Ecuador transfers over half of gold reserves to Goldman Sachs to improve liquidity

bloomberg.com/Nathan Gill reported Ecuador agreed to transfer more than half its gold reserves to Goldman Sachs Group Inc. for three years as the government seeks to bolster liquidity. The central bank said it will send 466,000 ounces of gold to Goldman Sachs, worth about $580 million at current prices, and get the same amount back three years from now. In return, Ecuador will get “instruments of high security and liquidity” and expects to earn a profit of $16 million to $20 million over the term of the accord.

THINKING OF MOVING TO ECUADOR? ALREADY LIVE IN ECUADOR? READ THIS BOOK FOR A DEEPER CULTURAL UNDERSTANDING

Ecuador defaulted on about $3.2 billion of bonds five years ago, is attempting to cover a budget deficit which the Finance Ministry has predicted or foretasted to increase to a record $4.94 billion this year. President Rafael Correa stated in April 2014, he plans to sell about $700 million of foreign debt this year in the country’s first international bond sale since the 2008 and 2009 default. Ecuador’s gold reserves fell by $605 million, or 55%, to $493 million in the week ending May 23, according to a report on the central bank’s website Read Article