The people of Ecuador are rising up to refound their country as a pluri-national homeland for all. This inspiring movement, with Ecuador's indigenous peoples at its heart, is part of the revolution spreading across the Americas, laying the groundwork for a new, fairer, world. Ecuador Rising aims to bring news and analysis of events unfolding in Ecuador to english speakers.

Sunday, December 23, 2007

Ecuador sees special credit to prevent any crisis

QUITO, Dec 19 (Reuters) - Ecuador could ask multilateral lenders for a special credit of up to $800 million to be released in case of a future economic crisis due to internal or foreign factors, Economy Minister Fausto Ortiz said on Monday.

Ortiz said the risk credit would protect the economy from a crisis as the leftist government plans to eliminate three saving funds worth about $1 billion in oil revenues.

"If I have a contingency line of this value I'm perfectly covered," Ortiz told Reuters, adding that the credit line could be between $400 million to $800 million.

Ortiz has said the government will soon introduce legislation to eliminate the funds that are earmarked for specific spending and restricted from government control.

He has said the $1 billion held in the savings funds accounts would be used for capital spending on infrastructure and energy projects.

Wall Street analysts worry that such a move could erode the country's savings capacity and make it more vulnerable for external shocks such as a drop in oil prices.

Ortiz did not say which lenders would be asked for the risk loan or specific terms on the credit.

President Rafael Correa, a former economist, has spooked investors with plans to increase state control over the Andean country's economy and natural resources.

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