Ecuador says Brexit ‘spoils’ scheduled bond issue

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Quito | Published: June 26, 2016 7:32:00 AM

Ecuadorean President Rafael Correa said on Saturday that Britain's vote to leave the European Union has "spoiled" a bond issue that had been planned for next week to help shore up the cash-strapped oil-exporter's finances.

brexit vote, china mediaThis year, Ecuador expects to sign a trade agreement with the European Union to expand its traditional non-oil products such as bananas, cocoa and flowers into European markets. (Reuters)

Ecuadorean President Rafael Correa said on Saturday that Britain’s vote to leave the European Union has “spoiled” a bond issue that had been planned for next week to help shore up the cash-strapped oil-exporter’s finances.

Thursday’s “Brexit” vote spooked global markets and spurred a plunge in stock and commodities prices as investors flocked toward safer investments and steered away from riskier securities such as emerging market bonds.

“We were going to launch an issue next week, an issue which was meant to finance the budget,” Correa said during his weekly talkshow. “All this was spoiled by the Eurosceptics’ victory in the referendum in Britain, but we will move forward,” he said, without specifying the amount in question or whether the issue would be rescheduled.

The finance ministry declined to comment.

Authorities have said they planned to issue some $1 billion in bonds this year.

Ecuador, OPEC’s smallest member, is suffering from the effects of low oil prices and a devastating earthquake in April, causing delays in the payment of debts to suppliers and forcing it to slash state spending and investment.

This year, Ecuador expects to sign a trade agreement with the European Union to expand its traditional non-oil products such as bananas, cocoa and flowers into European markets.

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