As an attempt to affect the foreign debt negotiations, the Ecuadorian Government described the demand that they presented this Wednesday, July 29, the investment funds Contrarian Capital Management and GMO, in relation to the requests for consent.
In the lawsuit, these firms consider the invitation of the National Government to join the process as coercive ; However, the Ecuadorian Government affirms that this is completely far from the truth . By virtue of this, Ecuador, through a statement from the Ministry of Finance , reported that it rejects the attitude of the plaintiff firms that “have a minimum position of the total amount of the bonds involved in the negotiations.”
And he adds that the country “firmly opposes that these funds try to obtain additional economic benefits , above what was negotiated in good faith with the majority of the largest creditors.” The Government considers that the legal actions initiated by Contrarian and GMO are an attempt to set aside the collective action clauses expressly agreed in the contracts, which also provide for the consent of a substantial percentage of the holders.
Furthermore, he adds, they have had the same opportunity to participate as the other holders in the friendly process contemplated in the consent requests. “In the midst of an economic, health and humanitarian crisis, the country is experiencing precedent, Contrarian and GMO demand preferential treatment in the restructuring of the bonds.
“We will not give in to his attempt to boycott the process. The economic and social injury that this action would entail, could cause a strong setback in the country’s economic and health recovery ”, stresses the Ministry of Finance. The statement reiterates that Ecuador will continue to act under the best international practices, through a cooperative and friendly dialogue with bondholders, a process that has been supported by the international community, including the International Monetary Fund (IMF), the Inter-American Bank of Development (IDB), the World Bank and the United Nations (UN).
Finally, it was announced that the attorneys of the Republic will defend the country before the competent courts and it is hoped that the good sense, legality and protection of 17 million Ecuadorians will prevail, “above the particular interest of Contrarian and GMO”. (I)