US soft lender to pay Ecuador's Chinese debt to end China telecom role
THE US International Development Finance Corporation (DFC) has agreed help Ecuador repay billions owed to China in exchange for excluding Chinese companies from its telecom networks, reports London's Financial Times
20 January 2021 - 19:00
'DFC was created so that no single authoritarian country had undue influence over another country and we are addressing that factor with this agreement,' said DFC chief executive Adam Boehler.
Mr Boehler and Ecuadorean President Lenin Moreno signed the deal, calling it a 'novel model' to eject China from the Latin American nation.
Under the deal, the DFC will team up with private-sector financial institutions to help create a special purchase vehicle that will buy oil and infrastructure assets in Ecuador.
The sale of the assets will provide Quito with cash to pay off the debt to China earlier than previously agreed - US$3.5 billion will be outstanding after an upcoming repayment is made to Beijing - and also provide money to pump into various development projects.
The DFC is a US federal government foreign aid finance institution, responsible for providing financing of private development projects in lower income countries. It was formed in December 2019 by merging the Overseas Private Investment Corporation (OPIC) and the Development Credit Authority.
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