Ecuador: Native Leaders Call for Anti-Government Protests

Written by Gonzalo Ortiz
Monday, 15 March 2010

(IPS) - "This is not the end. It is not even the beginning of the end. But it is, perhaps, the end of the beginning." The words of British Prime Minister Winston Churchill after the 1942 defeat of Germany's forces in Africa are an apt description of the situation between the government of Ecuadorean President Rafael Correa and the powerful Confederation of Indigenous Nationalities of Ecuador (CONAIE).

The alliance of social movements, including indigenous people's organisations, that impelled Correa, then a political novice, to unprecedented victories in two successive presidential elections, the constituent assembly that rewrote the country's constitution, two referendums and a parliamentary election, has clearly come to an end.

At a special assembly in late February, CONAIE decided to launch a "progressive escalation" of anti-government protests, and called on workers and students to join them in rejecting what they called Correa's "neoliberal and colonialist" policies.

The president, who prides himself on having done volunteer work in an indigenous village before going off to university, said the decision was "separatist," and that the indigenous people were "playing into the hands of the (political) right."

In a nationally broadcast address, Correa used harsh terms to describe the indigenous leadership, saying CONAIE head Marlon Santi was not qualified for his position.

Santi "could be a 'teniente político' (a local administrator representing the central government in small towns or villages in Ecuador), something along those lines, but not the president of CONAIE," he said.

Santi's response, in an appearance on the private TV channel Ecuavisa, was that "Correa is sick with his own hatred and vanity." He accused the president of betraying the principles of the alliance that swept him to power. He also said the indigenous movement's protest actions would not become violent.

CONAIE was one of Correa's main allies in the 2006 elections, the 2007 constituent assembly and the latest presidential race in 2009. But a falling-out between them was already evident last year, especially over the issues of mining, oil extraction and water management.

With the aim of attracting foreign investment, particularly from Canada, to exploit the country's copper and gold deposits, the government pushed through a mining law last year creating the state mining company ENAMI and paving the way for huge mining concessions to be granted to Ecuadorean and foreign companies.

CONAIE and other associations that represent indigenous people - who account for nearly 40 percent of the population - as well as environmental organisations felt betrayed, as they believed they had Correa's word that large mining projects would not be allowed.

As for water, the 2008 constitution ordered the legislature to enact a new law on water use and permits, to ensure formal regulation and equitable distribution.

But although the deadline stipulated in the constitution has expired, the bill, which has been heavily criticised by CONAIE, is still winding its way through Congress.

Meanwhile, indigenous communities and their organisations at local and provincial levels are constantly at loggerheads with the Secretaría del Agua, the government body set up to administer water concessions for irrigation.

Oil has also been a source of conflict for years, as drilling in the Amazon has caused severe damages to the jungle territories where indigenous communities have lived for centuries.

Native communities, along with environmentalists and several prominent close allies of Correa - such as Alberto Acosta, who presided over the constituent assembly, and Fander Falconi, foreign minister until February - are angry at the government's policy of allowing oil drilling to continue and opening up the mining industry to foreign companies.

Tension with indigenous groups reached a bitter crisis point in September 2009, when Bosco Wizuma, a high school teacher belonging to the Shuar (or Jivaro) ethnic group, was shot to death during a police crackdown on a demonstration in the Amazon against the government's oil and mining policies.

A truth commission was set up to investigate where the shots came from, with the government alleging they were fired by demonstrators, and indigenous leaders claiming they came from the police. No conclusion has been reached.

Relations with native groups in the country's Amazon region have been further soured by legal action taken by the Superintendencia de Telecomunicaciones, the telecoms authority, against the Shuar Federation's radio station "LaVoz de Arútam", which almost had its broadcasting license suspended because of alleged "incitement to violence."

Mounting indignation within the Confederation of Indigenous Nationalities of the Ecuadorean Amazon (CONFENIAE) has brought pressure to bear on CONAIE's other two regional branches, in the Andean highlands and the coast, to withdraw from the negotiations set up by the government after Wizuma's death.

According to political analyst Pedro Saad, a former member of the Commission on Indigenous Affairs during the government of president Rodrigo Borja (1988-1992), the CONAIE leadership's call for an uprising will not get much response from the country's indigenous people, "at least not in the unanimous, monolithic way they are accustomed to."

The strategy of organising progressive protests is, in Saad's view, a way of playing for time to work with the grassroots indigenous movement, "much of which, especially in the highlands, still supports Correa," he told IPS.

The decision reached at the CONAIE special assembly was a victory for "the point of view of the Amazon indigenous groups. But the vast majority of native people live in the highlands, so I would expect the protests, if they occur, to be strongest in the Amazon region, moderate in the northern sierra, and non-existent in the centre and south of the sierra and along the coast," Saad said.

Meanwhile, university professor Francisco Muñoz, editor of Tendencia, a centre-left political journal, told IPS that the Correa administration is losing its opportunity to represent an important social base.

