LatinNews Daily - 04 August 2020

* Ecuador’s economy & finance minister, Richard Martínez, has announced that 97.85% of bondholders accepted the government’s debt restructuring proposal, well beyond the 66% threshold needed to secure a global deal. The government's proposal includes the reduction of the total capital owed on these bonds from US$17.4bn to US$15.8bn and eases the repayment schedule in light of the country’s economic difficulties. A small group of bondholders had sought to derail the negotiations through a lawsuit filed in the US last week, but this was rejected by a federal judge on 31 July. Ecuador’s President Lenín Moreno celebrated the approval of the deal as “great news for Ecuador”, that will “free up resources for social protection and economic reactivation”, while International Monetary Fund Managing Director Kristalina Georgieva described the agreement as “a momentous milestone that will help pave the way for inclusive and sustainable growth”. Martínez also welcomed the approval of the proposal, but warned that further action is still needed to address Ecuador’s substantial fiscal gap – he noted that there will soon be further news on the renegotiation of debt owed to the Chinese government.

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