Ecuador Government: Constituent Assembly Should Keep Dollarization

Thu, Jul 5 2007 FXStreet
Ecuador Government: Constituent Assembly Should Keep Dollarization
QUITO -(Dow Jones)- The Ecuadorean government will propose to the country's future Constituent Assembly that the U.S. dollar be maintained as the legal currency, Interior Minister Gustavo Larrea said Thursday.
Larrea made his remarks at a presentation of the administration's proposal for the revision of the Constitution, which the Assembly will be charged with overhauling. The special assembly will be elected on Sept. 30.
"The dollar should be the legal currency," Larrea said. "We don't have any interest in exiting dollarization, just that this doesn't lead the economy into crisis."
Larrea didn't provide specifics on what he meant by "legal currency," or whether the government is seeking to leave open the possibility of establishing a local currency for Ecuador, as some officials have suggested.
The proposal for constitutional reform seeks to eliminate all possibility of privatizations in Ecuador.
"Exploitation of a state resource can be licensed for a set period of time, but nothing will be privatized," Larrea said.
In the political realm, the government wants the Assembly to revoke the mandates of all authorities elected through popular votes if the officials don't fulfill campaign promises. This authority would encompass not just mayors and local officials, but the president and vice president of the country. Under the proposal, if the president is ousted, the Assembly would also have to disband.
Meanwhile, President Rafael Correa said in a Thursday statement that he is seeking to strip the Central Bank of its autonomy, though he didn't provide details.
Larrea said the government is proposing to give the executive branch power to dissolve Congress one time. The minister said he would like to replace the currently unicameral legislature with two houses. The lower house would be composed of 60 to 70 representatives, and the upper house would have no more than three or four members.
"The idea is to change the structure and also its name," said Larrea, adding that he would favor the moniker "National Assembly."
Larrea added that the government also wants to redraw the electoral map, dividing the country into seven broad regions, two metropolitan districts and a special environmental protection district of the Galapagos Islands. These territories would be governed by a regional authority that would report to a central government minister, Larrea said, without providing more details.
-By Mercedes Alvaro, Dow Jones Newswires; 5939-9728-653; mercedes.alvaro@dowjones.com