Friday, December 12, 2008

Ecuador Defaults on Bonds

by Calculated Risk on 12/12/2008 02:41:00 PM

From Bloomberg: Ecuador Defaults on Bonds, Seeks Restructuring

Ecuador won’t make a $30.6 million bond interest payment due Dec. 15, putting the country in default for a second time this decade, President Rafael Correa said. ... His decision comes as a deepening global economic slump throttles demand for oil, the country’s biggest export. Ecuador, which defaulted in 1999, owes about $10 billion to bondholders, multilateral lenders and other countries.
Ecuador exported about 400 thousand barrels of oil per day (2004 data) so the recent $100 per barrel drop in oil prices would be about $40 million per day less revenue. Other oil exporters will have problems too, although many oil exporters have significant foreign reserves.