Ecuador is to default officially on billions of dollars of foreign debt it considers "illegitimate", says President Rafael Correa.
Mr Correa said he had given the order not to approve a debt interest payment due on Monday, describing the international lenders as "monsters".
The Economist (January 2010):
To finance its budget, the [Ecuadorean] government is likely to have to borrow more than $4 billion this year. Sine defaulting on a third of its foreign debt in December 2008, it has scoured the world for cash, without much success. It was late in paying legislators' salaries last month.
Hah! Another Latin American country exhibiting the wonders (and the impossibility) of building a welfare state at the expense of free-market capitalism (or without free-market capitalism). Like Venezuela, another Latin American country run by a socialist madman, Ecuador went on a spending spree when the price of oil was high. Oil revenue was then allocated to social spending, i.e., buying votes and turning people dependent on the government. Anti-West rhetoric and threats to private companies have not exactly helped government finances, unless you count Hugo Chávez's support, which is not really a good bet in the long run.