Ecuador president plans foreign debt buyback

Posted on Saturday, 12.27.08
Ecuador president plans foreign debt buyback
The Associated Press

QUITO, Ecuador -- Ecuador is looking to buy back its bonds at a steep discount after defaulting on part of its foreign debt.

President Rafael Correa says Ecuador may attempt to buy back its foreign debt in January, without specifying which bonds it might purchase.

In his Saturday radio address, the president says, "Let's make a proposal: at the beginning of January, to repurchase this foreign debt, but obviously at a substantially lower value than the face value" of the bonds.

Ecuador is confronting a rising budget deficit, falling oil income and limited access to international credit markets after Correa's decision Dec. 12 to forego a $30.6 million interest payment due on $510 million in debt.

http://www.miamiherald.com/news/americas/AP/story/827945.html

Posted on Friday, 12.26.08
Report: Ecuador sells $700 mln debt after default
By JEANNETH VALDIVIESO
Associated Press Writer

QUITO, Ecuador -- Fresh from a $30.6 million default, Ecuador's government has issued $700 million in new bonds to help finance next year's budget, local media reported Thursday.

The Ecuadorean Social Security Institute bought all the new bonds, in line with regulations that require it to invest half its funds in government debt, according to the Guayaquil newspapers El Universo and Expreso.

~snip~
To finance the budget, Correa has said Ecuador is seeking new loans from the Washington D.C.-based Inter-American Development Bank and the Caracas-based Andean Development Fund.

On Tuesday, he said his government would issue new bonds to finance road works and other unspecified investment projects, but gave no other details.

A public audit last month recommended that Ecuador default on bonds due in 2012, 2015 and 2030, whose contracts auditors called "illegitimate, corrupt and illegal." Those bonds together represent about 40 percent of Ecuador's $10 billion in foreign debt.

More:
http://www.miamiherald.com/news/americas/story/826414.html