October 25, 2024 15:03 GMT
LATAM: IMF Mission to Be Sent to Ecuador on Loan Program Amid Worsening Drought
LATAM
- The news that the IMF will soon send a mission to Ecuador regarding its loan program comes at an important time for the country as the Government continues to deal with low water levels that have caused the reservoirs of hydroelectric plants that cover 70 percent of national demand to fall to critical levels in recent months.
- We noted earlier that Noboa’s administration in Ecuador had decided to lengthen the scheduled electricity rationing from 8 to 14 hours per day due to the worsening drought, with one minister saying the latest schedule would next be reviewed on Sunday.
- Ecuador’s dollar bonds slipped Friday to become the worst performers in emerging markets upon the announcement, with 2030 bonds slipping to the lowest level since mid-August.
- Analysts have noted the blackouts are likely to translate into lower growth, higher unemployment and negatively impact fiscal revenues, while it is also likely to have an impact on the approval rating of the government ahead of a potential re-election bid for President Noboa.
165 words