This represents only 9.5% of what the Ministry of Finance had projected to issue.
The Ministry of Economy and Finance proposed to the State providers the payment of their debts using papers to be traded on the stock exchange on July 21, 2020. This initiative was not welcomed, since its acceptance was voluntary, but the Ecuadorian papers they have a penalty and the value they would receive for selling them is less than their real value.
In this sense, the Government planned to issue up to USD 500 million to settle debts with its creditors, but it has only issued USD 47.3 million to suppliers, which represents 9.5%.
The Government’s proposal consists of the delivery of a portfolio of papers that consists of 10% in treasury certificates (Cetes), which are papers that mature in less than a year. Another 30% of the amount owed is paid in government bonds with a three-year maturity; 40% of bonds with a maturity of five years and 20% with a maturity of seven years.
Another option that providers have is to trade these papers on the stock exchange, but that means receiving less capital due to the penalty that exists for these obligations.
Due to this, the majority of state providers rejected this initiative. In recent days they have staged several sit-ins and marches to demand that the Government cancel the amounts owed to them for more than a year.
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