Worse still, said Muñoz, the government appears to have decided to confront the indigenous movement rather than negotiate with it - the same way it previously dealt with the environmental movement.

"I'm afraid the government is opting for a repressive approach based on the use of force," he said. "If so, Correa will be up against serious difficulties among his own support bloc in parliament, where rifts are already occurring."

Ecuador May Appeal U.S. Court’s Decision in Legal Battle with Chevron

QUITO – The Ecuadorian government may appeal a U.S. court’s decision not to block Chevron from pursuing an arbitration claim against Quito related to a massive environmental lawsuit.

Ecuador’s Attorney General’s Office responded after U.S. District Court Judge Leonard Sand in Manhattan ruled Thursday that an arbitration tribunal in the Netherlands can hear Chevron’s claim that Ecuador’s “exploitation” of an ongoing multi-billion-dollar lawsuit in the Andean nation violated its obligations under a bilateral treaty.

Sand said in his ruling that a “stay of arbitration (requested by Quito) is inappropriate.”

The Ecuadorian government “is considering the possibility of appealing the U.S. court’s decision, clear in the knowledge that Thursday’s decision does not affect Ecuador’s defense in the arbitration proceedings nor amount to a pronouncement on the fundamental issues of the dispute,” the AG office’s statement said.

It added that Ecuador is convinced that “Chevron will continue to lose any (case) involving allegations of misconduct by the government in any forum it chooses to air its claims.”

Chevron said last September that it filed an international arbitration claim against the Ecuadorian government at the Permanent Court of Arbitration in The Hague.

It claimed violations of the country’s obligations under a bilateral U.S.-Ecuador investment treaty in connection with an ongoing $27 billion lawsuit that Amazonian inhabitants have filed against the oil giant for environmental damage.

A lawsuit was first brought against Texaco – which Chevron acquired in 2001 – in a New York court in the early 1990s on behalf of 30,000 Amazon Indians and peasants.

The plaintiffs accused the company of contaminating the ecosystem by dumping billions of gallons of toxic waste from oil-drilling operations, damaging the health of area residents and causing the disappearance of indigenous peoples during the close to 30 years it operated in Ecuador.

A New York court ruled in 2002 that the case should be tried in Ecuador, acting upon a request by Chevron, which said it would abide by any decision handed down in the South American country.

Texaco operated in the Ecuadorian Amazon from 1964 to 1992 as a minority partner in a consortium and was released from any liability for damage by the Ecuadorian government after carrying out clean-up operations.

Chevron accuses state-owned Petroecuador, which took over Texaco’s operations after it left the country in 1992, of responsibility for the environmental damage.

Plaintiffs, however, say that that Texaco’s agreement with the government did not release the company from third-party claims and that Chevron is reneging on its pledge to abide by whatever decision is handed down by a court in the Amazonian town of Lago Agrio.

Chevron says now that the case has become politicized under leftist President Rafael Correa and that the company cannot receive a fair trial.

The company has slammed a report by court-appointed expert Richard Cabrera that Texaco – and Texaco alone – was responsible for all of the environmental damage in the Amazon even though Petroecuador was the majority owner of the Petroecuador-Texaco Petroleum consortium.

Chevron also says that Cabrera went far beyond the scope of his mandate in coming up with the $27 billion figure and that he actively collaborated with the plaintiffs in drawing up the report.

It also claims that he has ties with Petroecuador as the member of an oilfield-remediation company and would stand to gain financially from a ruling against Chevron, yet failed to disclose this information to the court.

Commenting on the Manhattan court’s decision, Chevron’s general counsel, R. Hewitt Pate, said that “only the international arbitration panel can bring Ecuador to the table and compel Petroecuador to do the right thing and clean up its oil fields.”

“With today’s decision, we are one step closer to making that a reality.”

But an attorney for the plaintiffs, American Steven Donziger, said that Chevron’s move to force Ecuador into arbitration was just the last chapter in a series of abuses against the indigenous people of Ecuador.

“Chevron acts like a fugitive from justice in Ecuador because the evidence establishing the company’s misconduct is overwhelming,” Jonathan Abady, another U.S. attorney representing the Amazon communities, said prior to Sand’s ruling. EFE

ECUADOR: Avatar Downfall a Blow for Indigenous Communities

By Gonzalo Ortiz

QUITO, Mar 9, 2010 (IPS) - Science fiction blockbuster Avatar was the big loser in the Oscar awards ceremony - not only a blow for director James Cameron but also seen as a symbolic reverse in the struggle to recover Amazon rainforest areas in Ecuador from the effects of oil pollution.

Several environmental organisations, like the Rainforest Action Network (RAN) and the Amazon Defence Coalition, had asked Cameron to "let his legions of fans know that while Pandora is fictional, what is happening to (indigenous) communities in Ecuador is as real as it gets."

In the film, Pandora, a moon orbiting the planet Polyphemus, comes under threat when human beings decide to extract a mineral essential for energy supply on Earth from its surface.

