration in a few and strategic global OEMs
(Original Equipment Manufacturers) is partially offset by
longstanding relationships and the fact that Tupy supplies
multiple products in different regions. As OEMs' demands become
more complex and migrate to other regions, Tupy will have the
challenge to keep its competitive position in the sector without
damage its cost structure and margins.


Fitch's key assumptions within its rating case for the issuer

   -- Sales volume declining 13% in 2015 due mainly to depressed
      domestic market;

   -- Gross margin of 18% in 2015;

   -- Longer cash cycle of 80 days in 2015 due to increased
      exposure to the foreign market;

   -- Capex of BRL190 million for 2015 and BRL150 million for


Future developments that may individually or collectively lead to
a negative rating action include:

   -- Relevant deterioration in Tupy's capital structure, leading
      to adjusted net debt/EBITDA above 2.5x with no expectation
      of improvement in the near term;

   -- Weakening in liquidity, with cash/ST debt below 1.5x.

Positive rating actions are unlikely in the medium term due to
Tupy's still moderate scale and geographic diversification and
depressed automotive market in Brazil.

C A Y M A N  I S L A N D S

BLACKSTONE SEN: Commences Liquidation Proceedings
On May 21, 2015, the sole shareholder of Blackstone Sen Offshore
Fund II Ltd. resolved to voluntarily liquidate the company's

Creditors are required to file their proofs of debt to be included
in the company's dividend distribution.

The company's liquidator is:

          Patrick Agemian
          190 Elgin Avenue, George Town
          Grand Cayman KY1-9001
          Cayman Islands
          Telephone: (345) 914 6365

CORPORATE PARTNERS II: Commences Liquidation Proceedings
On May 22, 2015, the sole shareholder of Corporate Partners II
Limited resolved to voluntarily liquidate the company's business.

Creditors are required to file their proofs of debt to be included
in the company's dividend distribution.

The company's liquidators are:

          Ali E. Wambold
          Jonathan H. Kagan
          45 Rockefeller Plaza, Suite 1919
          New York, NY 10111

GPB-DI HOLDINGS: Placed Under Voluntary Wind-Up
At an extraordinary meeting held on May 20, 2015, the sole
shareholder of GPB-DI Holdings (Cayman) Limited resolved to
voluntarily wind up the company's operations.

Creditors are required to file their proofs of debt to be included
in the company's dividend distribution.

The company's liquidator is:

          Constantinos Meivatzis
          Telephone: 0035722749000
          20 Spyrou Kyprianou
          Chapo Central, 3rd Floor
          CY1075, Nicosia

IGUANA LIMITED: Creditors' Proofs of Debt Due July 3
The creditors of Iguana Limited are required to file their proofs
of debt by July 3, 2015, to be included in the company's dividend

The company commenced liquidation proceedings on May 15, 2015.

The company's liquidator is:

          Christopher Tushingham
          Wardour Management Services Limited
          Telephone: (345) 945-3301
          Facsimile: (345) 945-3302
          P.O. Box 10147 Grand Cayman KY1-1002
          Cayman Islands

LIONGATE RECOVERY: Creditors' Proofs of Debt Due June 29
The creditors of Liongate Recovery Fund Ltd are required to file
their proofs of debt by June 29, 2015, to be included in the
company's dividend distribution.

The company commenced liquidation proceedings on May 21, 2015.

The company's liquidator is:

          Mourant Ozannes Cayman Liquidators Limited
          c/o Jo-Anne Maher
          Telephone: (345) 814-9255
          Facsimile: (345) 949-4647
          94 Solaris Avenue, Camana Bay
          P.O. Box 1348 Grand Cayman KY1-1108
          Cayman Islands

MILLBROOK INTERNATIONAL: Creditors' Proofs of Debt Due July 8
The creditors of Millbrook International Fund, Ltd. are required
to file their proofs of debt by July 8, 2015, to be included in
the company's dividend distribution.

The company commenced liquidation proceedings on May 19, 2015.

The company's liquidator is:

          DMS Corporate Services Ltd.
          c/o Nicola Cowan
          Telephone: (345) 946 7665
          Facsimile: (345) 949 2877
          dms House, 2nd Floor
          P.O. Box 1344 Grand Cayman KY1-1108
          Cayman Islands

MSGP LIMITED: Placed Under Voluntary Wind-Up
On May 22, 2015, the shareholders of MSGP Limited resolved to
voluntarily wind up the company's operations.

Creditors are required to file their proofs of debt to be included
in the company's dividend distribution.

The company's liquidator is:

          Trident Liquidators (Cayman) Ltd.
          c/o Lisa Thoppil
          Telephone: (345) 949 0880
          Facsimile: (345) 949 0881
          One Capital Place, 4th Floor
          P.O. Box 847, George Town
          Grand Cayman KY1-1103
          Cayman Islands

RAM RATIONAL: Creditors' Proofs of Debt Due July 8
The creditors of Ram Rational Asset Management (Cayman) Ltd are
required to file their proofs of debt by July 8, 2015, to be
included in the company's dividend distribution.

The company commenced liquidation proceedings on May 18, 2015.

