(Adds background on fiscal reforms, previous issue)
By Davide Scigliuzzo
WASHINGTON, Oct 10 (IFR) - Costa Rica plans to raise US$1bn through a new international bond in the first half of 2015 as it pushes forward with reforms to reduce a growing fiscal deficit, the country's finance minister Helio Fallas told IFR on Friday.
The sovereign, rated Ba1/BB/BB+, is yet to determine the maturity of the new bond and to select banks to arrange the sale.
Fallas said the country would prefer to issue a long-dated bond, but that final terms will depend on market conditions.
Costa Rica took advantage of a strong bid for duration earlier this year to raise US$1bn through a new 30-year bond that priced at a yield of 7%.
The notes were quoted on Friday at a cash price of 102.25 to yield 6.82% mid-market.
The sovereign lost its last investment-grade rating in September, when Moody's downgraded the country to Ba1 from Baa3, citing its weak fiscal position and the political barriers to reforms.
Fallas said the government is planning to implement a number of reforms aimed at incresing revenues by clamping down on tax evasion and reducing expenditures.
Costa Rica is expected to post a fiscal deficit of 6% of GDP for 2014.
In 2015, the government anticipates coming in well below the 6.7% fiscal deficit indicated in the budget as reforms begin to yield results, said Fallas.
Reporting by Davide Scigliuzzo; Editing by Paul Kilby