Rebecca Tarbotton, acting head of RAN, compared Avatar's story-line to the real-life drama of the struggle of Ecuadorean indigenous people who have brought a multi-billion dollar lawsuit for environmental damages against the oil giant Chevron.

After an email campaign last month, backed up by weblog columns and press releases, Tarbotton called on Cameron Sunday morning to make good the promise he had made to use the movie to inspire mass environmental activism.

But Avatar failed to win the Oscars for Best Director and Best Picture, taking awards only in three minor categories out of the nine for which it had been nominated, so Cameron never got a chance to deliver a speech during the American Academy of Motion Picture Arts and Sciences awards ceremony held Sunday in Los Angeles.

Cameron has also been swamped by other requests: Survival International, the movement for tribal peoples, for instance, took out an advertisement in Variety magazine asking him to help the indigenous Dongria Kondh people of India, who are struggling to defend their land against a British mining firm bent on extracting bauxite from their sacred mountain.

At any rate, Cameron need shed no tears over not winning the Oscar, as his movie has already raked in 2.5 billion dollars, making it the greatest box office success in the history of cinema.

What has really lost out is the environmental cause, even as the 16-year-long Chevron trial continues to crawl through the courts.

Speaking of records, this is the biggest class action suit ever launched against a transnational corporation: the indigenous communities of northeastern Ecuador, where the oil drilling took place, are demanding 27 billion dollars in reparations for damages.

The plaintiffs, some 30,000 indigenous people and mestizo (mixed ancestry) settlers, have accused Texaco, a company acquired by Chevron in 2001, of ditching 18 billion gallons of toxic waste water and spilling about 17 million gallons of crude into the rainforest during its operations in Ecuador from 1964 to 1990.

These illegal actions contaminated the soil, groundwater, rivers and streams in the area, causing cancer, congenital defects and abortions among the indigenous population, according to the plaintiffs.

At first Chevron refused to be tried before Ecuadorean courts, so the case was transferred to the United States. However, the U.S. courts ruled that Ecuador did have jurisdiction.

The changes in jurisdiction and various legal manoeuvres by the defence have dragged the trial out for over 16 years.

Since mid-February the new judge presiding over the trial at the provincial court in the northeastern province of Sucumbíos is Leonardo Ordóñez. He replaced Judge Juan Núñez, who Chevron alleged had taken bribes.

"All we ask of Judge Ordóñez is that he enforce the law transparently and impartially, and not allow Chevron to continue delaying the trial," said Pablo Fajardo, lead counsel for the Amazon Defence Coalition, in a statement.

The U.S. oil company's manipulative strategies have included attempting to block the extension of preferential tariffs in the United States for Ecuador's trade goods, as the former Ecuadorean foreign minister, Fander Falconi, confirmed in January.

According to Falconi, in 2009 Chevron's lobby against the renewal of preferential tariffs for Ecuador was "one of the strongest and fiercest that Ecuadorean foreign policy has ever faced."

By hiring law firms and expert negotiators and engaging in intense action on the diplomatic front, the Ecuadorean authorities managed to neutralise Chevron's political and diplomatic influence in Washington, Falconi said before leaving the post of foreign minister.

The import tariffs he referred to are granted by the United States for hundreds of products from Ecuador, Colombia and Peru, in exchange for cooperation in the fight against drug trafficking. Bolivia was also a beneficiary of the scheme until it was excluded last year. (END)

Ecuador May Raise Corporate Taxes to Plug Budget Gap

By Nathan Gill

March 9 (Bloomberg) -- Ecuador may raise corporate taxes to help finance a $4.1 billion budget deficit swelled by the worst drought in 40 years, said Jose Andrade, an economist who works at Banco del Pichincha CA.

Tax revenue could fall by as much as $700 million this year after the drought led to energy rationing, power outages and a decline in hydroelectric power, said Andrade, a Quito-based economist at Pichincha, Ecuador’s biggest bank. He said the views are his own and do not represent those of the bank.

“The government created the budget without thinking about the impact energy shortages would have on productivity,” said Andrade, who also teaches economics at the Universidad San Francisco de Quito. “They will have to improve tax collection any way they can.”

Tax revenue will be less than the government’s $10.2 billion forecast after the drought cut agricultural and industrial output, Andrade said. President Rafael Correa will struggle to spur economic growth by boosting spending after the country’s $3.2 billion debt default in the past year and a half shut it out of international credit markets, he said.

Finance Minister Maria Elsa Viteri was out of the country and unavailable for comment, according to the ministry’s press office.

The drought and power outages that ended in January cost Ecuador about $668 million, according to a report by the Quito Chamber of Commerce. State fuel subsidies to mitigate electricity demand cost an additional $784 million, the report said.

No Proposal

The government and congressional assembly are still discussing the tax and nothing formal has been proposed, Andrade said. Companies would probably pay a flat tax this year and be able to discount part of any increase in their 2011 tax filing, he said.

