Ecuador

Correa’s hat-trick

Print edition : March 22, 2013

President Rafael Correa addressing his supporters from the balcony of the presidential palace in Quito on February 17. Photo: GARY GRANJA/REUTERS

In a polling booth in Calderon on February 17. Correa won more than 58 per cent of the votes polled. Photo: GUILLERMO GRANJA/REUTERS

Guillermo Lasso, one of the opposition presidential candidates, at a campaign rally on February 14. Photo: AP

Supporters of Correa and Venezuelan President Hugo Chavez celebrate in Quito. Photo: RODRIGO BUENDIA/AFP

August 19, 2012: WikiLeaks founder Julian Assange at the Ecuadorian Embassy in London. Photo: CARL COURT/AFP

Rafael Correa gets a sweeping mandate for a third consecutive term in the presidential and parliamentary elections in Ecuador.

THE people of Ecuador gave President Rafael Correa a sweeping mandate for a third consecutive term in office in the general elections held on February 16. Correa’s party, Movimiento Alianza Pais (Country Alliance Movement), also won an overwhelming majority in the country’s parliament—according to projections, around 70 per cent of the seats. The President won more than 58 per cent of the votes, thus avoiding a second-round runoff. His nearest opponent was the right-wing business magnate Guillermo Lasso. He got around 23 per cent of the votes. In all there were eight candidates.



Former President Lucio Gutierrez came a dismal third, polling barely 6 per cent of the votes. Gutierrez, a former army officer, had staged a military coup in 2000, overthrowing a civilian government. He then ran for office on a populist platform, but after being elected he reneged on his promises and implemented neoliberal policies dictated by Washington. Widespread street protests in 2005 led to his resignation and the eventual rise of Correa on the national scene.



Correa was first elected President in 2006 and then re-elected in 2009. He has now returned with a stronger mandate to further strengthen the government’s “Citizen’s Revolution” which seeks to change radically the course of politics in the country. Speaking after his decisive victory, Correa said that the results were a clear endorsement of the socialist policies the government had implemented. “You’ve given us the ability to change the country once and for all. Nothing and no one can stop this revolution,” Correa told his cheering supporters from the balcony of his presidential residence. He ended his speech with the ringing words: “We are only here to serve you. Nothing for us, Everything for you.”





War against poverty



Before Correa became President, the Ecuadorian political scene was characterised by chronic instability. Elected governments were not allowed to last their terms. Street protests and extra-constitutional activities ensured that governments came and went in quick succession. Ecuador saw seven Presidents in the 10 years before Correa’s term. The country’s economy, too, was in a precarious state. An economist by training, the 48-year-old Correa won his first election by promising to reverse the neoliberal reforms that were introduced by his predecessor under pressure from international financial institutions. He pledged at that time to wage a war against poverty and has since kept his word.



Correa borrowed from the political lexicon of his friend and mentor Hugo Chavez and said that his goal was to achieve “socialism of the 21st century” in his country. He dedicated his latest victory to Chavez, “the great Latin American leader who has transformed Venezuela”, and wished his friend a “quick recovery” from his cancer surgery.



Nicolas Maduro, the Venezuelan Vice-President, conveyed Chavez’s greeting on the “gigantic victory” Correa achieved in the elections. An official statement from the Venezuelan government said that the results “were a new lesson for those powers which have failed in their attempt to put obstacles in the path towards the consolidation of independence, sovereignty, and well-being of all Ecuadorians”. Cuban President Raul Castro said that Correa’s “clear victory” was the “clear expression of irrevocable support for the citizen’s revolution”. Correa told reporters that in the last six years, there had been only a “destabilising, conspiratorial, coup-pursuing, obstructionist opposition”. The results of the latest elections have shown that the voters have rejected the old opposition.



Correa, along with Chavez and other progressive leaders in the region, has been on Washington’s “hit list”. There were attempted coups against Chavez and Correa in 2002 and 2010 respectively. The Presidents of Honduras and Paraguay, who had wanted to chart alternative courses for their country, were ousted in coups that were supported by the United States.



Correa said he would use his new mandate to usher in more reforms, including laws to reform the country’s media. Influential sections of the media are in the hands of a few oligarchs who are still not reconciled to the new realities. In 2011, a journalist and three executives belonging to an opposition newspaper were found guilty of libelling the President. Prison sentences and a hefty fine were imposed on them. The President pardoned them, saying that his fight was a symbolic one only aimed at “the dictatorship of the media”.



