Government says Chinese loans and French investment will help sustain the economy

Eager to dispel what he calls “news media efforts to spread financial discontent,” Ecuador Vice President Jorge Glas announced Saturday that China has agreed to loan Ecuador $2.8 billion. He also said that a $4.9 billion investment from a French oil company and a $1.5 billion infrastructure investment from private Chinese banks mean that the country will start 2016 on sound footing.

Vice President Jorge Glas

Substituting for President Rafael Correa at the government’s Saturday television broadcast, Glas said that last week’s repayment of global bonds and payment of a Christmas bonus to government workers proves that the government’s opposition and most of the news media were wrong in their predictions. “We did what they said we could not do and the people understand that they are not to be trusted,” he said.

Glas, who led a delegation to China two weeks ago, said that the Chinese government and private Chinese companies are eager to spend even more money in Ecuador in the coming years. “They reaffirmed that they are strategic partners in building the Pacific refinery,” Glas said. “This is yet another example where the opposition was wrong.”

Construction of the massive refinery near Manta has been stalled for most of 2015 due to lack of funding. The government has already invested about $1 billion on the site and some government critics have claimed that to project will never be completed.

Glas said the $2.8 billion will be delivered in early Febraury 2016 and will go mainly to complete several hydro electric project which the government says will make Ecuador energy self-sufficient with electricity left over to sell to Peru and Colombia.

French oilfield services company Schlumberger announced Wednesday it was committing $4.9 billion to oil production over a 20-year period. More than $1 billion will be paid immediately, according to the company which signed a contract last week with Ecuadorian state oil company Petroamazonas.