“The Assembly doesn’t know for sure how much it will raise taxes by,” Andrade said. “But because the president has a majority in the Assembly, there’s a high probability that whatever he proposes would be approved.”

No bill to raise corporate taxes has been proposed or is being discussed, an assistant to Francisco Velasco, the president of the Assembly’s Economic and Tax Commission, who declined to be named because he isn’t authorized to speak publicly. Velasco didn’t respond to a telephone message or e- mailed request for comment.

GDP Growth

The government also overestimated economic growth, said Andrade. The Finance Ministry forecast gross domestic product will grow 6.8 percent this year, according to the budget. That compares with the 2 percent expansion that Andrade predicts.

“The budget is based on increases in state-spending,” Andrade said. “In terms of infrastructure projects, up till now we haven’t seen anything very strong and we’re almost through the first quarter.”

Ecuador has received $550 million in loans this year for infrastructure projects from the Inter-American Development Bank and the Caracas-based lender Corporacion Andina de Fomento, according to a statement on the President’s Web site. The Andean nation received $857.4 million in multilateral financing last year.

--Editors: Lester Pimentel, David Papadopoulos

Ecuador, Iran agree to build 3 hydroelectric centers

QUITO, March 8 (Xinhua) -- Ecuador and Iran agreed to build three hydroelectric centers in Ecuador, the Ecuadorian Presidency's office said Monday.

During an official visit of Ecuadorian Vice President Lenin Moreno to Iran over the last weekend, the representatives of both countries decided to construct three hydroelectric centers in Ecuador by using Iranian technology, with a hydroelectric generation capacity of more than 100 megawatts.

Acknowledging that both countries are geographically far apart, the Presidency's office said that there should nevertheless be more visits between the two countries to enhance bilateral cooperation in trade, investment, tourism, society, culture and sports.

Ecuador and Iran have cooperated in the port, agriculture and auto industries since 2008.

Moreno visited Tehran from Friday to Sunday. His visit aimed to promote the ecological Yasuni-ITT program. The program was launched to forgo the exploitation of oil fields in Ecuador's Yasuni National Park in the Amazon rainforest, in exchange for international funds to support its transition toward a more sustainable economy.

(c) 2010 Xinhua News Agency

Ecuador Says It Has “Plan B” If Yasuni Initiative Fails

QUITO – President Rafael Correa said Saturday his administration has a “plan B” up its sleeve in the event the Yasuni-ITT initiative – a proposal by Ecuador to leave Amazon oil in the ground in exchange for international compensation – is unsuccessful.

In his weekly radio address, he said Vice President Lenin Moreno has begun a tour of Iran, the United Arab Emirates and Turkey to promote the initiative, which seeks to protect the Yasuni Biosphere Reserve in northeastern Ecuador.

Ecuador says that not extracting the estimated 846 million barrels of oil in the ITT field – located within Yasuni, one of the world’s most bio-diverse areas – will prevent the emission of 410 million metric tons of carbon dioxide into the atmosphere.

It has asked the international community to cooperate by contributing an amount equivalent to at least half the revenue that the Ecuadorian government would receive by extracting the oil to the so-called Yasuni-ITT Trust Fund, to be administered by the U.N. Development Program.

Ecuador would then use the money raised for investment in renewable energy projects such as hydroelectric, geothermal, wind and solar power plants.

But Correa said Saturday that his government has a plan B if the initiative falls through.

“We would never want to use it, but if necessary, we will; we’re not going to play around with the wellbeing of the Ecuadorian people,” he said of an alternative option of extracting the oil with “minimum environmental impact.”

Correa said the Petroamazonas oil firm, a unit of state-owned Petroecuador, “is studying the matter” and that a plan is being drawn up to potentially drill in the vicinity of the reserve and recover a large portion of the oil.

Ecuador Hires Korean Firm for Engineering Studies at Refinery

QUITO – The Ecuadorian government has signed an agreement with South Korean firm SK E&C for basic engineering studies at the Refinery of the Pacific, a joint project with Venezuela.

The petrochemical complex, which will be built in the Pacific coastal province of Manabi, is a project being carried out by Ecuadorian state-owned oil company Petroecuador and its Venezuelan counterpart, Petroleos de Venezuela S.A.

Ecuadorian President Rafael Correa, guest of honor at Friday’s signing ceremony, said that with this agreement “the biggest project in the country’s history is becoming a reality.”

The $260 million engineering deal was signed by the manager of the Refinery of the Pacific, Carlos Proaño; the president of Petroecuador, Luis Jaramillo; SK E&C’s legal counsel, Du Yong Choi; and the Asian company’s manager in Ecuador, Ky Ho Hang.

SK E&C Consultores Ecuador, with the backing of parent company SK Engineering and Construction Co. Ltd., is to carry out the basic engineering studies over a period of 18 months.

The South Korean firm also will conduct environmental baseline and conceptual engineering studies for the petrochemical complex, which is expected to come online in December 2013 with a 300,000-barrel-per-day capacity.