The company's liquidator is:

          DMS Corporate Services Ltd.
          c/o Nicola Cowan
          Telephone: (345) 946 7665
          Facsimile: (345) 949 2877
          dms House, 2nd Floor
          P.O. Box 1344 Grand Cayman KY1-1108
          Cayman Islands

SFJ PHARMA: Creditors' Proofs of Debt Due June 30
The creditors of SFJ Pharma Ltd. are required to file their proofs
of debt by June 30, 2015, to be included in the company's dividend

The company commenced wind-up proceedings on May 18, 2015.

The company's liquidator is:

          Gene Dacosta
          Telephone: (345) 814 7765
          Facsimile: (345) 945 3902
          P.O. Box 2681 Grand Cayman KY1-1111
          Cayman Islands

TRIPARTITE HOLDINGS: Creditors' Proofs of Debt Due June 29
The creditors of Tripartite Holdings Ltd are required to file
their proofs of debt by June 29, 2015, to be included in the
company's dividend distribution.

The company commenced liquidation proceedings on May 19, 2015.

The company's liquidator is:

          Mourant Ozannes Cayman Liquidators Limited
          c/o Jo-Anne Maher
          Telephone: (345) 814-9255
          Facsimile: (345) 949-4647
          94 Solaris Avenue, Camana Bay
          P.O. Box 1348 Grand Cayman KY1-1108
          Cayman Islands


* ECUADOR: Correa's Back-Track on Tax Bills Fails to Halt Protests
Nathan Gill at Bloomberg News reports that Ecuador President
Rafael Correa's attempt to defuse nationwide protests by back-
tracking on two controversial tax proposals failed to prevent
opposition supporters marching for a ninth straight day Tuesday,
June 16.

Protesters gathered in the capital city, Quito, less than 24 hours
after President Correa called for calm and announced he would
delay plans to raise taxes on inheritances and real estate profits
to avoid violence, notes the report.

President Correa "temporarily" withdrew the plans just hours after
saying he wouldn't "cede a millimeter" to protesters' demands,
according to Bloomberg News.  It's probably too little to stop the
protests from growing in the coming days and months as opposition
groups seek to boost support ahead of presidential elections in
early 2017, said Michel Levi, coordinator of the Andean Center of
International Studies at the Universidad Andina in Quito,
Bloomberg News relates.

"I don't think the president's announcement will calm spirits down
completely," Mr. Levi told Bloomberg News in a telephone interview
from Quito.  "Rather, there will be movements that become much
more active as they position themselves for the elections."

Support for President Correa, one of Latin America's most popular
presidents, fell 13 percentage points to 55 percent in June,
according to a report published by Quito-based research
organization Quantum Informe, Bloomberg News says.  The report
didn't give survey details, Bloomberg News adds.


JAMAICA: IMF to Disburse SDR28.32MM Following Performance Review
The Executive Board of the International Monetary Fund (IMF)
completed the eighth review of Jamaica's economic performance
under a program supported by a four-year Extended Fund Facility
(EFF) of SDR 615.38 million (about US$932.3 million at the time of
approval).  The completion of the review enables the disbursement
of SDR 28.32 million (about US$39.8 million).

The four-year EFF arrangement with Jamaica was approved by the
IMF's Executive Board on May 1, 2013.

The Board's decision on the eighth review was taken on a lapse of
time basis.

Jamaica's economic performance under the authorities' economic
program is on track and has remained strong. All performance
criteria for end-March 2015 were met, with the exception of the
central government primary balance criterion, which was narrowly
missed.  Structural reforms have advanced broadly in line with the

Half-way into the authorities' four-year reform program,
investment and growth prospects are gradually improving.  Growth
is projected to approach 2 percent in 2015/16, as the full impact
of lower oil import costs and the recovery from last year's
drought materialize, and as the improved business climate and
confidence feed economic activity.  Lower oil prices have improved
the current account and, combined with prudent monetary policy,
reduced inflation to its lowest point in nearly 50 years.

Continued proactive implementation of the government's growth
strategy will be critical to improve Jamaica's economic growth and
job opportunities.  To foster sustainably lower electricity costs,
scheduled investments in new power plants need to proceed without
delay.  Improving access to credit by small and medium-sized
enterprises will improve financial inclusion and support private
investment.  The recent welcome shift to a more accommodative
monetary policy stance should support the expansion of private
credit and economic growth. Further loosening hinges on the
responses of international capital flows and the inflation trend.
Continued focus on strengthening the regulatory and supervisory
framework of the financial sector remains essential for stability.
Fiscal sustainability relies on fundamental reform to bolster tax
compliance and constrain the growth of current spending.  This
calls for improvements in revenue administration and a sustainable
reduction in the public sector wage bill through fundamental civil
service reform. Improvements in public financial management are
also important to raise the efficiency of public spending.

                          *     *     *

As reported in the Troubled Company Reporter-Latin America on
June 5, 2015, Standard & Poor's Ratings Services raised its long-
term foreign and local currency sovereign credit ratings on
Jamaica to 'B' from 'B-'.  In addition, S&P affirmed the 'B'
short-term ratings on Jamaica.  The outlook on the long-term
ratings is stable.  S&P also raised the transfer and
convertibility assessment to 'B+' from 'B'.

