Ecuador next stop on the gravy train
April 3rd, 2009Ecuador’s Economy Minister Diego Borja announced yesterday that China will lend his country US$1 billion this year to help finance a hydroelectric plant near Quitos. Construction on the project, to be Ecuador’s biggest hydroelectric plant, will begin late this year or early next and last five years.
The checks will start coming from the China Development Bank in two months’ time. You may recall that the CDB – the government’s financing arm for national, and increasingly international, building projects – agreed to lend Brazilian oil giant Petrobras US$10 billion in February. Venezuela got its US$8 billion Chinese investment into a joint-development fund the same week. And then, days ago, the head of China’s central bank announced a US$10 billion currency-swap with Argentina, whose government bonds may be worth next-to-nothing by 2010.
The IMF now has US$1 trillion in its coffers for crisis-stricken countries in need of a loan, but, at this pace, Latin America may do just fine without much of it.