In his speech after the contract was signed, Correa said the refinery project will allow Ecuador to put an end “once and for all to the absurdity of exporting oil and importing derivatives.”

“A historic project is coming together,” Correa said, dismissing the “sterile” and “fundamentalist” criticism and debate surrounding the government’s oil policy and the refinery’s potential impact on the environment.

“It’s going to be a very important factor in (the country’s) development and source of employment,” the president said, adding that the project will be carried out with “maximum social and environmental responsibility and maximum efficiency.”

Correa also praised SK E&C as “the leading company in the sector.”

He said it “holds the world record for speed in refinery construction and has the world’s largest refinery. It’s a company with globally recognized reputation and prestige.”

More than $10 billion will be invested in the Refinery of the Pacific project, Correa said, “because it is not just a refinery” but also a petrochemical complex.

According to a statement from the presidential press office, “if the schedule continues to go to plan, expectations are for the construction stage of the project to begin in October of this year.”

The complex will meet Ecuador’s and other Latin American countries’ demand for gasoline, although, due to its geographic location, it is also expected to supply the Asian market.

Despite its status as South America’s fifth-largest oil producer, with output of 480,000 barrels per day, Ecuador is a net importer of gasoline and other derivatives.

ECUADOR:CORREA SUPPORTS FREE NATIONAL PUBLIC HEALTH

NAM NEWS NETWORK Mar 6th, 2010

QUITO, March 6 (NNN-Prensa Latina): Ecuadorian President Rafael Correa has defined the national public health as an avenue ?to provide high quality care, access massive and absolutely free, “because health is not a commodity.”

At the conclusion of an evaluation meeting, he said the efficiency of investments and implementing a new system to facilitate public access to health centers was a way to control various diseases.

“We have more than doubled investment in health, because we believe it is one of the pillars of the Revolution of Citizens, and we believe that conviction is a fundamental human right and a necessity for Good Living,” he said.

Correa stressed that “we can not return to the dark ages when the difference between life death, was a matter of a few dollars.”

He explained that the Public Health System would cover the four systems or the institutions of the Ministry of Health, Social Security, Armed Forces and Police.

“This means a citizen can go to any of these systems and be treated with the same quality and warmth.”

“In about two years this system will be fully integrated and citizens may be served in any of these hospitals,” he stressed.

“It is the constitutional mandate of a single health care system, whose rector is the Ministry of Public Health.”

Much remains to be done in terms of investment and human resources, he said, adding that this year, the government was expected to hire about 7,000 new health professionals.

“We have hired government nearly 13,000 new staff and health professionals though it takes about 12,000 doctors more to meet international standards.?

“There is good progress,” he said, recalling that before 2007 there were no scanners in public hospitals and there are now 23 and about 40 mammography, modern equipment, new hospitals and upgrading of old ones.

-NNN-PRENSA LATINA

Ecuador, Uruguay Launch Oil-for-Gasoline Initiative

By Alvaro Mellizo

JOSE IGNACIO, Uruguay – Ecuadorian President Rafael Correa came to this Uruguayan port town for the launch of an oil-for-gasoline swap between the two countries’ respective energy companies, a program he described as a step toward regional integration.

During Tuesday’s inauguration ceremony at Uruguayan state-owned Ancap’s oil terminal in Jose Ignacio, some 180 kilometers (112 miles) east of Montevideo, Correa witnessed the arrival of the first of seven Ecuadorian crude shipments due over the next several months.

Under the terms of the agreement, Petroecuador will supply Uruguay with 360,000 barrels of crude for which it lacks refining capacity, while in exchange Ancap will provide Ecuador an equal amount of gasoline.

The goal of the evolving accord is to complement each country’s different capabilities and seek mutual benefit, Correa told a press conference.

The Ecuadorian president’s working visit to Uruguay followed his attendance at Monday’s inauguration of leftist Jose Mujica as this country’s new head of state.

Correa said the barter agreement between Ecuador and Uruguay will not only save money but also promote “financial and monetary sovereignty.”

Ecuador produces oil but does not have refining capacity and we were falling into the serious mistake of exporting crude – selling it to intermediaries which sold it at a high price to Uruguay – so that we could buy refined products from the same intermediary,” he said.

“We were giving the money away to transnational intermediaries,” the U.S.-trained economist said.

Under the barter system, with just the first 360,000 barrels that is exchanged, the cost savings for Uruguay – which imports all the oil it consumes – and Ecuador will be $25 million, Correa said.

But he said the biggest benefit for the countries is the boost it will give to “regional planning.”

“If Uruguay has refining capacity and needs crude, and Ecuador has oil and needs gasoline, we need to coordinate and overcome the ridiculous notion they’ve imposed on us that countries have to compete,” the leftist president said.

Joining Correa at the ceremony was Uruguay’s outgoing industry, energy and mining minister, Raul Sendic, as well as the presidents of Ancap and Petroecuador, German Riet and Luis Jaramillo, respectively.

