ECUADOR: RAFAEL CORREA SWORN IN AS PRESIDENT.Rafael Correa Rafael Vicente Correa Delgado (born 6 April 1963 in Guayaquil) is the President of the Republic of Ecuador. A trained economist, he previously served as the country's finance minister. took the oath of office An oath of office is an oath or affirmation a person takes before undertaking the duties of an office, usually a position in government or within a religious body, although such oaths are sometimes required of officers of other organizations. to begin his term as president of Ecuador on Jan. 15, 2007. He laid out plans to reform the Constitution, increase economic productivity, improve social services social services
welfare services provided by local authorities or a state agency for people with particular social needs
social services npl → servicios mpl sociales , reduce the country's crushing debt burden, and further integrate Ecuador into Latin America Latin America, the Spanish-speaking, Portuguese-speaking, and French-speaking countries (except Canada) of North America, South America, Central America, and the West Indies. . One of his first acts was to decree a popular vote on forming a Constituent Assembly A constituent assembly is a body elected with the purpose of drafting, and in some cases, adopting a constitution. An example is the Russian Constituent Assembly, which was established in Russia in the wake of the October Revolution of 1917, which overthrew the Russian Provisional to rewrite Ecuador's Constitution. In naming his Cabinet ministers, Correa made a point to have a strong presence of women in the country's top positions. He also held a symbolic indigenous inauguration where the socialist presidents of Bolivia and Venezuela, Evo Morales Juan Evo Morales Ayma (born October 26, 1959 in Orinoca, Oruro), popularly known as Evo (IPA: [ˈeβ̞o] and Hugo Chavez, were the guests of honor.
"Economic revolution" will reduce debt payments
The US-educated economist assailed Washington's free-market policies in his first speech as president of Ecuador, promising to push for an "economic revolution" that would emphasize renegotiating the country's US$11 billion foreign debt.
One of six leftist left·ism also Left·ism
1. The ideology of the political left.
2. Belief in or support of the tenets of the political left.
left Latin American leaders to win an election or be re-elected in little more than a year, Correa took office pledging a "profound transformation" in Ecuador. Putting on the red, yellow, and blue presidential sash A presidential sash is a cloth sash worn by the presidents of many nations in the world.
The sash is an important symbol of the continuity of the presidency, and is only worn by the president. before cheering supporters in the galleries of Congress, Correa said the policies promoted by Washington since the 1980s failed to help Ecuador develop.
Correa's remarks drew applause from several US antagonists who attended the ceremony--Venezuelan President Chavez, Bolivian President Morales, and Iran's hard-line President Mahmoud Ahmadinejad--as well as from Nicaraguan President Daniel Ortega and more moderate left-leaning leaders from Brazil, Chile, and Peru.
Correa addressed the gathered leaders and said they all now share a new responsibility. "The people won't forgive us if we don't advance the integration of our America," he said.
A political outsider who won election in a November runoff, Correa said he would work for an "economic revolution" in Ecuador that would emphasize renegotiating the foreign debt, "paying only what we can after attending to the needs of the poor."
Correa, 43, who has a doctorate in economics from the University of Illinois University of Illinois may refer to:
During the campaign last year, Correa threatened to cut ties with the World Bank and the International Monetary Fund (IMF IMF
See: International Monetary Fund
See International Monetary Fund (IMF). ) and said he would not rule out a moratorium on foreign-debt payments unless foreign bondholders agree to lower Ecuador's debt service by half. He said in September 2006 that Ecuador could not afford its current US$2 billion debt service, representing 7% of the country's GDP GDP (guanosine diphosphate): see guanine. . "Ecuador cannot pay more than 3%," he said.
Correa did not mention a possible debt moratorium A debt moratorium is a delay in the payment of debts or obligations. The term is generally used to refer to acts by national governments. A moratory law is usually passed in some special period of political or commercial stress; for instance, on several occasions during the in his inaugural speech. A debt renegotiation would not harm Ecuador's economy, but a moratorium would, said Michael Shifter, a Latin America analyst at the Inter-American Dialogue The Inter-American Dialogue (IAD, and also known as "the Dialogue") is a non-profit organization located in Washington, DC. The IAD was begun in 1982, and its website bills the organization as the "premier center for policy analysis, exchange, and communication on issues in Western research group in Washington, DC. "If he goes ahead with it (a moratorium), I don't think it's going to help Ecuador's economy. I think it's certainly going to give the jitters jitters 'Butterflies' Psychology An episode of nervousness or anxiety that often precedes a public event; jitters is a type of performance anxiety which may affect actors in a stage production–stage fright or soloist musicians; it may respond to anxiolytics to Wall Street and the financial community," Shifter said.
Ecuador's bond ratings have fallen to the world's worst since Correa's promised to shave the debt in a manner similar to that of the Argentine government.
