Due to the high debt that Ecuador has with the multilateral, investors expect “precisely that the agreement with the IMF consists of a disbursement that is used exclusively for Ecuador to pay the debts due with said organization,” says José Xavier Orellana, partner of the Ecuadorian corporate finance and strategy firm Ahead Partners.
Ecuador must pay 2,761 million dollars to the IMF, not counting interest only between 2024 and 2026. Therefore, the program would reduce the payment pressure for Ecuador and with it the risks of non-payment to the rest of the creditors. So investors see that the risk of Ecuador falling into default is becoming less and less unlikely.
Great interest in investing in Ecuador
Thanks to this high expectation, the forum organized by the investment bank JP Morgan, in Washington (United States), attended by the Minister of Finance of Ecuador, Juan Carlos Vega, on April 17, 2024, had a full house.
The conference by the economic team of the Noboa Government lasted 45 minutes and totally aroused the interest of investors, “so much so that some people even listened to the talk standing up. Vega titled the talk “El Nuevo Ecuador” and gave details about the situation in which the Noboa Government received the fiscal accounts,” said the media Primicias .
However, the million-dollar question, literally, for investors is: When will the new agreement with the IMF be signed?
The minister responded: In “the next few days or weeks,” negotiations with the Fund will conclude, he said.
Other sources of financing for Ecuador
After closing the agreement with the IMF, Ecuador could also immediately receive other sources of financing with investment banks such as the British Barclays, for example , they have projected that Ecuador could receive financing for up to 4,000 million dollars if this type of agreement is finalized, also adding additional financing that the country could receive from other multilaterals.
This rapprochement with the IMF has meant that both the diplomatic impasse with Mexico and the complex energy situation that the country is going through have no influence, or if the impact is minimal, on the country risk and that this may decrease even further after the signing of the agreement with the IMF.
