Colombia is launching its third global bond buyback in a year, aiming to retire about $4 billion in debt ahead of a tight presidential election. The government is seeking to repurchase dollar-denominated notes with maturities from 2035 to 2061 in cash, with the tender offer expiring April 24. The buyback comes as Colombia's longer-dated dollar bonds are among the top performers in emerging markets.

This move is part of a broader strategy to reduce borrowing costs and improve the nation's finances amid growing concerns over a widening budget deficit. Standard & Poor's recently downgraded Colombia's credit rating further into junk territory, citing a persistently large fiscal gap and high debt burden. The government has been under pressure since last year when it suspended a legal cap on fiscal spending.

To ease financial pressure, the Finance Ministry has explored alternative financing sources, including a total return swap with international banks, the first eurobond issuance in almost a decade, and billions in local debt private placements. Colombia's dollar notes have rallied in recent weeks as markets anticipate a potential shift toward a more market-friendly administration following the May presidential election.