Correa said some loans arranged by previous governments had been lost to corruption and an international tribunal should be set up to decide what debt should be repaid. More than 60% of Ecuadorans live in poverty.
"It looks like he is going to play hardball," said Gianfranco Bertuzzi, an emerging-market bond specialist at Lehman Brothers investment bank in New York New York, state, United States
New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of . "Bond holders are bracing for some kind of renegotiation, but what it means is still up in the air."
Bertuzzi said 15 Wall Street firms holding billions of dollars in Ecuadoran debt would meet with Correa's new Finance Minister Ricardo Patino in Quito to find out how Correa planned to proceed with the renegotiation. In February, Correa probably will announce a comprehensive plan, he added.
Patino told a group of investors who visited his office Jan. 17 that much of the country's foreign debt is "illegitimate" and that the government may repay only 40% of it. Patino told the investors that the debt is "a burden on Ecuador that inhibits growth" and takes away from social spending, Citigroup, which arranged the meeting, said in a note to clients. "He argued that for the first time in many years investors will be dealing with a finance minister determined to defend and prioritize social spending over external or domestic debt servicing," Citigroup analysts Don Hanna and Jose Wynne wrote in the report.
Correa also has rejected a free-trade pact with the US, saying it would hurt Ecuador's farmers. And he has said he will not extend the US military's use of the Manta air base Manta Air Base (also known as Eloy Alfaro Air Base) (IATA: MEC, ICAO: SEMT) is a combination civilian airport and military air base on the outskirts of Manta in the province of Manabí in western continental Ecuador. on the Pacific coast for drug surveillance flights when a treaty expires in 2009.
US Commerce Secretary Carlos Gutierrez, who represented the US at the inauguration, said Washington respected Correa's decision to reject the trade deal but hoped to continue "collaboration on matters of mutual interest in the future."
Correa also is expected to push legislation to make foreign oil companies turn over majority interests in their oil fields, taking a cue from Chavez in Venezuela. Legal analyst Diego Delgado of Quito said Correa might also follow Chavez's lead in reversing the privatization privatization: see nationalization.
Transfer of government services or assets to the private sector. State-owned assets may be sold to private owners, or statutory restrictions on competition between privately and publicly owned of some utilities, including telephone, power, and water companies.
Economist Maria de la Paz Vela vela
plural of velum. of Multiplica consultants said Correa is inheriting a reasonably healthy economy growing at a 4% annual rate, with low inflation of 2.8%. The economy got a US$1.1 billion boost from the confiscation confiscation
In law, the act of seizing property without compensation and submitting it to the public treasury. Illegal items such as narcotics or firearms, or profits from the sale of illegal items, may be confiscated by the police. Additionally, government action (e.g. of Occidental Petroleum's oil field in May (see NotiSur, 2006-06-02) and a new hydrocarbon tax that together bumped up Ecuador's total 2006 oil revenue to about US$3.8 billion, she said.
First proposal: Constituent Assembly to rework Constitution
Keeping his campaign promise, Correa decreed a March 18 national referendum on the need for a special assembly to rewrite the constitution. He says the measure is necessary to limit the power of Ecuador's traditional parties, which he blames for the country's instability. Correa ordered the Tribunal Superior Electoral (TSE See Tokyo Stock Exchange.
1. See Tokyo Stock Exchange (TSE).
2. See Toronto Stock Exchange (TSE). ) to "organize, guarantee, and direct" the referendum, which will ask voters, "Do you approve that a Constituent Assembly with full powers in conformity with the electoral statute that is attached be convoked to elaborate a new Constitution?"
The Constituent Assembly would have 89 representatives, 57 representing the country's provinces, 29 representing the nation as a whole, and 3 representing emigrants.
"We seek a profound transformation. Our leadership has failed. We want a democracy where our voice is heard, where our representatives understand that they are there to serve us," Correa said.
The president's plans for an assembly could put him on a collision course with Congress, which is dominated by the traditional parties. The Partido Renovador Institucional Accion Nacional (PRIAN Pri´an
n. 1. (Mining) A fine, white, somewhat friable clay; also, the ore contained in a mixture of clay and pebbles. ) of his main opponent in the election, banana magnate Alvaro Noboa, holds 28 of the 100 seats in Congress while the Partido Sociedad Patriotica (PSP (PlayStation Portable) See PlayStation. ) of former President Lucio Gutierrez (2003-2005) holds 23. Analysts see a constitutional rewrite as Correa's best chance to outflank his opposition's powerful presence in the Congress.
Lawmakers have dismissed the last three elected presidents, including Gutierrez, after the eruption of huge street protests demanding their ousters In Dan Simmons' Hyperion universe, the branch of humanity that left the Worldweb and the Hegemony, and chose instead to travel among the stars, adapting away from planetary life and the influence of the TechnoCore. .
