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.

Monday, April 27, 2009

Ecuador's Correa expected to glide to re-election

GUAYAQUIL, Ecuador (AP) — President Rafael Correa's radical transformation of once unstable Ecuador, including a new constitution that would grant him greater powers, is expected to propel the leftist economist to easy re-election on Sunday.

The 46-year-old Correa, who blames the global economic crisis on capitalism's "structural flaws," has spooked foreign investors with a moratorium on debt payments and tough dealings with oil companies and other multinationals.

He has imposed some of the world's strictest protectionist measures to shield local industries, and critics predict that his huge social spending agenda will bust the Treasury as recession takes hold this year.

But it is precisely such actions that have made the U.S.- and Belgium-educated Correa, a little-known economy minister just four years ago, so popular.

"Let's bury the party-docracy," he told supporters Thursday night as campaigning ended, his buzzword for the traditionally corrupt politics-as-usual that he has long eschewed.

Since taking office in January 2007, Correa has tripled state spending on education and health care, doubled to $30 a monthly payment for single mothers and launched subsidy programs for small farmers and people building their own homes.

Luis Ariolfo Hugo, 73, said he's voting for Correa because "he's sincere and has provided what others didn't. He lowered the price of electricity, he gave us subsidies, he's kept all his promises."

Pre-election polls show Correa more than 20 percentage points ahead of his closest rival, former president and coup leader Lucio Gutierrez. Banana magnate Alvaro Noboa, whom Correa defeated in 2006, was running a distant third.

To win without forcing a runoff, Correa needs more than 50 percent of the vote or at least 40 percent with a 10-point margin over his closest competitor.

Under the country's new constitution, approved by 64 percent of voters in a September referendum, Correa would be eligible to run for a second consecutive four-year term in 2013. His current four-year term was automatically truncated by the new constitution.

Voters on Sunday will also choose mayors, governors and a new 124-seat National Assembly. Six of those legislative seats will represent the Ecuadorean diaspora. The new constitution also lowers the voting age to 16 and for the first time permits soldiers, police and prison inmates to vote.

Correa's critics acknowledge his popularity in this Andean nation of 14 million, but warn that like his ally, Venezuelan President Hugo Chavez, he benefited politically from oil prices that skyrocketed last year but have since come down to earth.

Ecuador's oil-based economy grew 6.5 percent last year according to the government, but the country's petroleum revenues have dropped 67 percent in the first quarter of 2009.

Correa's governing model "has been successful in its redistribution of wealth and for directing resources to social programs but not so successful in creating new types of productivity," said Vladimir Sierra, head of the sociology department at Quito's Catholic University.

His most controversial move has been to default on interest payments for 32 percent of Ecuador's $10.1 billion in foreign debt. The government said Monday that it would seek to buy back that debt at 30 cents on the dollar.

"Correa has contributed to Ecuador's isolation, lowering confidence for investment, spurring capital flight, reducing lines of credit and prompting people to turn to the mattress-bank" — keeping their money at home, in cash, said Ramiro Crespo of Analytica Securities.

Many economists believe Correa's policies will force Ecuador to abandon the dollar as its national currency. Ecuador is the world's largest dollar-based economy outside the U.S.

Critics of Ecuador's new constitution complain that the Correa allies who drafted it concentrated more power in the presidency, vesting the chief executive with many budgetary responsibilities that were formerly the province of congress. The central bank's independence was also diminished.

But many analysts say a strong executive is exactly what Ecuadoreans want after so many years of corrupt and inefficient governments. The country has had 10 presidents since 1997 — three of them ousted by popular revolts, including Gutierrez, a former army colonel.

"Correa's success is that he has combined change with order," said Jorge Leon, an independent political analyst. "His government is tough, quite authoritarian, which in the collective imagination confers the idea of order."

Correa has been a particularly demanding boss when it comes to the economy. The current finance minister is his fourth.

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