(Bloomberg) -- Colombia is tapping global debt markets for the first time this year, testing investor appetite for junk-rated emerging-market bonds.

The South American oil producer is offering $1.3 billion more of the social notes due in 2035 and 2053 that it first issued in November, with yields expected at 7.55% and 8.15%, respectively, according to person familiar with the matter, who asked not to be identified because they’re not authorized to speak about it.

The proceeds will be used to fund social programs under the nation’s ESG guidelines.

The bonds were originally sold last year in a two-tranche deal in which the nation raised $2.5 billion, with coupons of 8% and 8.75%. S&P Global Ratings cut Colombia’s credit outlook to negative in January on “potentially persistent weak investor confidence” that risks weighing down growth.

Aaron Gifford, an emerging markets sovereign analyst at T. Rowe Price in Baltimore, said investors demand a premium to hold Colombia debt due to the lax government approach to fiscal policy and challenges on economic growth. 

President Gustavo Petro’s administration moved late Tuesday to assert control over one of the nation’s largest health insurer, a sign of how the leftist leader is turning to direct intervention in private industry as his efforts to overhaul the economic model through congress stall. 

Existing Colombia bonds edged higher across the curve Wednesday, after a short-lived selloff that had them leading losses in an emerging-market government bond index compiled by Bloomberg. They are still among the worst performers in the index this year, handing investors losses of 3.6%, compared to 1.8% for peers. 

The nation follows a string of junk-rated issuers — including Brazil, Turkey, and the Ivory Coast — that have successfully issued debt on international markets this year as volatility in US rates dwindles with the Federal Reserve expected to start cutting interest rates soon. 

Deutsche Bank Securities and Santander are managing the Colombia deal. 

--With assistance from Vinícius Andrade.

(Updates with pricing information and analyst starting in the second paragraph.)

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