Ecuador is a serial defaulter on its debts. In 183 years, the country has never managed to pay back any of its bonds on time. Until now that is!
Ecuadorean President Correa actually took to the twitter-verse to crow about the repayment. Seriously! I guess when you set the bar low enough, even a small accomplishment seems huge. As a side note, who are these crazily optimistic bondholders? I understand lending Ecuador money the first time. But how about the thousands of times since? Is there no learning curve?
Bondholders couldn’t have been too confident about repayment as the same President railed against international financial markets in 2008, saying the external debt was “‘illegitimate’, its bondholders ‘real monsters.’” Ecuador eventually defaulted on $3.2bn of global bonds (duh, of course they did) and later bought back its debt on the secondary market for “35 cents on the dollar.”
I’m guessing this is just a blip in an otherwise perfect track record and Ecuador will be back to its defaulting ways soon.