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.

Monday, July 28, 2008

Ecuador ex-finance minister criticizes replacement

QUITO, July 15 (Reuters) - Ecuador's new finance minister may endanger the country's debt policies and is unlikely to remain in the post for long, her predecessor Fausto Ortiz said on Tuesday.

President Rafael Correa, who has in the past unnerved markets with warnings he plans to restructure the South American nation's external debt, named economist Wilma Salgado as his new finance minister last week.

Salgado is a member of Jubilee 2000, a group that advocates the cancellation of foreign debt in poor nations.

"She will not be the minister that points out the great risks of taking actions against debts. This is the major worry in the coming weeks while she is in office," Ortiz said in a telephone conference with Wall Street analysts.

Ortiz predicted Salgado would not remain long in the post and said Maria Elsa Viteri, a close ally when he was in office, could replace the current minister.

Ecuador's global bonds, which total about $3.8 billion dollars, weakened on Tuesday after Ortiz's declarations.

During his year in office, Ortiz enjoyed friendly relations with the market and softened Correa's often tough rhetoric.

Salgado promised "life before debt" as she took office, prompting concerns on Wall Street that Correa could revisit plans to default on debt declared illegal by a commission of experts he created last year.

But Ortiz said non-payment was unlikely and that Correa, himself a left-wing economist, had even studied the possibility of a debt buyback.

In the past, the former minister floated the possibility that Ecuador would return to the international debt markets in 2009 to finance the governments social spending commitments.

Analysts believe that Correa's fierce speeches reflect electoral needs as he tries to win voter approval for a new socialist-flavored constitution in a referendum expected in September. Until now Correa has met his debt obligations on time, and his radical words are often contrasted by pragmatic decision making.

Ortiz resigned last week in a disagreement with Correa over the seizure of two television stations and dozens of companies belonging to an Ecuadorean conglomerate.

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