JAMAICA: Public Debt Increases, Nominally
RJR News reports that Jamaica's public debt at the end of April
was J$2.044 trillion, according to information released by the
International Monetary Fund (IMF).  That's up about J$3 billion
from the end of the last fiscal year, and five per cent higher
than a year ago, according to RJR News.

The report notes that despite the nominal increase in the public
debt, however, it is expected, in relative terms, to decline this
fiscal year.

In documents accompanying the release of information by the IMF,
it was pointed out that the debt should reach 133 per cent of GDP
by March next year, the report relays.

At the end of March 2015, the debt burden was equivalent to 137
per cent of GDP, the report says.

                          *     *     *

As reported in the Troubled Company Reporter-Latin America on
June 5, 2015, Standard & Poor's Ratings Services raised its long-
term foreign and local currency sovereign credit ratings on
Jamaica to 'B' from 'B-'.  In addition, S&P affirmed the 'B'
short-term ratings on Jamaica.  The outlook on the long-term
ratings is stable.  S&P also raised the transfer and
convertibility assessment to 'B+' from 'B'.

* JAMAICA: Still Intends to Establish IFS Center, Hylton Says
RJR News reports that the Jamaican Government has asserted that it
still intends to establish an International Financial Services
(IFS) Centre in Jamaica.

Anthony Hylton, Minister of Industry, Investment & Commerce,
projected that the creation of the Center could generate US$300
million in earnings annually, and create ten thousand jobs,
according to RJR New.

The report notes that Mr. Hylton said key pieces of legislation
have been drafted to facilitate the IFS Center.

Promotion of potential opportunities from the development will be
undertaken during the second half of the current fiscal year, the
report notes.

The aim is to establish the country as an offshore financial hub,
similar to jurisdictions such as Bermuda and the British Virgin
Islands, the report says.

But even as Mr. Hylton is making these projections, Aubyn Hill, a
former banker with significant international experience, is
questioning the practicality of establishing an International
Financial Services Centre in Jamaica given recent developments
overseas, the report relays.

Citing Jamaica's proximity to the United States, "the most
efficient and the most dominant financial centre in the world,"
Mr. Hill, in an interview with RJR News, questioned "why Jamaica
would be a port for offshore investment, and especially as well
when the bigger countries -- the United States, the EU,
elsewhere -- are really cracking down on these offshore places,
because they are seeing them as tax havens for many of their big
companies that don't pay taxes in their home countries."

The initiative to establish an International Financial Services
Centre in Jamaica started under the last government of the Jamaica
Labour Party (JLP), which was in office from 2007 to 2011, the
report adds.

Mr. Hill is now an economic policy advisor to the JLP.

                          *     *     *

As reported in the Troubled Company Reporter-Latin America on
June 5, 2015, Standard & Poor's Ratings Services raised its long-
term foreign and local currency sovereign credit ratings on
Jamaica to 'B' from 'B-'.  In addition, S&P affirmed the 'B'
short-term ratings on Jamaica.  The outlook on the long-term
ratings is stable.  S&P also raised the transfer and
convertibility assessment to 'B+' from 'B'.


PARAGUAY: S&P Affirms 'BB/B' Sov. Credit Ratings; Outlook Now Pos.
Standard & Poor's Ratings Services revised its outlook on the
Republic of Paraguay to positive from stable.  At the same time,
S&P affirmed its 'BB/B' long- and short-term foreign and local
currency sovereign credit ratings on Paraguay.  S&P also affirmed
its 'BB+' transfer and convertibility assessment.


The outlook revision to positive reflects Paraguay's increasing
resilience to negative economic trends in the region and looks
head to the successful implementation of ongoing reforms to boost
economic performance.  S&P also expects political stability and
continuity in economic policies over the next three years.

The ratings on Paraguay reflect its sound economic performance,
anchored by prudent macroeconomic policy and strengthening
economic institutions, as well as the steps it is taking to boost
infrastructure.  These factors are balanced by Paraguay's still
developing political institutions that will continue to challenge
the government's ability to implement its agenda.

S&P projects GDP to grow 4%-4.5% in the next three years.
Although the process of diversifying the economy is advancing,
Paraguay's economic performance is still relatively vulnerable to
weather-related risks and commodity price shocks.  Paraguay's
strong external position is likely to moderately weaken in the
next three years as a result of the current account deficits,
after several years of surpluses.  External deficits will be
mainly a result of lower agricultural commodity prices and the
government's investment strategy, which will result in greater
industrial-related imports.  However, S&P expects the country's
external position to remain relatively robust thanks to low
external debt and solid external assets supported by gradual
economic diversification.  Paraguay's still developing political
institutions will likely hold back the full implementation of key
reforms.  President Horacio Cartes' Administration will continue
facing resistance from within its own political party and in
Congress as it advances its reform plans, as well as challenges
related to the weak implementation capacity of key public-sector

Paraguay's economy grew 4.4% in 2014 despite the weakness of its
trading partners and low soya prices, reflecting less volatility
and dependence on the agricultural commodity price cycle.  Despite
a weather-related drop in electricity production, which represents
more than 10% of GDP, resilient economic growth was a result of a
boost in private investment from the construction, livestock,
service, and industrial sectors.  Rising manufacturing
investments, mainly from the fast-growing "maquila" (or
manufacturing) industry--although from a low base--along with the
industrialization of the agricultural production chain, will help
to gradually reduce the economy's still heavy reliance on

Economic weakness in Brazil and Argentina will constrain
Paraguay's re-exports to those countries.  Despite noticeable
advances in economic resilience over the past year, Paraguay has
yet to fully demonstrate a longer track record in withstanding
shocks from external events, in particular those related to its
main trading partners, such as Brazil and Argentina.  Also,
because dollarization remains fairly high (almost 50% of total
credits are denominated in dollars), a significant depreciation in
the guarani coupled with inadequate policy response could raise
risks of deposit outflows and external volatility.

