Cuba to issue sovereign funds to finance deficit

Cuba will start issuing sovereign wealth funds in 2014 to finance the debt generated by the budgetary deficit, with an annual interest rate of 2.5 percent and expiring in a 20-year term, a senior official announced here Saturday. Minister of Finances and Prices, Lina Pedraza, said that in such a way the country will begin to finance up to 70 percent of the deficit, which is expected to reach 4.7 percent of the gross domestic product (GDP) in 2014. The remaining debt will be covered by money injection from the central bank. Pedraza made the announcement at a parliament discussion about the preliminary budget for 2014. The Cuban parliament debated Saturday the economic program for 2014, projecting a moderate growth of 2.2 percent, though prices of Cuba's main exporting items like sugar and nickel are expected to fall.