Ecuador pushed forward with its debt overhaul plans on Monday, requesting a vote among its creditors on reconfiguring the terms of US$ 17.4 billion of its external bonds, with its largest group of creditors backing the proposal.
Ecuador’s government will likely have to sweeten its offer to creditors in order to reach an agreement to restructure US$ 17.4 billion in bonds, say analysts. The government’s proposal already has the backing of one group of creditors, holding around half of the bonds and including AllianceBernstein, Ashmore and BlackRock.
Holders of Ecuador sovereign bonds have formed a committee to hold talks with the country's government on a potential re-profiling of the country's external debt, the group said in a statement on Thursday.
Guayaquil, Ecuador’s largest coastal city has been ravaged by coronavirus with bodies buried in mass graves or kept in newly-filled shipping containers to help relatives identify their loved ones among the decomposing corpses.
Demonstrators defied coronavirus restrictions to march in cities across Ecuador on Monday in protest against President Lenin Moreno's drastic economic measures to tackle the crisis.
LATAM Airlines Group, the largest airline conglomerate in Latin America, announced it will lay off 1,400 workers from its branches in Chile, Colombia, Ecuador, and Peru. The news was confirmed by the company on May 15, after Reuters released an internal video where LATAM CEO Roberto Alvo announced the measures to its employees.
The World Bank Board of Directors approved a flexible US$500 million loan to help cover Ecuador's budget needs during the Covid-19 emergency and to promote economic recovery. The loan is the second in a series of three Development Policy Financing (DPF) operations. The first loan of this series was disbursed in June 2019. The operation has been adapted to the current context and to the country’s needs during the pandemic.
Ecuador on Monday exceeded 30,000 confirmed cases of the coronavirus, while the government launched a plan to start gradually relaxing quarantine measures that have been in place since mid-March. Ecuador has confirmed 31,881 cases of COVID-19, with 1,569 reported deaths and a further 1,336 deaths likely as a result of the virus.
Ecuador received a temporary reprieve over the weekend when the government announced that a sufficient number of investors had agreed to a consent solicitation to defer interest payments.
The coronavirus outbreak in Ecuador is increasing pressure on President Lenin Moreno to default on US$ 17 billion in debt and devote more resources toward fighting a pandemic that has left bodies in the streets of the nation’s largest city.