S&P expects real growth of 4.3% in 2015 and 4.5% over the next two
years, although greater infrastructure investment and advances in
structural reforms could provide a material upside to this
forecast.  Still, Paraguay remains a low-middle-income country,
with per capita GDP estimated at $4,461 for 2015.  S&P expects 3%
per capita GDP growth over the next two years.

Paraguay has solid external indicators, which gives the country
flexibility to withstand unexpected external shocks.
International reserves have risen steadily over the past five
years, reaching $7.1 billion at the end of May 2015 from
$6.3 billion in May 2014. Narrow net external debt to current
account receipts has consistently decreased over the past decade,
to -17.2% in 2014 (from 98% in 2002).  S&P expects Paraguay's
narrow net external debt to reach -18.5% of current account
receipts, and gross external financing requirements to reach 14.7%
of usable foreign exchange reserves plus current account receipts
in 2015.  S&P expects external indicators to continue over the
next three years.  Despite government efforts to attract
investments from outside, foreign direct investment has been
modest at about $283 million in 2014 (less than 1% of GDP).

S&P projects that net general government debt will reach 10.8% of
GDP in 2015 and will be 12%-14% of GDP in the next three years, on
average.  Interest payments are likely to consume 2.2% of
government revenues in 2015 and 2.3% on average in the next three
years. In 2013, the government issued its first bond in the
international capital markets--a $500 million 10-year bond (with a
reopening of the original issue in 2015 for an additional $280
million) and another 30-year bond in 2014 for US$1 billion,
totaling $1.780 billion of sovereign bond debt.  It has no
external issuances planned until 2016.

S&P believes that it may be difficult for the government to comply
with Paraguay's Fiscal Responsibility Law's target, as Congress
passed a 2015 budget with spending and deficit numbers that exceed
the law's limits.  S&P also believes that the public-private
partnership (PPP) law might make it more difficult to adhere to
the fiscal deficit of 1.5% of GDP in 2015 and beyond.  To achieve
the target in 2015, the government will have to rein in expenses,
especially given the surge in expenses in late 2014, and contain
the political pressures for more spending in 2016.  S&P expects
moderate progress in increasing the tax collection and improving
compliance.  However, even if fully reaching the Fiscal
Responsibility Law target remains challenging, S&P believes that
the law continues to provide an important anchor for fiscal
prudence over the medium term.

Paraguay has made progress toward adopting an inflation-targeting
monetary policy.  The central bank cut its policy rate by 25 basis
points in its latest meeting (in March), to 6.25%.  S&P expects
that inflation will continue to decline and will reach the target
of 4.5% for 2015.  S&P believes core inflation will remain at 4%.
Nevertheless, high dollarization in the Paraguayan economy still
limits monetary policy flexibility.  Domestic credit in dollars
remains high at about 49%, and about 43% of deposits are in
dollars, as of March 30, 2015.  However, an elevated level of
international reserves sustains confidence in the stability of
Paraguay's currency.


The positive outlook reflects a one-in-three chance that S&P could
raise the ratings in the next one to two years.  For this, gaining
a track record in economic resilience and further
institutionalizing fiscal policy will be important.  Likewise,
reinforcing the country's regulatory and institutional framework
to reduce uncertainties while also strengthening the
implementation capacity of key government agencies to boost public
investment projects could enhance Paraguay's economic prospects
over the next two years.  Continued economic growth and
resilience, as well as better fiscal policy with a proven track
record, could result in an upgrade.

Conversely, S&P would consider revising its rating outlook to
stable if it perceives a weakening commitment to policies that
sustain macroeconomic stability, or an inadequate response to
adverse external developments.  Also, further political
polarization that could block or reverse the government's
structural reform agenda and disrupt economic policy
implementation could result in an outlook revision to stable.  The
resulting decline in investor sentiment and economic growth could
weaken Paraguay's credit profile, leading to a downgrade.

In accordance with S&P's relevant policies and procedures, the
Rating Committee was composed of analysts that are qualified to
vote in the committee, with sufficient experience to convey the
appropriate level of knowledge and understanding of the
methodology applicable.  At the onset of the committee, the chair
confirmed that the information provided to the Rating Committee by
the primary analyst had been distributed in a timely manner and
was sufficient for Committee members to make an informed decision.

After the primary analyst gave opening remarks and explained the
recommendation, the Committee discussed key rating factors and
critical issues in accordance with the relevant criteria.
Qualitative and quantitative risk factors were considered and
discussed, looking at track-record and forecasts.

