I would bet that a close analysis would find:

a) the coupon on the bonds is a significant drain on the budget, as Ecuador overspent when oil was high and now has to cut spending to reflect much lower oil prices.

b) given the lack of market access/ difficulties cutting its budget/ constraints associated with dollarization, Ecuador will be dipping into its reserves significantly over the next few years if oil follows the WEO trajectory.

c) Ecuador’s incentives to pay are influenced by the fact that it knows that even if it paid it wouldn’t get market access in the near term.

Ecuador strikes me as a classic example of what rogoff called debt intolerance; Ecuador inherited a lot of debt from the 70s/ ran up a lot of arrears from then on creating a large stock without ever actually borrowig much/ never reduced that debt to a level where there is a domestic political consensus to pay in its various restructurings.

then throw in the constraint of dollarization; it cannot devalue to increase the sucre value of its falling dollar revenues from oil, which leaves it with the unpleasant choice of cutting its dollar budget.

one problem with the 99 restructuring was that the coupon on the 2010s and 2030s was not linked to the price oil; there was always an open question whether Ecuador would be able to maintain the political will to pay if/ when oil fell. the fact that ecuador increased spending/ had a big real appreciation in the boom only increased the underlying problem –

this isn’t to say Ecuador is going about this right. It is to say that if a country knows it has to make cuts to pay the coupon on its bonds (or dip into its reserves) and faces a high probability that even it does so it won’t get market access/ be able to borrow/ could end up defaulting, its incentives change –