[Marxism] Ecuador defaults on foreign debt
sartesian at earthlink.net
Sat Dec 13 10:37:12 MST 2008
Not the first time. Ecuador defaulted on its Brady Bonds (!) in 1999. And
as a result was "punished" when in 2005 (?) creditor countries cancelled $80
billlion of debt, Ecuador's debt was NOT included in the package.
Much of the turmoil goes back to the World Bank, which tried to prevent
Ecuador for changing the terms of its stabilization fund from protecting
debt payments and to funding social development.
Part of the turmoil goes back to the bilateral loan agreements between
Ecuador and creditor countries (Spain holds the biggest part of these). The
loans are in essence, nothing but letters of credit, purchase agreements
obligating Ecuador to use the loans to buy products from the creditor
countries, to be imported with transportation from the creditor countries,
with use, operation of the imports to be "managed" by technicians and
consultants from the creditor countries.
But... from my reading it doesn't appear that these bi-lateral agreeements
are the debt packages Correa defaulted against. Ecuador is defaulting on
its sovereign debt, its global bonds that trade in secondary markets.
Anybody have more information on this?
----- Original Message -----
From: "Eli Stephens" <elishastephens at hotmail.com>
To: <sartesian at earthlink.net>
Sent: Saturday, December 13, 2008 10:00 AM
Subject: [Marxism] Ecuador defaults on foreign debt
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