Ecuador

Foreign Minister Maria Isabel Salvador said Ecuador won't illegally default on its close to $4 billion in sovereign debt, Bloomberg reported today. While a debt audit called by President Rafael Correa has revealed evidence that crimes were committed when the debt was contracted, any decision to repudiate the debt will go ahead in accordance with the law, she said in a radio interview with Quito-based Ecuador Inmediato yesterday. “Ecuador will never act outside the law,” she said.

A debt auditor said Ecuador would find challenging its foreign debt in U.S. courts difficult because the country signed away its legal rights in bond agreements over a 20-year period, Bloomberg reported. Halting debt payments without the support of a court decision would be a “catastrophe” for the nation, said Alejandro Olmos, a member of a committee appointed by President Rafael Correa to review the debt. Bondholders could seize Ecuador’s assets, including those of state-owned oil company PetroEcuador, he said. Ecuador on Nov.

Ecuador's flirtation with a $10.3 billion foreign debt default may force bondholders into restructuring, potentially saving the government billions of dollars at a time when access to capital is increasingly tight, the Associated Press reported today. Ecuador is going to "present a credible threat of default and force bondholders to renegotiate the terms of existing debts, winning savings and considerable benefits for the state," Patrick Esteruelas, an analyst at the Eurasia Group in New York, said Wednesday.

The official overseeing an audit of Ecuador's foreign debt said his committee found evidence of abuses and irregularities tied to almost all of the country's bonds and will recommend a default on $10.3 billion in national debt, the Associated Press reported yesterday.