Riet said the lack of regional integration causes Latin America to suffer periodic energy crises even though it is an area of the globe “that produces more energy than it consumes.”

“We’re a country that is dependent on oil and it makes strategic sense to look for it. With this swap, Ecuador is our source of crude,” he said. EFE

Ecuador eyes April deadline for contracts

News wires

Ecuador could assume the operation of oil fields run by private companies if the firms do not sign new contracts with the state in April, Strategic Sectors Minister Galo Borja told Reuters today.

President Rafael Correa wants foreign oil companies to give up their profit-sharing deals and sign new contracts under which they would become service providers.

"At first we said the talks had to be done in March, but at this point we have to be flexible because the deals have to be good for the government," Borja said in an interview in his Quito office.

"We are not worried much because we are capable of replacing any of the companies that do not want to negotiate," he added.

"We would look for a way to negotiate and take those fields ourselves."

"We would not expropriate anything," Borja said in a Reuters report.

"Everything would be negotiated."

Spain's Repsol , Brazil's Petrobras, Chinese consortium Andes Petroleum and Italy's Eni operate in the Andean country, despite Correa's ongoing spats with the private sector.

Correa says Opec-member Ecuador needs to increase control over its own natural resources.

The president alienated the international capital markets in 2008 by defaulting on $3.2 billion in global bonds.

His government had the money to pay the obligations but decided not to, dubbing the debt "illegitimate".

The government argued that the bonds were unfairly contracted years earlier by corrupt officials in league with greedy international bankers.

Don’t Mess with Our People, Ecuador Tells Colombian Rebels

QUITO – Ecuador’s President Rafael Correa told Colombia’s FARC rebels to refrain from aggression against Ecuadorians, a reference to the recent killings of nine of his country’s citizens in the border region.

“I’m sending a very clear warning to the FARC: you’re not going to mess around with Ecuadorian lives here,” Correa said during an interview on Canal Uno television.

Correa said that, according to the scant information available to him, it appears that “nine Ecuadorians and one Colombian have been killed in Tobar Donoso on the Colombian side of the border, and that they were then dumped on the Ecuadorian side.”

“The causes of death and the identity of the perpetrators are being investigated. It appears almost certain that they are from the FARC,” Correa said, adding that he will not tolerate an insurgent group killing his fellow citizens.

The incident comes at a time when Ecuador and Colombia are moving toward restoring diplomatic ties that have been suspended since March 3, 2008, two days after a Colombian military bombing of a FARC camp in the Ecuadorian jungle.

Twenty-six people died in that operation, including FARC No. 2 Raul Reyes, an Ecuadorian citizen and four Mexican college students.

During the interview, Correa recalled the meeting that he had last Monday with Colombian counterpart Alvaro Uribe in Mexico, on the sidelines of the Rio Group summit.

Correa said that during the meeting Ecuador, as the country that was attacked, insisted on compliance with the demands it has made to Colombia as the basis of reestablishing diplomatic ties.

He said that Uribe committed to presenting detailed information of the March 2008 military operation, but that he will do it in Atlanta at the Carter Center, and organization that is lending its good offices to try and mend the broken relations between the two countries.

That information has been demanded by Ecuador from the start, because of the possibility that the United States, Bogota’s patron, might have intervened in the military operation, since at the time it still had a military unit operating from an Ecuadorian airbase.

Correa also recalled that other demands remain pending and said that the process will continue to advance with the next meeting of the Sensitive Issues Commission, which will deal with the most difficult aspects of the controversy between the two governments.

Until those sensitive issues have been discussed, the respective ambassadors will not be designated, Correa said, but in spite of that he stressed that formal relations between the two countries are continuing normally.

In a related matter, Ecuadorian Judge Francisco Revelo declined to pursue a case against former Colombian Defense Minister Juan Manuel Santos and three senior military officers in connection with the March 2008 raid. EFE

Ecuador: Controversy over Drilling for Petroleum in the Amazon

Lisa Ubelaker Andrade,

Huffington Post, Feb 26, 2010

When Ecuador's commission arrived in Copenhagen this fall, it had an audacious environmental proposal for the "developed world": make the conservation of the Amazon as profitable as its exploitation. Ecuador's second term President, Rafael Correa, offered to keep the 900 million barrels of oil that lay deep under the country's Yasuní National Park underground if the developed world would pay 350 million dollars for 10 years, a price comparable to the expected returns for the oil's extraction. The plan offered a model solution: protecting the environment would not be an economic burden for the poorest nations alone. Biological wealth could perhaps become economically profitable. It was idealistic and to many, a long shot. However, to some surprise, it also received abundant international support. By mid-January however, Ecuadorians were left doubting Correa's environmentalism and wondering, what happened? The Ishpingo-Tambococha-Tiputini (ITT) section of Yasuní Park, its ecosystem, and perhaps most importantly, its volunatarily isolated indigenous people, are again in danger of confronting irreversible change.

