SAN SALVADOR, April 10 El Salvador on Monday
defended its financial stability in response to rating agency
Fitch's assessment it was in default of debt obligations, after
the government failed to secure political backing to service
interest payments due in April.
Fitch earlier said it judged the tiny Central American
country "to be in default on its sovereign obligations" for
failing to make interest payments on debt to private pension
funds worth nearly $29 million.
Last week, the government, headed by the leftist Farabundo
Marti National Liberation Front (FMLN), could not get the
necessary support from the conservative opposition to approve a
financial package that covered the interest payments.
The government was solvent, said Ricardo Perdomo, who heads
the Superintendence of the Financial System, a state-run body
charged with overseeing market stability.
"The (non-payment) is not a liquidity problem, and we expect
this problem to be solved via political agreement," he told
El Salvador's finance ministry said the government had the
means to meet its obligations, and just needed to secure the
necessary parliamentary approval to proceed.
(Reporting by Gerard Arbaiza and Enrique Pretel; Editing by