Ecuador is analyzing the possibility of accessing new loans from China
Photo: Wikimedia Commons.
.jpg){kind=link}
According to a report by the outlet Primicias, within the framework of the China-CELAC Forum, Sariha Moya, Ecuador’s Minister of Economy and Finance, met with at least five banks from the People’s Republic of China with the purpose of analyzing the possibility of new loans that would be used for projects in the road and energy sectors of the South American country.
According to a report from the Ministry of Economy and Finance, these meetings with Chinese banks aim to “strengthen bilateral financial relations and explore new financing opportunities for projects that generate tangible benefits for Ecuadorians.”
Some of the banks with which Minister Moya met during her visit to the People’s Republic of China included the Asian Infrastructure Investment Bank (AIIB), Bank of China, China Development Bank (CDB), Export-Import Bank of China (Eximbank), and the Industrial and Commercial Bank of China (ICBC).
In these meetings, the high-ranking Ecuadorian official presented the most important projects for the government of Daniel Noboa, highlighting the road sector in terms of highways, renewable energies, and technical assistance in energy matters, due to China’s extensive experience in that field. She also emphasized her government’s interest in obtaining financing alternatives through agreements with banks and investors from the Asian country.
These meetings took place in a tense international context due to tariff disputes between the United States and China. Because of this, Washington paid close attention to the various meetings held during the China-CELAC Forum.
One of the major announcements at the forum was the signing of the cooperation plan for the Belt and Road Initiative by Colombia. This event sparked various reactions in the coffee-producing country, including from senior officials of the United States.
Specifically, the U.S. government commented on the matter, stating that “The United States will strongly oppose recent projects and upcoming disbursements by the IDB and other international financial institutions for Chinese state-owned enterprises in Colombia (and other Belt and Road countries) controlled by China, as these projects endanger the security of the region.”
This highlights U.S. concerns about the significant influence the People’s Republic of China is having in Latin American and Caribbean countries through investments and financing in key economic sectors such as energy and critical infrastructure.
The goal of the People’s Republic of China with the Belt and Road Initiative is to develop and expand economic cooperation and connectivity between its nation and countries in Asia, Europe, and some in the Americas, particularly Latin America, through the construction of railways, roads, ports, and investments in strategic sectors such as telecommunications and energy.
Returning to the Ecuadorian case, it is known that the banks with which Minister Moya held these bilateral meetings are the same financial institutions that granted loans to Ecuador between 2009 and 2016, during the government of Rafael Correa, when a significant debt was accumulated, reaching around ten points of the country’s Gross Domestic Product, amounting to at least 9.622 billion dollars in 2016.
However, it is worth noting that after the Covid-19 pandemic, which brought various challenges to the global economy, the banks of the People’s Republic of China reduced the volume of these loans, leading to a restructuring of Ecuador’s debt. As a result, by February 2025, Ecuador’s external debt to China had decreased to 2.560 billion dollars.
Nonetheless, the reduction of this debt does not erase the fact that the Chinese loans during Correa’s government came with conditions that were not favorable to Ecuador and were based on a lack of transparency. A clear example was the oil pre-sales, which were a clause in these loans.
Likewise, the clauses of these Chinese loans to Ecuador between 2009 and 2016 included the execution of infrastructure projects by Chinese companies on Ecuadorian territory. These projects were heavily questioned.
A clear example of such problematic projects was the Coca Codo Sinclair hydroelectric plant, whose construction reached the Ecuadorian Comptroller’s Office due to various concerns, which materialized in the failure to deliver the full energy output that this hydroelectric plant was expected to produce. The issue arose during an electricity crisis in 2024 that caused several blackouts.
Main Source:
Ministra de Economía explora posible acceso a créditos con bancos de China – Primicias Ecuador
Related News:
China and Ecuador open a new trade route
China’s secret police may be operating in Ecuador
You may be interested in:
How Does Debt Affect Ecuador-China Relations? – The Dialogue