When Correa assumed office for the first time, the country was under a mountain of debt. The country’s elite, which was controlling the government, had subscribed to the “Washington consensus” of deregulation and privatisation. Oil prices had plummeted in the middle of the last decade.



Ecuador is a member of the Organisation of the Petroleum Exporting Countries (OPEC), and oil revenues play a key role in the economy. The global economic recession that started in the last decade did not help matters as it coincided with Correa’s ascent to the presidency. Correa’s deft stewardship, however, ensured that his country did not fall into recession despite the U.S. dollar being Ecuador’s official currency.





Trade links



Ecuador adopted the dollar as its currency in 2000. Most of its trade links at the time were with the U.S. Today, U.S. investments have virtually dried up in the country, and China has emerged as its leading investor. In 2011, China signed an agreement to invest $2 billion in Ecuador. In return, China will be given “priority oil contracts” worth $1 billion. The country is already the biggest buyer of Ecuador’s oil and currently holds $3.4 billion of Ecuadorian debt. Correa recently said that Ecuador welcomed foreign investment but “it is better not to have it than to mortgage the country in the name of that pipe dream called foreign investment”.



In November 2010, Ecuador revised its agreements with most of the Western oil companies. Rental payments were hiked from 18 per cent to 80 per cent. Revenues from the oil sector have helped the government to increase spending in the social sector by 25 per cent. Government revenues rose from 27 per cent of the gross domestic product (GDP) in 2007 to 40 per cent in 2012.



Since 2008, the country has been witnessing tangible changes. The unemployment level, for instance, has been going down steadily. Today, it stands at 4.4 per cent, much lower than in many industrialised European countries. It was Correa’s decision to default on a third of the country’s foreign debt of $3.8 billion, which played a big part in the rebounding of the economy. The government had concluded that this portion of the national debt was illegally contracted. Only 1 per cent of the country’s GDP is now spent on servicing the national debt.



Correa’s progressive policies have produced a high growth in real GDP and a drastic reduction in poverty. Many economists have credited Correa with carrying out the most comprehensive financial reforms any country has witnessed in the 21st century. Among the steps taken were the government’s re-establishing of full control over the central bank and the forcing of the bank to bring back the $2 billion it had in reserves abroad. Many countries in the world continue to hold the independence of their central banks as sacred. The money from the central bank was used to provide loans for infrastructure, housing and agricultural sectors. The government used its newly generated revenues to increase loans to “people’s cooperatives” and other groups that would serve the interests of the public.



High oil prices have no doubt helped the Ecuadorian government to fulfil its pledges of reducing poverty, building new centres of higher education and constructing infrastructure projects that are changing the face of the country. Generous subsidies are provided to various sections of the population. Cash transfers have increased the income of poor Ecuadorians. As many as 1.9 million people out of a population of 15 million receive $50 a month as aid from the state. Most of them are single mothers, needy families and the aged. According to the World Bank, poverty levels in Ecuador have dropped from 38 per cent in 2006 to 29 per cent this year.





Principled stand



President Correa, from the very beginning, has shown that he is not afraid to stand up to the West on the question of principles. Washington was unhappy with him for a variety of reasons. Ecuador’s decision not to renew the lease for the U.S. military base in Manta angered the Bush administration. Correa’s espousal of groupings in the region that excluded the U.S. was another important factor. Ecuador is a founding member of the Bolivarian Alternative for Latin America (ALBA). The other prominent members of the grouping are Venezuela, Cuba and Argentina. Ecuador also plays a leading role in other regional groupings such as the Community of Latin American and Caribbean States (CELAC) and the Union of South American Nations (UNASUR).



Last year, Correa took the courageous step of giving sanctuary to WikiLeaks founder Julian Assange in the Ecuadorian Embassy in London. The Ecuadorian President has reiterated that there is no question of his government compromising on the question of asylum for Assange. He said that the WikiLeaks founder was available for questioning on the premises of the embassy by Swedish prosecutors and that there was no attempt to sidetrack the Swedish justice system. “But there is a lot of arrogance involved here and neocolonial sentiment too. They even want us to backtrack on our decision, but we will never do so,” Correa told a Russian TV channel.



The West and the rest of the world will be hearing and seeing a lot of President Correa as he strides the world stage in the coming years.



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