Ecuador assembly opens constitutional reform debate

MONTECRISTI, Ecuador, Nov 29 (Reuters) - An Ecuadorean assembly opened its debate on constitutional reforms on Thursday with President Rafael Correa's controlling majority ready to shut Congress and advance his leftist proposals.

Correa, elected last year as a political outsider promising a citizens' revolution, wants the assembly to curb the powers of discredited traditional parties and beef up state control over the economy of South America's No. 5 oil producer.

The U.S.-trained economist is popular for taking on elites many Ecuadoreans blame for instability that has toppled three presidents in a decade. But his promises to restructure debt, heavy spending and a flagging economy have investors on edge.

"This citizens' revolution is a process that will bring about deep reforms in Ecuador," said Alberto Acosta, a Correa ally who was named president of the 130-member assembly.

Correa's close Andean allies Venezuelan President Hugo Chavez and Bolivia's Evo Morales are also seeking sweeping constitutional reforms that at times have led to violent protests and divided public opinion.

The assembly has six months to draft a new constitution with the option of a 60-day extension. Some pro-government members have said Congress, currently on recess, should close until the charter is drafted and put to a national referendum.

Opposition lawmakers have vowed to stay in office while others say they could take action in international courts.

Correa handed in his resignation to the assembly in a symbolic move to show his independence from members, though the assembly is certain to ratify his presidency.

The initial session was delayed for more three hours as opposition members squabbled over internal rules and procedures at the assembly, where Correa's Alianza Pais party has a 80-seat majority.

A splintered opposition with only a few seats in the assembly says Correa wants to consolidate his presidential powers as Chavez did in Venezuela after his 1998 election. They have promised to try to block any proposals they see as autocratic.