Ecuador and China
Is your debt increasing? Your bills piling up? Are you getting turned down for loans because you could not pay up?
Don't let it get you down. Turn that frown upside down and call China! They'll help, no questions asked. Dozens of happy less developed countries agree. Just open up access a bit to your natural resources, and the cash starts flowing in!
Ecuador's total foreign debt in April was $14.07 billion, up 3% from $13.67 billion in the same month of 2010, the central bank said.
The amount is equivalent to 23% of Ecuador's $62 billion gross domestic product forecast for 2011.
According to the bank, the country's public debt totaled $8.78 billion in April, up 15% from $7.65 billion a year earlier.
The April public debt figure is equal to about 14% of GDP.
Private-sector debt, meanwhile, stood at $5.29 billion, down 12% from the $6.02 billion posted in April 2010.
Ecuador has lacked access to financial markets since President Rafael Correa defaulted on $3.2 billion in foreign loans in 2008, but the Andean country has opened the door to China as Ecuador's leading lender.
Recently, Finance Minister Patricio Rivera said Ecuador is negotiating a $2 billion loan with China to finance several projects.
2 comments:
Perhaps you can clarify how exactly Ecuador is "opening up access to natural resources." Sure, Ecuador is promising to SELL more hydrocarbons to China, but that can hardly be considered a gift. And sure, China is investing in some major infrastructure and energy projects, but that is sorely needed - hardly a giveaway either.
Everyone is rapt to paint this emerging China lending as some kind of trojan horse, simply because it is supplanting US/IMF capital, which had much more strings attached.
It isn't clear to me as to what Greg's positions about Chinese lending --and the terms of Chinese lending-- are. I would guess that one would need to evaluate the terms of Chinese lending on a case-by-case basis, comparing such terms to whatever the alternatives are.
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