QUITO: Ecuador will seek to return to the international capital market and is working to regain its credibility after restructuring its sovereign bonds, Economy and Finance Minister Simon Cueva said on Friday.
Last year, the country managed to restructure some $17.4 billion by exchanging about 10 outstanding papers for three new bonds maturing in 2030, 2035 and 2040 and improving interest rates.
After the exchange, Ecuador has not issued new debt to obtain financing despite its liquidity problems, exacerbated by the pandemic.
"Ecuador has a vocation to gradually return to the international capital markets," Cueva told reporters. "But do it in an orderly and predictable way."
"Ecuador has a not-so-good history in international markets with many stories of default, restructuring, and changes, and we want to build a serious, credible country abroad," he added.
President Guillermo Lasso will accommodate in his spending plan for next year "external placements" for some $1.2 billion, which would include bond issues and commercial operations with private banks.
But a decision to enter the capital market will depend on the internal economic measures promoted by his government, such as a tax reform, which is being debated in the legislature, and dialogue with multilateral organizations for new credits, Cueva said.
Ecuador has turned to the International Monetary Fund (IMF) and other lenders to seek financing in better conditions and hopes to maintain that debt as one of its main sources during 2022. The government foresees external loans of about $3.6 billion, according to the proposed budget for 2022.
In 2008 Ecuador declared a moratorium on part of its commercial debt. In 2014 it returned to the market with a paper issue. Sovereign bond debt amounted to about $17.7 billion, equivalent to 17.3% of GDP as of July 2021, according to data from the economy ministry.