From the Economist Intelligence Unit: Posted on Debtonation December 16th

Ecuador’s government will withhold an interest payment on its foreign bonds due on December 15th, making it the first major country to default on its debt obligations since the current global financial crisis began-indeed the first sovereign to do so since Argentina’s huge default of 2001. The president, Rafael Correa, is responding less to deteriorating economic and fiscal conditions than to a belief that much of Ecuador’s debt was contracted illegally. Nonetheless, this move will shut the country off from international credit markets, and could increase risk aversion towards other Latin American borrowers as well.

Read the EIU article here.