Ecuador's Correa poised for easy re-election win

By Alonso Soto

QUITO (Reuters) - Popular despite a sputtering economy, Ecuador's President Rafael Correa is expected to win a second term in an election on Sunday but he faces tougher times ahead as low oil prices threaten his spending on projects for the poor.

After only two years in office, the socialist Correa is considered the most powerful leader in the OPEC nation's 30-year democracy, with a firm grip on the levers of the economy and on state institutions.

Recent polls show he has about 50 percent support ahead of Sunday's vote, way ahead of his seven rivals. The 46-year-old needs to score more than 40 percent to avoid a run-off vote with the second-placed candidate.

Correa had nearly two years left of his current term, but a new constitution approved last year lets him start again from scratch and the new rules allow presidents two consecutive four-year terms.

Critics fear he is running roughshod over Ecuador's democratic institutions, but Correa is riding high.

"You can either return to the past or continue with the revolution ... it is up to you," Correa told hundreds of poor farmers at a rally on Monday in the Andean city of Ambato.

Voters are also electing members of the National Assembly and a host of regional and municipal officials.

A European-trained economist, Correa has followed the lead of other Andean presidents such as Venezuela's socialist leader Hugo Chavez and conservative Alvaro Uribe of Colombia, who pushed through constitutional changes to extend their rule.

Although more moderate than his main left-wing allies, Chavez and President Evo Morales of Bolivia, Correa has raised spending on education and health, winning the support of a poor majority that was for long neglected in the world's top banana exporter.

Correa has a no-nonsense leadership style and has taken a tough stance with investors, refusing to repay foreign debt. The policies have fanned national pride in a country where many blame foreign interests for perennial poverty.

"Correa has been able to exploit the weaknesses of the opposition and become a leader in a country without any," said top pollster Polibio Cordova. "He will continue with his socialist policies depending on how bad the economy gets."

Falling oil income and financing problems after a debt default in December could encourage Correa to further increase state control of the economy.

But the worsening global crisis may also force him to court companies able to develop Ecuador's gold and copper deposits, and the former Roman Catholic missionary could fast fall from grace if he is unable to meet his promises to protect the poor from a sharp economic slowdown.

"SOMETHING IS CHANGING"

Even as the unemployment rate rises and growth slows, Correa's message of radical change to redistribute oil wealth has allowed him to outlast his last three predecessors, who were toppled by street protests and congressional upheaval.

His main election rivals on Sunday are banana mogul Alvaro Noboa and former president Lucio Gutierrez. They represent a divided opposition and the traditional political parties blamed by many voters for the Andean country's vast inequalities.

"He has been the only one who has worked for us," said Juan Yansapanta, an Indian peasant who climbed down from his Andean hamlet to see Correa at the campaign rally in Ambato. "Something is changing."

The opposition says Correa is amassing too much power.

"We are living in a virtual dictatorship in which Correa holds all power," said Gutierrez, a former army officer toppled by street demonstrations in 2005. "He is a dictator with really bad economic policies."

Gutierrez, who was briefly jailed after his overthrow, accused Correa of ruining the economy by overspending and undermining the U.S. dollar as the country's legal currency.

Although Gutierrez and Noboa trail Correa by a wide margin in polls, they could still harm the president if their allies have a strong showing in the National Assembly elections.

Polls show Correa might not win a outright majority in the 124-member legislature, where traditional political parties have played a role in toppling presidents in the past and have often clashed with the leftist leader.