* Ecuador’s President
Lenín Moreno has announced that the government has reached a new agreement with an important group of bondholders, to renegotiate the terms of the country’s debt. According to Moreno, the principal payments owed on these bonds will fall by more than US$1.5bn (from US$17.4bn to US$15.8bn); maturities will be extended from an average of 6.1 years to an average of 12.7 years; the average interest rate will decrease from 9.2% to 5.3%; and a grace period will be introduced on principal and interest repayments, of five years and two years respectively. Economy & Finance Minister
Richard Martínez noted that over 50% of bondholders had agreed to the deal, below the 66% required to secure a global the agreement, but voiced optimism that this process will soon be completed; he also reiterated that the government is on track to complete all negotiations with bondholders by mid-August. Following the agreement, Ecuador’s country risk spread fell to 2,783 basis points – still significant, but well below the all-time high of 6,063 basis points registered in March,
when the government announced its intention to renegotiate its debt.
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