The committee agreed that the external factor had improved.  All
other key rating factors were unchanged.

The chair ensured every voting member was given the opportunity to
articulate his/her opinion.  The chair or designee reviewed the
draft report to ensure consistency with the Committee decision.
The views and the decision of the rating committee are summarized
in the above rationale and outlook.  The weighting of all rating
factors is described in the methodology used in this rating


Ratings Affirmed; Outlook Action
                                    To                 From
Paraguay (Republic of)
Sovereign Credit Rating            BB/Pos./B      BB/Stable/B

Ratings Affirmed

Paraguay (Republic of)
Transfer & Convertibility Assessment       BB+
Senior Unsecured                           BB


AES PANAMA: Fitch Rates USD375MM Sr. Unsecured Notes 'BB+(EXP)'
Fitch Ratings has assigned a 'BB+(EXP)' rating to AES Panama
S.R.L.'s (AES Panama) proposed up to USD375 million senior
unsecured notes due up to seven years.

Concurrently, Fitch has assigned a national scale rating of 'AA-
(pan)' to USD375 million senior unsecured notes due up to seven

AES Panama's ratings are based on the company's strong portfolio
of assets with a competitive dispatch position, its multiple power
purchase agreements (PPAs) and its adequate historical financial
profile. The ratings also consider the company's exposure to
hydrology risk given its elevated contracted capacity, increased
volatility in cash flows evidenced during recent years and
weakening operating environment due to energy transmission
problems in the country. The Negative Outlook reflects weak
financial performance during the past year and increasing
liquidity pressures from the 2016 bond maturity. In addition, the
expected compensations from the government related to restrictions
in the transmission lines are under review by the country's
Supreme Court, which final result is uncertain.

Fitch expects the company's credit metrics will stabilize in the
short to medium term as a result of the start of operations of the
power barge in the first quarter of 2015 (1Q'15). The lower spot
prices and moderate improvements in hydrological conditions
observed since the second half of 2014 (2H'14) should lessen the
cash outflows for purchases of energy in the coming quarters.


Weakened Credit Metrics:

AES Panama's credit metrics deteriorated as a result of non-
planned purchases of energy in the spot market during 2014 and
2013 to fulfill obligations derived from its PPAs. The net impact
(monetary spot sales minus spot purchases) of these transactions
on AES Panama's operating cash was approximately -USD110 million
in 2014 and -USD117 million in 2013. EBITDA declined to USD12.0
million in 2014 (2013: USD56.7 million) from 77.2 million in 2012.

The company is exposed to spot prices volatility due to its high
contracted level. The pressure on credit metrics derived from high
spot prices as the country faced a severe drought period during
2014 and 2013. The company's spot energy purchases were 673GWh
during year 2014, above previous year purchases of 599GWh, and
well above the 2012 spot purchases of 397GWh. The annual average
spot price during year 2014 and 2013 was 217.05 (USD/MWh) and
211.43 respectively. This situation highlights the company's cash
flow volatility when hydrology lowers coupled with high contracted

Hydrology conditions for 2015 will remain lower than historical
annual average, caused by 'El Nino' effect, however, the dry
season (January to April 2015) reported a better hydrology than
2014, which could diminished the overall spot energy purchases
effect during the year. Last twelve months (LTM) EBITDA for the
period ended in March 31, 2015 reached USD56.9 million, showing a
positive impact of lower spot energy purchases since 4Q14 due to
lower oil prices. In addition, spot energy purchases during the
dry season accounted for 93.99GWh during January to March 2015,
which favorably compares to 267.80GWh purchases during January to
March 2014. The net impact on operating cash of these purchases
was -USD7.0 million during 1Q15, and -USD74.6 million during 1Q14.
Spot prices average for 1Q15 was 99.9 (USD/MWh).

Fitch expects company's cash flows will stabilize in the short to
medium term as a result of the company's margin recovery due to
lower spot purchases expenses benefited from low spot prices, and
the start of commercial operation of the power barge since the
second quarter of 2015. The power barge, Estrella del Mar,
initiated commercial operation on April 24, 2015. The power barge
will have a stable and predictable cash generation profile given
its fully contracted capacity, ability to transfer changes in fuel
prices and adequate margins. The barge will generate a cumulative
incremental EBITDA of approximately USD95.9 million in the next
five years, considering capacity payments only and operating
maintenance expenses. Revenues derived from energy dispatches will
depend on future market conditions, including spot prices. Fitch
considers this asset will improve the company's cash flows,
diversify its assets portfolio and slightly mitigate the impact of
ongoing adverse hydrology conditions.

Elevated Exposure to Hydrological Risk:

AES Panama maintains PPAs that represent approximately 92% of the
combined firm capacities of AESP and AES Changuinola for 2015 (93%
during 2014 and 2013), and 90% through 2016-2018 period. This
elevated level exposes AES Panama to changes in hydrological
conditions and spot market prices such as those observed during
2014 and 2013. The acquisition of the barge is part of the actions
being taken by the company to reduce its exposure to hydrology

Panama spot energy prices increased in 2014 and 2013 as a result
of a combination of a robust demand, adverse hydrological
conditions and congestion in the transmission lines, reaching a
peak spot price of US$291.9 MWh during summer season 2014. Since
2H14 spot prices have significantly decreased given the decline in
oil prices and somehow better year over year hydrological
conditions. Although the latter have improved during the three
months ended March 31, 2015 particularly in the west of the
country, they still remain below the historical average. Prices
considered in PPAs with Distribution companies, the company's
largest clients, are below USD100/MWh. Cash flows could
deteriorate should hydrology remain abnormally low.

