Ecuador's leftist Correa promptly begins reforms

Mon Jan 15, 2007

By Christian Oliver and Alonso Soto

QUITO (Reuters) - Leftist Rafael Correa became Ecuador's eighth president in a decade on Monday in a ceremony that drew presidents from a growing anti-U.S. alliance, but the bold reforms he promptly set in motion could imperil his hopes of serving a full term.

Some of Washington's fieriest critics such as Iranian President Mahmoud Ahmadinejad and his Venezuelan counterpart Hugo Chavez came to the world's second-highest capital to show solidarity with the U.S.-educated economist.

After his swearing-in, Correa signed a document calling for a popular vote on March 18 to set up an assembly to change the constitution and accelerate his "citizens' revolution".

"This is the first battle in a long war to retake our country," he told a crowd.

The proposed constitutional changes are meant to lessen the influence of politicians in the judiciary and force legislators to live in the small constituencies that they represent.

Many legislators fear this assembly could be a step towards cutting them out of the political process, raising the spectre of a showdown in the Andean country of 13 million.

Analysts have said such tension in Congress threatened Correa's hopes of serving a full term in the volatile Andean state where three presidents have been ousted in popular and congressional turmoil in the last decade.

Correa has already sent shivers down Wall Street with his promises to renegotiate debt, rework oil deals that he equates with theft and end the lease on a major military base used by the U.S. military.

"I will not negotiate with anyone on the dignity of our homeland. Our homeland is not for sale," he said in his inaugural speech that often quoted Chavez. He wore a traditional Andean shirt and brandished a sword given to him by Chavez.

DEBT PAYMENTS

Correa, who comfortably won a November election run-off against a business magnate, vowed to purge South America's No 5 oil producer of corruption and encourage the return of emigrants.

He also continued his rhetoric against the country's debt payments, saying some of the sovereign debt was "corrupt," and needed international arbitration. He specified the terms of a 2000 debt swap as especially "unacceptable."

The tall, charismatic 43-year-old has promised to challenge the country's political elites who are largely perceived as corrupt. Such a fight could open fault lines in the highly fragile political system of the world's top banana exporter.

Correa's anti-U.S. rhetoric has not been as harsh as that of his Venezuelan counterpart, Chavez.

Although Correa said the devil should feel offended for being compared by Chavez to President George W. Bush at the United Nations in September, the Ecuadorean later called Bush "noble" for congratulating him on his election win.

He also asserted independence from Chavez, insisting, "My friend does not rule in my house, I do."

It appeared earlier this month that Correa's first weeks in power would be tense, with a congressional majority opposing his constitutional reforms.

However, an ousted president who heads parliament's second-largest party threw his weight on Thursday behind Correa, allaying the risk of the new president running into early trouble. He now enjoys a slight majority in Congress.

Raised in a middle-class family in the port city of Guayaquil, Correa won scholarships to study in Europe and the United States. He speaks English, French and a little Quechua, a native language of the Andes.

"We want a profound transformation where the governing classes have failed," he said.