The ITT oil block lies in the Yasuní National Park in the easternmost region of Ecuador. It is known to environmentalists as one of the most biodiverse places on earth. A recent study conducted by the University of Maryland and the University of San Francisco (Quito) discovered that in a single hectare of Yasuní forest, there are some 100,000 different species of insects, 204 species of mammals, 596 species of birds and 382 species of fish. The forest is also believed to contain the greatest diversity of tree species on the planet.

The ITT sector is also home to humans. The Huaoroni indigenous group has long inhabited the land; so have two separate clans who continue to live in voluntary isolation from the rest of human society. The Tagaeri and Taromenani are two of the last groups on earth known as "un-contacted" peoples: although their longer history is unknown, in recent memory they have succesfully resisted any contact or communication with outside societies.

By preventing oil drilling, the ITT conservation plan would have kept this area protected from the major damage normally caused by such exploits. Drilling creates a contamination of waterways on which species, plants and humans rely. The entrance of oil companies, their colonies and the actual extraction of oil all result in deforestation and the destruction of the habitats. The ITT zone would never be the same. Most grave, the influx of new human diseases would threaten the people living there. Many believe that the Tagaeri and Taromenani lack biological resistance to urban diseases. The arrival of oil personnel would thus not only alter the environment on which these people rely. It would also cause the spread of diseases and, most likely, death.

The ITT plan was intended to avoid these consequences and promote a social agenda. Yolanda Kakbadse, president of the World Wide Fund for Nature (WWF) and a member of the Ecuadorian commission told the New Internationalist a year ago that the funds donated by the developed world would be used "towards objectives which are terribly important for Ecuador and for the planet. The funds would go to ensuring that not just the Yasuní but 40 key conservation areas of Ecuador are protected. And money would go towards addressing poverty at its roots by providing local people with options to benefit economically by using the forest, not by destroying it. So it's a social agenda, a biodiversity agenda and a climate change agenda."

At Copenhagen and beyond the plan was met with success. Germany, Belgium and Spain agreed to support between 972 and 1,232 million dollars and, by January, both France and Sweden were demonstrating interest in the plan.

Before the group could remark on their own success however, Correa, on January 9, called the terms of the agreement "embarrassing." He rejected the donations and further negotiation, unless the northern countries declined any voice in overseeing the use of the funds. Namely, Correa opposed the creation of a joint committee made up of representatives from Ecuador and the donating countries to oversee the donated money's investment. Correa retorted to the donors, "keep your money and in June we will begin to exploit the ITT. We will not give away our sovereignty."

To the Ecuadorian ITT commission the response came as a shock. Kakbadse defended the plan to El Comercio, citing that the concept of a joint committee was created long before because "we wanted to guarantee to the contributors that we were speaking seriously" and that the funds would be used as planned. The commission members restated that the joint committee would enforce the four priorities stated by Ecuador all along: to construct a new energy grid, to conserve and maintain the Amazon environment and the properties and wellbeing of indigenous and afro-Ecuadorian communities, to free Ecuador from fossil fuels by 2020 and finally, to invest in ecotourism and agroforestry projects.

Speculation abounded and rumors circulated, each attempting to explain the 180 degree turn of the government. Was this a move against imperialism, or did Correa simply never foresee the plan working? Were the exploits of oil companies not, too, part of Ecuador's history of imperialism? Hadn't Correa been aware of the ITT plan's for a joint international committee all along? And finally, what of the Amazon's inhabitants, would they have no say in the government's decision?

Head of the commission, environmentalist Roque Silva, announced that "the only failure [of the ITT proposition] was its success." The suggestion reflected a growing doubt: Correa's change in temperament was simply his realization that the idealistic dream might come true. The ITT commission's leaders quit their posts.

Ecuador's foreign minister who had been with Correa since the inception of his political campaign resigned after Correa's comments. He pointed to the oil interests as being at the center of the government's turn-around. "Evidently there are oil interests waiting to drill," he said following resignation.

The debate, the rumors, the raised eyebrows and the sudden lost hope coalesced in a parade of political fallout. The press revealed that preparations for exploitation of the oil were already underway, further questioning the fate of the Amazon region.

As all brace for June--the threatened drill date--Correa has vowed to reinstate a new ITT commission. The commission's new leader, Vice President Lenín Moreno, will travel next month to oil-rich Iran, Dubai and Turkey to seek funds for the ITT initiative.

Meanwhile, the Tagaeri and Taromenani have no notification of the violent disruption looming in the distance. Journalist Milagros Aguirre reported the stressed sentiment growing in the eastern province: "No one knows what to do, we go on without contingency plans, crossing our fingers that here will not come to pass another violent outcome...We are stunned, taking note of the rumors, and the visions, the fears of some and the furies of others. Meanwhile the government takes petals from flowers asking, to exploit? or not? The Tagaeri and Taromenani are circling in the controversies and politics through which their destiny will be decided."