AES Panama's operations are being pressured by delays in the
expansion of country's transmission infrastructure. This has
further exposed the company to the spot market and triggered the
government to compensate the affected generation companies. Last
year the Panamanian government agreed to compensate the issuer for
purchases in the spot market during 2014 through 2016, by the
spread between the spot and the contract price associated to 70MW.

The compensations have a cap of USD40 million in 2014, USD30
million in 2015 and USD30 million in 2016. AES Panama was
compensated for the spot purchases by USD39.5 million during 2014
(USD23.2million collected during 2014, USD13.4 million collected
as of March 2015). Future government compensations during 2015 and
2016 will continue subject to resolution from the Supreme Court of
Panama to determine if the Cabinet Resolution, which approved the
compensation, was granted as per Constitution of the Republic of
Panama. The Comptroller General of Panama filed the consultation
for the Supreme Court. Due to current low spot prices, the
issuer's annual compensation amount estimated for 2015 and 2016
will be below USD10 million per year.

Cash Flow Supported by Contractual Position:

AES Panama's ratings reflect company's contractual position with
low counterparty risk. Generation companies in Panama are
permitted to enter into PPAs for up to their firm capacity
allocation. According to the local regulator, firm capacity is
calculated based on a 30-year historical average. The regulations
promote the use of PPAs by requiring distribution companies to
secure 100% of their peak regulated demand for the following year.
AES Panama maintains PPAs for approximately 91%, on average, of
available capacity through 2018. The commercial strategy of AES
Panama aims to release committed capacity in the short-to-medium
term to reduce its exposure to the spot market.

The company sells electricity under separate PPAs with the
country's three distribution companies, Empresa de Distribucion
Electrica Metro-Oeste S.A. (Edemet), Elektra Noreste (Fitch IDR of
'BBB'), and Empresa de Distribucion Electrica Chiriqui (Edechi),
with various maturities. Panamanian distribution companies appear
to have the sufficient credit quality and financial ability to
support their respective obligations under the PPAs with AES

AES Panama is the largest generation company in the country based
on installed capacity accounting for 18.4% market share (without
considering AES Changuinola installed capacity of 223MW). AES
Panama benefits from a competitive portfolio of low-cost
hydroelectric generating assets, including dam-based reservoirs
and run of the river units. The company is composed of four
hydroelectric plants throughout the country with a total installed
capacity of approximately 482 MW and different dispatch
priorities. The thermal plant, Estrella del Mar, has an installed
capacity of 72MW.

The diverse location of the company's assets somewhat mitigates
its exposure to hydrology risk as the plants are located in
different hydrology regions. The Esti, La Estrella and Los Valles
facilities are run of river plants in the western part of the
country, and together accounted for approximately 65% of total AES
Panama's generation during 2014 (2013: 57%). Bayano contributed
with 35% of total 2014 generation (2013: 43%). The overall
generation of AES Plants during 1Q15 was 13.4% approximately
higher than 1Q14.

Weakening Liquidity and No Foreign Exchange Risk:

The company's liquidity position has been affected during recent
years as a result of weaker cash flow generation from operation
and the company's continued dividend payment policy in 2013.
Currently, the amortization schedule is concentrated in 18 months
due to the USD300 million senior unsecured notes maturing in
December 2016, which exposes the company to refinancing risk. Cash
on hand as of March. 31, 2015 was approximately USD47.3 million;
additionally the issuer maintained restricted cash for
approximately USD10 million in the Debt Service Reserve Account.

AES Panama's debt as of March 2015 is composed of USD300 million
senior unsecured notes, the USD57.3 million bank debt which funded
the acquisition of the 72MW power barge, and USD35 million in
working capital lines. LTM Leverage ratio, as measured by total
debt to EBITDA, was 6.9 times (x) as of March 2015. The company's
financial policy is to maintain a minimum cash balance of USD20
million and future dividend payments may follow this policy.

Historically, AES Panama has been able to access bank and debt
capital markets. The company plans to refinance in advance the
2016 bond maturity. The long-term debt maturity is expected to be
extended up to seven years through a senior notes issuance that
could range between USD300 - USD375 million. The rating Outlook
could be revised to Stable as company's liquidity position
strengthens, in conjunction with a stable and sustained cash flow
generation measured by EBITDA in the medium term.

Exposure to Regulatory Risk:

The company's ratings also reflect its exposure to regulatory
risk. Historically, generation companies in Panama were
competitive unregulated businesses free to implement their own
commercial strategies. In the past years, the increase in
electricity prices has resulted in increased government
intervention in the sector in order to curb the impact of high
energy prices for end-users.


