The people of Ecuador are rising up to refound their country as a pluri-national homeland for all. This inspiring movement, with Ecuador's indigenous peoples at its heart, is part of the revolution spreading across the Americas, laying the groundwork for a new, fairer, world. Ecuador Rising aims to bring news and analysis of events unfolding in Ecuador to english speakers.

Friday, October 03, 2008

Ecuador sends troops to expel Brazilian company

By Alexandra Valencia

QUITO, Sept 23 (Reuters) - Ecuador expelled a leading Brazilian construction firm on Tuesday, sending troops to seize projects worth $800 million days before a vote expected to extend the leftist president's powers.

President Rafael Correa ordered the government to take over the projects, which include a small regional airport, two hydroelectric plants and a rural irrigation project.

The president is battling with the firm, Odebrecht, over a dam the government says was badly built. His decree accused Odebrecht of "putting public services at risk."

Correa usually enjoys good relations with regional powerhouse Brazil but often uses nationalist measures to drum up domestic support.

Brazil is monitoring the situation, Brazilian Foreign Minister Celso Amorim said, adding that he expects the issue to be discussed and settled during the the next few days.

"We believe Odebrecht is a great company, but obviously we can not prejudge complaints by the government of Ecuador," Amorim told reporters in New York, on the sidelines of the United Nation's General Assembly.

"We understand that Odebrecht has made some offers (to Ecuador) that seemed reasonable to us, at least at first sight," Amorim added.

On Sunday, Correa is expected to win a referendum on a new constitution that will give him greater control over Ecuador's oil-dominated economy and will increase presidential power.

The U.S-trained economist is popular for spending oil wealth on the poor and for his tough policies against large foreign companies and local wealthy elites.

He is aggressively renegotiating contracts with foreign oil and mining companies and only a few days ago persuaded Brazil's state oil company, Petrobras, to abandon an oilfield in the Amazon jungle after clashes over taxes and the ecological impact of the project.

In the past, Correa has sometimes taken positions against foreign companies only to later retreat.

The government has clashed with privately held Odebrecht over the San Francisco hydroelectric dam -- the second largest in Ecuador -- which was completed last year but is not functioning because of damaged machinery. Correa wants the Brazilian giant to pay millions of dollars in compensation.

In Tuesday's decree, he banned Odebrecht officials working in Ecuador from leaving the Andean country.

The move may strain relations with Brazil, which firmly defends the overseas interest of its top companies.

Esteban Michelena, an Odebrecht spokesman in Ecuador, said only one of its projects had so far been taken over by the military and that was two weeks ago.

In a statement, Odebrecht said it had made Ecuador an adequate proposal to fix the problems at San Francisco.

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