Resolution 064/2009

BOARD RESOLUTION NO. 064/2009

SUBJECT: MONETARY OPERATIONS MANAGEMENT – APPROVES CHANGE OF DENOMINATION OF THE NATIONAL EMERGENCY CREDIT TO THE GENERAL TREASURY OF THE NATION APPROVED BY BOARD RESOLUTION NO. 024/2008 OF MARCH 17, 2008.

HAVING SEEN:

The Political Constitution of the State promulgated on February 7, 2009.

Law No. 1670 of October 31, 1995, of the Central Bank of Bolivia.

Supreme Decree No. 29438 of February 12, 2008.

Supreme Decree No. 29453 of February 22, 2008.

Supreme Decree No. 162 of June 10, 2009.

Board Resolution No. 095/2006 of November 7, 2006, which approves the Regulations for Credits to the Public Sector.

Board Resolution No. 024/2008 of March 17, 2008, which approves the national emergency credit to the General Treasury of the Nation (TGN) in the amount of US$ 600,000,000.-

Contract SANO No. 043/2008 of April 9, 2008.

The Note from the Ministry of Economy and Public Finance MEFP/VTCP/DGCP-60/09 of June 5, 2009.

The Report from the Monetary Operations Management GOM - SOSP No. 003/2009 of June 8, 2009.

The Report from the Economic Policy Advisory APEC/SMyF –015/2009 of June 8, 2009.

The Report from the Legal Affairs Management SANO No. 156/2009 of June 8, 2009.

The Report from the Administration Management GADM No. 053/2009 of June 9, 2009.

CONSIDERING:

That the Ministry of Economy and Public Finance, through note MEFP/VTCP/DGCP-60/09, requests the change of denomination of the credit granted, in order to deepen the process of Bolivianization within the framework of Article 326, numeral 2 of the Political Constitution of the State, which establishes that public transactions in the country will be carried out in national currency.

That the Supreme Government has promulgated Supreme Decree No. 29438, by which a national disaster situation is declared due to the presence of adverse hydrometeorological and climatic phenomena caused by the "La Niña Phenomenon 2007-2008," authorizing the Ministries of Development Planning and Finance to manage and process before the Central Bank of Bolivia the granting of a credit to address urgent needs derived from natural disasters, in accordance with what is provided for in Article 22, subsection a) of Law No. 1670.

That Supreme Decree No. 29453, in its Article 7, provides that the Ministry of Finance is authorized to manage and process before the Central Bank of Bolivia the granting of a credit of Bs. 4,500,000,000.- (Four billion five hundred million 00/100 Bolivianos) to address the urgent needs derived from the national emergency that the country suffered, its reconstruction, and the promotion of production, in accordance with Subsection a) of Article 22 of Law No. 1670 of October 31, 1995 of the Central Bank of Bolivia.

That for such purposes, and in attention to a communication from the then Ministry of Finance, the Board of Directors of the BCB, through Board Resolution No. 024/2008, approved the granting of a national emergency credit of up to six hundred million United States dollars (US$ 600,000,000.-) or its equivalent in Bolivianos, signing contract SANO No. 043/2008.

That Supreme Decree No. 0162 determines in its Final Provision that within the framework of Article 7 of Supreme Decree No. 29453, the BCB will disburse, in Bolivianos, the outstanding balance of the credit granted to the Ministry of Economy and Public Finance, and that the TGN will cover the exchange rate differences resulting from the balance reconciliation carried out between the BCB and said Ministry.

That the Monetary Operations Management, in Report GOM – SOSP 003/2009, states that based on what is determined by the Regulations for Credits to the Public Sector, in the opinion of that Management, the Foreign Currency Treasury Bonds that guarantee this operation must be replaced by Bonds in Bolivianos, which must also be registered in the Securities Market registry and be negotiable on the stock exchange.

That the Economic Policy Advisory, in its report APEC/SMyF 015/2009, concludes that the change of denomination of the currency of the National Emergency Credit requested by the MEFP will not affect the fulfillment of the total internal credit and CIN to the SPNF targets for the 2009 management, since the undischursed balance is programmed and the monetary effect is inherent to the final use of the resources.

That in the opinion of the Legal Affairs Management in Internal Communication SANO No. 156/2009, there is no legal impediment for the Board to approve the change of denomination of the credit, requested by the Ministry of Economy and Public Finance.

THEREFORE,

THE BOARD OF DIRECTORS OF THE CENTRAL BANK OF BOLIVIA

RESOLVES:

Article 1.- Approve the change of denomination of the credit to the TGN from United States Dollars to Bolivianos.

Article 2.- In application of Supreme Decree No. 29453 and Supreme Decree No. 0162, the balance of the credit approved through Board Resolution No. 024/2008 is Bs 2,725,048,000.-

Said balance will be disbursed in Bolivianos until December 31, 2010, keeping all other conditions of said credit unchanged.

Article 3.- Authorize the President to sign the respective Addendum with the Minister of Economy and Public Finance.

Article 4.- The Presidency and the General Management are charged with the execution and compliance of this Resolution.

La Paz, June 10, 2009

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Gabriel Loza Tellería

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Gustavo Blacutt Alcalá Hugo Dorado Araníbar

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Rolando Marín Ibáñez Ernesto Yáñez Aguilar Rafael Boyán Téllez