A downgrade could result from a combination of the following
factors: leverage above 4.0x on a sustained basis, increased
government intervention in the sector coupled with weakening
regulatory framework, inability to reduce exposure to the spot
market, and/or payment of dividends coupled with high leverage

Factors that could trigger a positive rating action include: a
sustained decrease in leverage below 3.0x coupled with an
effective diversification of revenues among different energy
sources, and reduced exposure to the spot market.


Key assumptions within Fitch's rating case for the issuer include:

   -- The company will continue to be exposed to spot market
      prices volatility until contract level decline in 2019;
   -- Low spot prices will contribute to margin recovery during
      2015. There is no expectation of strong rebound of
      international oil prices that could pressure spot prices
      during 2016;
   -- Transmission line constraints will remain until 2016;
   -- 2016 bond maturity is refinanced in advance.

Fitch currently rates AES Panama as follows:

   -- Long Term Issuer Default Rating (IDR) 'BB+'; Rating Outlook
   -- Local Currency IDR 'BB+'; Rating Outlook Negative
   -- National Long Term Rating 'AA-(pan)'; Rating Outlook Stable


INKIA ENERGY: Fitch Affirms 'BB' Issuer Default Ratings
Fitch Ratings has affirmed the local and foreign currency Issuer
Default Ratings (IDR) of Inkia Energy Ltd (Inkia) at 'BB' and
maintained the Negative Outlook. The rating action includes the
affirmation of the company's international bonds outstanding
totalling USD450 million due 2023.

Inkia's Negative Outlook reflects Fitch's concerns that the
company could distribute significant dividends and other cash
payments to its shareholder before its various expansion
projects begin generating additional cash flow. This concern was
initially sparked by Inkia's decision to repay USD167 million of
subordinated intercompany loans to its former parent, Israel
Corporation (IC), in 2014, in addition to a USD32 million dividend
payment. Fitch grants an equity credit for these loans and
considers that a repayment and/or other transfers to the
shareholders have the same effect of a dividend payment.
Additionally, consolidated leverage continues increasing as the
result of the company's pursuit of new investment opportunities.

Inkia's ratings are supported by the solid credit profile of its
most important subsidiary, Kallpa, a 1,063-megawatt (MW) Peruvian
thermoelectric generation company. Kallpa's credit quality is
supported by its contractual position and competitive cost
structure; Inkia has a 75% participation in Kallpa. Inkia's
ratings also incorporate the geographic diversification of its
assets, large expansion projects, and expected improvements in its
financial profile following the completion of these projects.


Credit Profile Linked to Kallpa:

Kallpa Generacion S.A.'s (Kallpa) credit quality is supported by
its competitive cost structure and contracted position. Kallpa's
power purchase agreements (PPAs) represent most of its firm energy
for the period 2014-2021 (excluding the Las Flores plant) and
support cash flow stability through fixed payments and fuel cost
pass-through clauses. The company has secured 100% of its natural
gas needs under long-term gas supply contracts through 2022. In
2014, Kallpa's EBITDA represented 61% of Inkia's consolidated

Historically, Inkia has aggressively sought to increase Kallpa's
generation capacity. In August 2012, Kallpa completed an expansion
project which increased the plant's installed capacity to 870 MW
from 581 MW and improved its efficiency through the installation
of a 289 MW combined-cycle unit. In 2014, the company acquired Las
Flores, a 193 MW simple-cycle gas power plant located 3Km from
Kallpa's plant.

High Leverage Driven by Growth Strategy:

Inkia's stand-alone financial profile has historically been weak
for the rating category and leverage is expected to remain high
for the foreseeable future. Between September 2013 and March 2015,
consolidated LTM leverage increased from 4.2x to 7.4x as result of
i) debt related to CdA, ii) the acquisition and debt consolidation
of assets in Nicaragua, Jamaica, Colombia, and Guatemala, and iii)
debt related to Samay I.

In the short- to medium-term, leverage is expected to weaken as
the company issues a further USD200 million in new debt, mostly to
finance its projects Cerro del Aguila (CdA) and Samay I and the
acquisition of Las Flores. Consolidated leverage metrics could
then return to approximately 3.5x to 4.0x, absent additional
investments that can perpetuate the company's high consolidated

Debt Structurally Subordinated:

Inkia's debt is structurally subordinated to debt at the operating
companies. Total debt at the subsidiary level amounted to
approximately USD1.370 million, or 75% of total consolidated
adjusted debt at as of first quarter 2015 (1Q15). The bulk of this
debt is represented by notes issued by Kallpa to fund its capacity
expansion. This project finance-like debt has a standard covenants
package including dividend restrictions and limitations on
additional indebtedness.

On an unconsolidated basis, Inkia's cash flow depends on dividends
received from subsidiaries and associated companies. In FY2014,
the company received distributions of USD124 million, the largest
contribution of which comes from Kallpa. Kallpa's project finance-
like debt has a standard covenant package including dividend
restrictions and limitations on additional indebtedness. Kallpa is
restricted from paying dividends if its debt service coverage
ratio (DSCR) falls below 1.2x (approximately 1.3x in FY2014).

