ASUNCION (Reuters) - Paraguay’s finance minister, German Rojas, has resigned and will be replaced next week by a 36-year-old central bank director, the country’s president said on Friday.
Rojas, who spearheaded a successful sovereign debt issue in August, is the first minister to quit the Cabinet of President Horacio Cartes since the conservative leader took office in August 2013.
Cartes picked the boyish-faced Santiago Pena as his next finance minister, describing him as a “bright young man” who would accelerate development of the South American country of 6.7 billion people.
“I am convinced he is the right person at this time for our administration,” Cartes said in comments to the state-run news agency Information Paraguay (IP).
Pena inherits an economy that has lost its shine as low soy prices globally and stagnant economic growth in regional powerhouses Brazil and Argentina hurt Paraguayan exports. The central bank estimates the economy expanded 4 percent last year from a whopping 14.2 percent in 2013.
A U.S.-trained economist, Pena worked at the International Monetary Fund before taking up his job as one of four directors serving under the central bank’s president in 2012.
One finance ministry source earlier told Reuters Rojas handed in his resignation on Dec. 24. A central bank official said Pena was traveling back to Paraguay on Friday from the chic beach resort of Punta del Este in neighboring Uruguay.
Cartes did not say why Rojas stepped down. The central bank source and local media cited personal reasons.
Rojas, who is in his mid fifties, had impressed investors during his two years at the helm of the finance ministry, during which the business-friendly government passed a new law setting a cap on the country’s fiscal deficit. But his strict budget management had created tensions with some colleagues and regional governors.
Paraguay completed a $1 billion issue of 30-year bonds in August, only the second time it has tapped international markets, offering a yield of 6.1 percent and rated BB- by Fitch.
Reporting by Daniela Desantis; Writing by Richard Lough; Editing by W Simon and Andrew Hay
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