ECUADOR HAILS NEW LATIN AND CARIBBEAN BLOC AFTER CANCUN SUMMIT

NAM NEWS NETWORK Feb 26th, 2010

QUITO, Feb 26 (NNN-PRENSA LATINA) – Ecuador has hailed the establishment of the Community of Latin American and Caribbean States as the most significant and important event taking place in the region.

It shows that times have changed and countries in the region can talk with other regional blocs with the same force, said Ecuadorian Foreign Minister Ricardo Patino.

He said the new entity now requires specificity and it is the job of Foreign Ministers of these countries in the coming weeks to define the proposals to the presidents on the founding document, statues, character and operation mechanism.

There are two upcoming summits, one in Caracas in July next year and another one of the Rio Group in Santiago de Chile in 2012 and hopefully in one of these two meetings we would have all documents ready so that the leaders could sign them, Patino added.

At a news conference to report the results of the recently concluded Summit of Unity in Cancun, Mexico, Patino described it as very successful and said the characteristics of the relationships between countries in the region will now be definitely different.

“Previously we turn our backs on each other and looked towards other blocs but now we look more among us”, he said when explaining the consolidation of the political decision of 32 leaders at the Summit.

Ecuador has defended for years the validity of multilateralism in international relations and the rights that are generated from them get stronger by the existence of strong regional organisations, he said.

This allows for the bloc’s members to resolve their disputes within themselves without having to have the intervention of other countries, he added. — NNN-PRENSA LATINA

Ecuador Backs Rejection to US Blockade in Mexico

Ecuadorian Foreign Affairs Minister Ricardo Patiño highlighted the resolution approved in the Summit of Unity in Cancun, Mexico on the need to finish the US economic, commercial and financial blockade on Cuba immediately.

Ecuadorian Foreign Affairs Minister Ricardo Patiño highlighted the resolution approved in the Summit of Unity in Cancun, Mexico on the need to finish the US economic, commercial and financial blockade on Cuba immediately.

In his statements Thursday before the press, Patiño said that is a demand from the 33 Latin American and Caribbean countries to the US government, for giving a fulfilment to successive resolutions on the topic in the United Nations.

Uninterruptedly since 1992, the UN has approved the favourable vote of almost all its members condemning the US economic blockade against Cuba.

During a balance to the recently concluded Summit of Unity, Patiño announced Ecuador will contribute to the South American fund for the reconstruction of Haiti with 4 million dollars.

The fund is reaching 100 million right now, and 50 percent of the Ecuadorian has already been transferred to Haiti.

Patiño also announced the creation of a commission of three officials for each one of the 12 member countries of the Union of South American Nations (UNASUR) to make the support concrete.

This commission will meet on March 1st and the UNASUR Ministers of Finance and Economy will meet the president of the Inter American Development Bank on March 2nd in Washington for defining a regional credit for 200 million dollars to help Haiti.

Source: Prensa Latina

Ecuador's 3Q Foreign-Direct Investment $128M, Down 58%

QUITO (Dow Jones Feb 25)--Ecuador's foreign direct investment, or FDI, totaled $128 million in the third quarter, down 58% from the $306 million registered in the same period of 2008, the Central Bank said Thursday.

In calculating FDI, the central bank strips out loans made by foreign companies to their Ecuadorian subsidiaries.

The bank said that during the third quarter, $128 million, or 80%, of the investment came from Mexico and went into telecommunications sector.

The key oil and mining sectors received only $25 million during the third quarter.

Mexican investment in Ecuador came primarily from mobile-phone operator America Movil SAB (AMX), which renewed its concession license for 15 years in September 2008. America Movil, which is the leading operator in the Andean country, should pay 3.93% of yearly revenue over the 15-year period.

According to the Central Bank, the services sector saw a net $37 million outflow.

Foreign direct investment in Ecuador totaled $219 million in the second quarter. Between January and September, Ecuador's FDI totaled $469 million.

Analysts said the lack of juridical security, political and economic uncertainty, as well as President Rafael Correa's policies of trying to gain more control over Ecuador's key sectors, make it very difficult to attract foreign investment.

Private Oil Firms in Ecuador to Double Investment in ‘10

QUITO – Private oil companies operating in Ecuador plan to invest more than $417 million in 2010, nearly double last year’s outlay, the Non-Renewable Natural Resources Ministry said Wednesday.

Reports from the National Hydrocarbons Directorate, which oversees oil and gas operations in Ecuador, say that figure corresponds to the 2010 exploration and production budget of six private companies – including Spain’s Repsol YPF – that operate in the Amazon region.

“This sample of six companies demonstrates the result of the government’s actions, which led the private oil companies to increase their investments in the country,” the ministry said.

The Ecuadorian government has been insisting that private oil firms invest more even as they are being forced to relinquish their profit-sharing deals and sign service-provider contracts.

The ministry noted that private oil firms operating in Ecuador invested $212.14 million in 2009, up from $161.84 million the previous year.

Oil is Ecuador’s main export product and revenue from crude exports finances roughly 25 percent of Ecuador’s public spending. EFE