Chapter 78 : That Time I Issued Government Bonds in South America

TL: Skye

Three years and three months since Yu-jin became Acting President.

In that time, San Marcos had changed so completely it was as if heaven and earth had been remade.

The Nickel Mine turned steady profits, a massive oil field holding 2.6 billion barrels had been developed, and the refinery plants and chemical factories running on that crude squeezed out every last dollar of return.

And that was hardly all.

The Resident Registration Project had added a full four million to the population, and to put those people to work, highways began going down all across the country.

And on the strength of these policies, GDP had tripled.

Granted, a number like that was only possible because San Marcos's economy had started from practically zero, but no one could deny that the Yu-jin administration had delivered staggering results.

But.

'Too slow.'

Yu-jin saw it differently.

He wanted San Marcos to develop even faster.

The reason was simple.

'At this rate, there's no way I retire within seven years.'

Because he had never intended to serve a second term in the first place.

He had already held de facto power for three years. By the time his first term ended, that would round out to a full ten.

And if he served again, tack on another seven: seventeen years on the job.

Yu-jin, who had squirreled away his salary all the while (as Acting President, he had continued drawing his minister's pay) and rebuilt his one million dollars, had absolutely no intention of working that long.

One million dollars. Roughly 1.4 billion won.

Some people might ask.

Can anyone actually retire on that?

In Korea, of course, impossible.

But in San Marcos?

A million dollars was more than enough to live out his days fishing at his leisure.

He could even buy a decent building and live off the rent!

Dreaming of that life, Yu-jin grew restless, and soon began agonizing in secret.

How could he accelerate San Marcos's development?

How could he retire faster?

Gonoe, anguish. Go (苦), to suffer; noe (惱), to be tormented.

For some ten days, Yu-jin kept up that exact regimen of suffering through his thoughts and tormenting himself, until enlightenment struck him like a bolt of lightning.

"I can just win the money and pay it back?!"

Why had Yu-jin been courting investment from Korean companies in the first place?

Because there was no money, obviously.

So, pop quiz.

What's the fastest way to pull in money under the current circumstances?

Issuing government bonds, of course.

Despite three years of tremendous growth, San Marcos was still the developing-est of developing countries.

Pour in money, nurture industry, shower the people with jobs, and it could grow at breakneck speed.

After that, just pay off the bonds with the tax revenue rolling in. Done!

"Why didn't I think of this sooner?"

Most countries carry national debt in proportion to their GDP.

Reserve currency nations run debt close to 100 percent; non-reserve currency nations borrow and spend at around 50 percent.

And the same goes for developing countries. The average debt-to-GDP ratio among South American nations hovered around 60 percent.

Which meant San Marcos could shoulder that much debt too, and plugging in its current GDP, that translated to more than 30 billion dollars it could pull forward.

Except to do that, it first had to clear away debt so old it had gone beyond stagnant and practically fermented into crude oil.

Hence the negotiation with Russia, conducted through Korea with America's blessing.

And so, having shaken off that musty old debt, Yu-jin...

"Let's issue government bonds."

...began gearing up for borrow-and-repay in earnest.

***

"......"

The moment I made the case for issuing government bonds, silence settled over the conference room.

Honestly, fair enough.

It was effectively proposing we take on debt the second we'd finished paying off debt.

But.

'That's exactly why I paid it off in the first place.'

For my early retirement, San Marcos needed to develop at least twice as fast as it was now, and that made a bond issuance non-negotiable.

Senior Secretary for Finance Ricardo spoke up, his eyes full of misgiving.

"...May I ask what scale of bond issuance you have in mind?"

"I was thinking somewhere around this much."

Instead of answering, I held up two fingers.

"Two billion dollars, sir? That's not especially larg..."

"Two billion dollars wouldn't make a dent in anything. I intend to issue twenty billion dollars in bonds, twice, over the next two years."

"Y-Your Excellency! Th-that's far too much. With interest rates trending upward lately, an issuance of that size could saddle us with crushing interest payments."

"No need to worry. We'll be earning money faster than the interest comes due."

At this talk of winning it back to repay it, Isabella stepped in.

"Was settling the Russian debt about clearing the way for a bond issuance, by any chance?"

"It was."

"Then may I ask why you wish to issue the bonds?"

"Oh, plenty of reasons."

I unveiled before everyone the grand design I had agonized over and over to produce.

[Six-Year Economic Development Plan]

Astonishment flickered in the Cabinet members' eyes as they took in the screen.

"A Six-Year... Economic Development Plan?"

Convention called for cutting these things into five- or ten-year blocks, but with exactly six years and nine-odd months left in my term, six years it was.

'I'll be a lame duck for the last nine months anyway.'

In place of a pointer, I lifted the presidential ceremonial long sword, scabbard and all, and aimed it at the screen.

"Until now, we have governed this nation by scrambling to put out whatever fire happened to be in front of us."