Portfolio of projects with stable cash generation profile: Cerro
del Aguila is a 510 MW hydro plant with long-term PPAs for
approximately 402 MW starting in 2016. The project is estimated to
cost USD910 million and Inkia expects to fund this project with
approximately 65% debt and the balance with equity. The plant
would likely benefit from an existing reservoir in the Mantaro
river basin; Inkia estimates a capacity factor close to 70% for
this plant in the years immediately following commencement of
operations. Samay I is a 600 MW dual-fuel power plant, which will
operate initially as a cold reserve plant. It will receive fixed
capacity payments for 20 years. Inkia has approximately a 75%
participation in each projects. Fitch expects a significant
improvement in the financial profile of the issuer after these
projects start generating cash flows in 2016.

Asset Diversification:

The ratings also take into consideration the company's geographic
diversification. Excluding its Peruvian operations, Inkia
generated approximately 28% of its consolidated EBITDA (plus
dividends) in 2014 from assets located in Bolivia (rated 'BB-' by
Fitch), Chile ('A+'), Colombia ('BBB'), the Dominican Republic
('B'), El Salvador ('BB-'), Jamaica ('B-') and Panama ('BBB').
Over the past few years, cash flow from these assets was of
strategic importance for Inkia. After the completion of Kallpa's
expansion, these assets represent a smaller portion of cash
distributions to the holding company.


Negative Drivers: A negative rating action could be triggered by a
combination of: Inkia pursuing additional opportunities in
generation without an adequate amount of additional equity;
cashflow-negative construction delays and/or consolidated leverage
does not decrease below 4.0x after Cerro del Aguila and Samay I
commence operations; the company implements a dividend policy
while leverage is high; or its asset portfolio becomes more
concentrated in countries with high political and economic risk.

Positive Drivers: Although a positive rating action is not
expected in the near future, any combination of the following
could be considered: the Peruvian operation's cash flow
contribution increasing beyond current expectations, and/or
leverage declines materially.


Strong Short-term Liquidity Position:

Inkia's ratings reflect the strong liquidity profile it maintained
during its expansion process. Liquidity is supported by cash on
hand and readily monetizable assets, such as its recent sale of
EDEGEL for net cash inflow of approximately USD360 million. The
company's 1Q15 cash position of USD402 million compares with
short-term debt of USD144 million. While Fitch views positively
the company's cash position relative to short-term debt, we do not
net it out of long-term debt in our analysis. Inkia is
aggressively pursuing a growth strategy - both organic and
inorganic - that obviates any potential long-term benefit from the
company's robust liquidity position.

The company benefits from access to local capital markets to
finance investment projects at the subsidiary level. Currently,
the company has a syndicated bank facility for up to USD591
million to finance the construction of the CdA hydroelectric
generation plant (project finance debt) and negotiated a facility
for up to USD 311 million to finance Samay I.


   -- More than 100% growth in EBITDA over the next three years as
      Cerro del Aguila and Samay I commence operations.

   -- Gross consolidated debt peaking at just over USD2 billion in
      the next 24 months.

   -- Leverage decreasing to between 3.5 and 4.0x as new projects
      improve EBTIDA and debt amortizations gradually shrink total
      debt. Interest coverage should rise to approximately 3.5x
      during the same period


Fitch has affirmed the following ratings:

Inkia Energy Ltd.

   -- Foreign and local currency Issuer Defaul Ratings (IDRs) at

   -- International senior unsecured bond ratings at 'BB'.

   -- The Rating Outlook is Negative.


Monday's edition of the TCR-LA delivers a list of indicative
prices for bond issues that reportedly trade well below par.
Prices are obtained by TCR-LA editors from a variety of outside
sources during the prior week we think are reliable.   Those
sources may not, however, be complete or accurate.  The Monday
Bond Pricing table is compiled on the Friday prior to publication.
Prices reported are not intended to reflect actual trades.  Prices
for actual trades are probably different.  Our objective is to
share information, not make markets in publicly traded securities.
Nothing in the TCR-LA constitutes an offer or solicitation to buy
or sell any security of any kind.  It is likely that some entity
affiliated with a TCR-LA editor holds some position in the
issuers' public debt and equity securities about which we report.

Tuesday's edition of the TCR-LA features a list of companies with
insolvent balance sheets obtained by our editors based on the
latest balance sheets publicly available a day prior to
publication.  At first glance, this list may look like the
definitive compilation of stocks that are ideal to sell short.
Don't be fooled.  Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets.  A company may establish reserves on its balance sheet for
liabilities that may never materialize.  The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.

Submissions about insolvency-related conferences are encouraged.
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S U B S C R I P T I O N   I N F O R M A T I O N

Troubled Company Reporter-Latin America is a daily newsletter
co-published by Bankruptcy Creditors' Service, Inc., Fairless
Hills, Pennsylvania, USA, and Beard Group, Inc., Washington, D.C.,
USA, Marites O. Claro, Joy A. Agravante, Rousel Elaine T.
Fernandez, Valerie U. Pascual, Julie Anne L. Toledo, and Peter A.
Chapman, Editors.

Copyright 2015.  All rights reserved.  ISSN 1529-2746.

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
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Information contained herein is obtained from sources believed to
be reliable, but is not guaranteed.

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delivered via e-mail.  Additional e-mail subscriptions for members
of the same firm for the term of the initial subscription or
balance thereof are US$25 each.  For subscription information,
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