Bilateral "ties really reached a critical point when (last August) there was an inappropriate threat to invade Ecuadoran territory, violating the diplomatic legation, seeking Mr Assange's capture," Ecuadoran Deputy Foreign Minister Marco Albuja said in a phone interview yesterday.
"That was the key moment at which relations were in danger of being broken off," Albuja said as Assange marked a year's limbo in the embassy.
The 41-year-old former computer hacker from Australia, walked into the embassy on June 19, 2012, and claimed asylum in a sensational bid to avoid extradition to Sweden for questioning over alleged sex crimes.
Britain has refused to grant him safe passage to Ecuador.
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Quito, meanwhile, has pressed on in its bid to secure that safe passage for the whistleblower.
And "now there is no real effect on (bilateral) relations, and we have in London, as well as in Quito, a fluid dialogue. Ties are good," Albuja said.
"At no time has Ecuador sought to defy the English or Swedish justice system," Albuja said.
"From the beginning we have said that Mr Assange should face trial. But of course what is being requested is that he not be extradited to a third country where the death penalty is an option and as such his life could be endangered," he added, alluding to the United States.
"We are awaiting Britain's response. Ecuador is not negotiating, Ecuador is having a dialogue," he stressed.