By Alexandra Valencia
Ecuador’s new president, Lenin Moreno, said on Monday he would seek to refinance the Andean country’s “expensive” foreign debt in a bid to ease pressure on its economy.
OPEC’s smallest member has steep public debt due to short-term bonds and loans from key ally China, Ecuador’s top financier, largely accrued under ex-president Rafael Correa.
According to Correa’s former government, Ecuador this year has to cough up some $6 billion for debt payments and oil-for-loans, mostly to China.
As the country is squeezed by lower crude prices and steep borrowing rates, analysts have said the best option to raise fresh cash is to renegotiate current debts.
“We will go to whatever instances are necessary to be able to refinance this debt,” Moreno told journalists.
“I’ve spoken with (Chinese) President Xi Jinping about the possibility that we could at least establish longer maturities to allow more resources for national projects,” added Moreno, who has promised a swath of social spending.
Further details were not immediately available.
Moreno, a former vice president under Correa, has promised to govern in a more conciliatory style and improve relations with business.
Last week Moreno said he had reached out to the World Bank for potential financing that could help him fund ambitious social programs including free university education, health and housing for lower-income families, and subsidies to eradicate extreme poverty.
Credit: Reuters, http://in.reuters.com