Some Ecuadorans worry that Correa's real goal is to consolidate political power in the presidency as Chavez has done. They say he has shown early signs of not respecting the opinions of his political opponents, even moderate ones. One of Correa's key campaign promises was to give a "correa," or belt, to the widely-reviled traditional political sectors in Quito.
The assembly would have to be approved by the sitting Congress, which effectively would be putting itself out of a job. "Whether it's by consensus, a deal, or through popular pressure, my expectation is that Correa will get his constitutional assembly this year," said Adrian Bonilla, a political scientist at Quito think tank Facultad Latinoamericana de Ciencias Sociales (FLACSO FLACSO Facultad Latinoamericana de Ciencias Sociales ). "It's why he won the election."
Bonilla said he doubts that Correa would use such an assembly to concentrate as much power in his hands as Chavez has done. "Venezuela is different. Here, we are more heterogeneous, more fragmented. I don't think Correa would succeed in what Chavez did," Bonilla said.
US diplomat: "wash out ideology"
Thomas Shannon, the US assistant secretary of state for the Western Hemisphere, claimed that the US wanted to help Ecuador in a Jan. 23 talk to the Center for Strategic and International Studies The Center for Strategic and International Studies (CSIS) is a Washington, D.C.-based foreign policy think tank. The center was founded in 1964 by Admiral Arleigh Burke and historian David Manker Abshire, originally as part of Georgetown University. (CSIS Noun 1. CSIS - Canada's main foreign intelligence agency that gathers and analyzes information to provide security intelligence for the Canadian government
Canadian Security Intelligence Service ), a Washington think tank. "When people want to help you, you should let them help you, as opposed to creating an environment in which there's conflict or confrontation," he said, referring to the possible debt default by the Andean nation. Shannon said US diplomacy should "wash out" ideology and rhetoric to "focus on results."
Yet the past cycle of South American elections has handed win after win to socialists and social democrats, often by margins of victory that have not been seen in decades. US diplomacy in the Shannon mold will be rowing against a strong tide of South American voter support for "ideological" leaders, leaders whose policies have thus far led to strong economic growth in countries like Argentina and Venezuela.
Febres Cordero resigns from Congress
In what seemed to hail a symbolic transformation in the Ecuadoran political stage, Former President Leon Febres Cordero (1984-88)--whose center-right Partido Social Cristiano (PSC (Public Service Commission) Same as PUC. ) long dominated Ecuadoran politics--resigned from Congress and political life, citing unspecified medical problems.
Deputy Alfonso Harb, a top-ranking PSC official, made the announcement Jan. 5 on Febres Cordero's behalf soon after the Congress, elected last October, was sworn in for the new term. "Today the nation bids farewell to the public activity of the country's most important servant over the last 30 years," he told reporters.
Harb said Febres Cordero, 75, made the decision "because of physical ailments and also on medical advice that at this time he cannot be immersed in tense situations that could aggravate his physical condition." Harb did not elaborate. A chain smoker, Febres Cordero is the survivor of five heart bypass operations and two bouts with cancer since his presidential term.
Febres Cordero is a bitter foe of Correa. During his presidency, Febres Cordero became the leading South American ally of US President Ronald Reagan (1981-1989) by embracing free-market policies and criticizing Nicaragua's leftist Sandinista government. But he also counted among his friends Cuba's President Fidel Castro, though the two were ideological opposites.
A wealthy businessman and a power broker nicknamed "the owner of the country," Febres Cordero dominated Ecuador's courts and its fragmented Congress during the last 15 years. In the first round of elections in 2006, the PSC candidate won less than 10% of the vote (see NotiSur, 2006-11-10). [Sources: El Comercio (Peru), 01/03/07; www.venezuelanalysis.com, 01/15/07; Bloomberg, 12/01/06, 12/05/06, 12/13/06, 12/14/07, 01/03/07, 01/18/07; El Universo (Ecuador), 11/15/06, 11/16/06, 12/14/06, 01/15/07, 01/16/07, 01/19/07; El Nuevo Herald El Nuevo Herald is a McClatchy newspaper published daily in Spanish in Miami, Florida, in the United States. The Herald's sister paper is The Miami Herald, also produced by the McClatchy Company. (Miami), 12/12/06, 12/13/06, 01/09/07, 01/10/07, 01/16/07, 01/17/07, 01/19/07, 01/22/07, 01/23/07; The Miami Herald, 01/15/07, 01/16/07, 01/24/07; El Comercio (Ecuador), 11/15-17/06, 12/13/06, 12/14/06, 01/09-12/07, 01/15/07, 01/19/07, 01/22/07, 01/25/07; Associated Press, 11/30/06, 12/29/06, 01/05/07, 01/16/07, 01/17/07, 01/25/07; www.telesurtv.net, 12/14/06, 12/15/06, 12/26/06, 12/27/06, 12/30/06, 01/04/07, 01/08/07, 01/09/07, 01/11/07, 01/15-17/07, 01/19/07, 01/21-25/07]