Everyone let out a pained groan at the accuracy of the criticism.

"I'm not blaming any of you. Had we not dealt with what was right in front of us, the country would have fallen into crisis."

"......"

"But from this point on, that will no longer do. We must pursue government-led national development under a rigorous plan."

"Then the bond issuance is..."

"The capital that funds our economic development."

"Bonds issued for economic development... That does seem entirely sound."

The moment Isabella nodded, the Senior Secretaries piled on.

"Your Excellency's profound vision! At last I understand!"

"Truly, that is Your Excellency for you! You see what ordinary men like us could never dare to glimpse!"

"Ahh...! I, Ricardo, hereby pledge my loyalty to Your Excellency!"

"No."

I hadn't even started the explanation yet...

"I believe the admiration can wait until you've heard the entire plan."

Everyone clammed up, and I resumed the presentation.

"San Marcos's single greatest problem right now is a shortage of infrastructure. We're building highways, but not enough, and the provinces don't even have proper cities. Hospitals have been scarce since forever. But if I had to name the scarcest infrastructure of all..."

I clicked the remote, the first slide gave way, and a new title appeared: [Power Supply Expansion Plan].

"It's electricity."

"......"

"To grow a nation's core industries, power is essential. But our current supply falls hopelessly short of what industry demands."

San Marcos's power supply couldn't cover even 70 percent of demand.

It had once been close to 100 percent, but with industrial complexes expanding and Korean companies moving in, the country had fallen badly short of power.

So where did the missing 30 percent come from?

From rationing household electricity, that's where.

'Definitely not a good way to run things.'

Because of it, come ten at night, the citizens of Libertad lived by candlelight.

"Isn't that why you commissioned the nuclear power plant from Korea?"

As Isabella said, it wasn't as though nothing had been done about the problem.

The problem was.

"That nuclear plant needs four years to complete. And for today's San Marcos, those four years are far too precious to lose."

A nuclear power plant doesn't get built overnight.

"Have any of you walked through downtown Libertad at ten at night? Investors arrive expecting a dazzling skyline and instead find our citizens sweating over dinner by candlelight. What company would invest in a country where the factories grind to a halt for lack of electricity?"

The Senior Secretaries shrank into their collars.

"Which is why I intend to bring in a solar power plant and ESS."

Another click of the remote, and a map appeared with an enormous power plant icon drawn over the plains beside Libertad.

"...That would certainly be the fastest solution. But I suspect that once the nuclear plant is complete, generation would actually end up exceeding demand."

"It would. From a certain angle, some might call it redundant investment, even overinvestment. So here's what I propose."

Beep.

A red X appeared on the map, right over the thermal power plant.

"Once the nuclear plant is finished, we demolish the thermal plant. Honestly, it's more than thirty years old; the efficiency just isn't there anymore, is it? Or else..."

Beep.

Another click, and this time a black line stretched from Libertad's southern port toward the Dominican Republic.

"We could sell the surplus power at a discount. You're all familiar with the Dominican Republic's electricity situation, yes?"

"Whoa..."

The exclamation slipped out of Senior Secretary for Commerce Aman.

I looked around at everyone and said.

"Alongside the construction of the solar plant, I intend to establish the San Marcos National Electric Power Company."

"I have a question."

Isabella asked, her eyes brimming with interest.

"May I know why you would create a state-owned power company rather than go through Tortilla?"

"Tortilla today is already half a state enterprise, true. But water and electricity are essential infrastructure, which is why I intend to make them 100 percent public."

"Your Excellency truly puts the people first, to the very end."

"...This is simply common sense."

"It is not. There isn't a single country in Latin America where power has not been privatized."

"Then those countries are the strange ones. Nothing is more dangerous than handing a necessity like electricity over to the private sector, to entities whose entire purpose is the pursuit of profit."

"...!"

"Power privatization, in the end, means wringing the lifeblood out of the people to fatten corporate bellies. For at least as long as I hold this office, not one citizen will live in fear of their electric or water bill. This is my philosophy and my conviction, so let everyone here take note."

At the calm, level warning, the Senior Secretaries sat up straighter.

"The state steps forward for the public good, and the people reap the benefits..."

Isabella murmured, half in a daze.

Every last shred of doubt about the bond issuance had vanished from her eyes.

"Once we've resolved the power crisis as phase one, the plan is to grow our core industries in earnest. And the bond money will be spent right here."

I set the long sword down and drove the point home.

"Senior Secretary Ricardo, begin drafting a detailed roadmap for the twenty-billion-dollar bond issuance immediately. The rest of you, start thinking about how to support the Ministry of Finance."

"Yes, Your Excellency!"

The Senior Secretaries' booming reply rang through the conference room.

But they had no idea.

That Yu-jin's real plan was to take the bond money, before a single solar panel went up, and balloon it through short selling.

Big bro Drump, help me out!

*****

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