On July 20, the Ministry of Economy and Finance announced that it had formally presented a proposal for debt rescheduling to the international market, through a Request for Consent and invitation to exchange its ten global bonds for four new bonds (including the interests accrued on bonds between March and August). Bondholders have until July 31, 2020 to vote.

According to the press statement, for the Ecuadorian proposal to become effective, there needs to be a 50% acceptance level of the bondholders over the capital of each bond, and 66% over the aggregate amount of nine global bonds. In turn, the 2024 bond, because it has different clauses, requires 75% approval.

The Government explained that, if accepted, this restructuring would bring major “relief to the country” allowing the State to allocate more resources to managing the health crisis and reactivating the economy. Debt service payment relief is essential for the next five years.