Masthead graphic based on a painting by Gudrun Thriemer.

Thursday, November 27, 2008

Helga Serrano Narváez, "Ecuador seeks non-payment of illegitimate foreign debt," Americas Policy Program, November 24, 2008.

  Economist Karina Saénz points out that in one projection done by the Commission, it was determined that if the interest rate had been kept at the original rate of 6% the debt would already have been paid off.

Ecuadorian President Rafael Correa announced on Nov. 20 that his government "will seek to not pay the illegitimate, corrupt, and illegal foreign debt," while at the same time demanding sanctions for those guilty of a series of irregularities in the accumulation of the Ecuadorian foreign debt. He said that "its weight should be transferred in equal parts to those who were responsible for acquiring it with dishonesty, blackmail, and betrayal. Each person will have to take responsibility and pay the corresponding amount with their own assets."

This was the Ecuadorian President's response after the official presentation of the final report from the Public Credit Audit Commission (Comision para la Auditoria Integral del Crédito Pública, CAIC) audit regarding Ecuador's foreign debt. It's important to note that this is the first official audit that has ever taken place to determine responsibility for the debt. Among the main conclusions, the Commission pointed out that an "incalculable fraud" was produced during the process of borrowing and renegotiation of the debt. President Correa informed sources that he would promote the creation of an International Tribunal for Arbitration of Sovereign Debt in the United Nations and a reform of the international financial framework, through which it will be possible to arrive at a comprehensive solution to the problem of foreign debt.

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