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ECUADOR
Tough times ahead
1/29/2003
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Gutiérrez takes office promising to combat corruption and poverty.

As Ecuadorans hovered between hope and uncertainty, retired Col. Lucio Gutiérrez took office as president on Jan. 15 for a four-year term. His inauguration was the latest milestone in a meteoric and contradictory political career that began Jan. 21, 2000, with the overthrow of then-President Jamil Mahuad (1998-2000) (LP, May 29, 2000) and reached a climax with his election victory on Nov. 24 (LP, Dec. 2, 2002).

After Mahuad was ousted, Gutiérrez was dismissed from the Army and placed under arrest for six months. Since then, he has dedicated himself to building up the Patriotic Society party, which he founded, and which has attracted former military officers and dissidents from other political groups. Nevertheless, it was the Pachakutik Pluricultural Movement, the political arm of the Confederation of Indigenous Nationalities of Ecuador (CONAIE), that provided the visibility and structure that made Gutiérrez’s candidacy possible.

Gutiérrez, 45, took the helm of a country whose coffers are empty. Ecuador is starting the year with a US$2 billion budget deficit, of which $760 million must be covered by the end of January. Inflation was running at 12.5 percent last year and bank interest rates stand at 16.7 percent, an obstacle to investment and the creation of jobs by new companies.

To cover the budget deficit, on Jan. 19 Gutiérrez announced increases of up to 39 percent in fuel prices, except for cooking gas, a freeze on public employees’ salaries and a 20-percent pay cut for public officials who earn more than $1,000 a month. Some of the measures, which are worth $600 million, drew immediate criticism from indigenous organizations that do not belong to the CONAIE, such as the Federation of Evangelical Indigenous People (FEINE), and other grassroots groups.

To offset the austerity measures, Gutiérrez also announced an increase from $12 to $15 for the monthly "solidarity vouchers" provided to about 1.2 million low-income Ecuadorans (LP, Oct. 29, 1998) and a $5 increase in retirees’ pensions. The president said his economic policy would seek greater contributions from wealthy Ecuadorans while protecting the poor. He added that his goal is to reduce poverty from the current rate of 51 percent of Ecuador’s 12.4 million people to 38 percent by 2007, reduce illiteracy from 10 percent to 8 percent, achieve economic growth of more than 5 percent and reduce inflation to 6 percent.

During his inauguration, Gutiérrez described the country as having a "war economy" and announced a five-point plan based on combating corruption, fighting poverty, ensuring public safety, attracting investment and establishing a sound foreign export policy.

Congressman Marcelo Dotti of the Christian Social Party (PSC) described Gutiérrez’s speech as "emotional, sentimental and lacking concrete proposals." Ramiro Rivera of the Popular Democracy (DP) party added, "There was no clear message about economic policy."

Other observers noted that Gutiérrez’s comments reflected nationalism and a desire to fight corrupt economic powers. One of the new president’s staunchest defenders was Venezuelan President Hugo Chávez. "In his address, Lucio spoke of inequalities, and I do not hesitate to call that a guiding light, because it leads to true structural change. ... It was a revolutionary address," Chávez said. "We are two soldiers who are patriots and who identify, heart and soul, with the people."

One of Gutiérrez’s immediate challenges is to flesh out his plan for governing the country, especially his economic policy at home and abroad, in such a way that it satisfies a diverse constituency. His Cabinet choices reflect the contradictions inherent in the Pachakutik-Patriotic Society alliance that swept him to power with the support of the leftist Democratic People’s Movement (MPD). The Cabinet’s economic bloc is led by Mauricio Pozo, a Quito economist who has worked for the Association of Private Banks of Ecuador and who supported the replacement of Ecuador’s currency, the sucre, with the US dollar — a policy that does not sit well with the indigenous movement.

Angel Polibio Córdova, president of the Association of Economists of Pichincha and director of the Cedatos Gallup polling company, is Gutiérrez’s economic adviser. Ironically, Córdova managed the presidential campaign of Alvaro Noboa, whom Gutiérrez defeated in a runoff. Rounding out the bloc of businesspeople are lawyer Mario Canessa, government and policy minister, who has ties to the banking sector and communications media, and Foreign Trade Minister Ivonne Baky, a businesswoman who has spent more time in the United States than in Ecuador and who was also a candidate in the last election.

The second ministerial bloc consists of members of Pachakutik and the MPD, including Agriculture Minister Luis Macas, Environment Minister Edgar Ish and Nina Pacari, a former congresswoman, who is the new foreign relations minister. Other Pachakutik members hold lower-level posts, including the undersecretary of government, Virgilio Hernández, who has been active in social movements, especially in Quito’s peripheral urban neighborhoods.

The third Cabinet bloc is made up of Patriotic Society members, including intellectuals such as Tourism Minister Doris Solís and Education Minister Rosa María Torres. It also includes former military officers, such as Defense Minister Nelson Herrera, Social Welfare Minister Patricio Ortiz, Public Works Minister Estuardo Peñaherrera and Patricio Acosta, who head the communications office.

"A military alliance with marginalized sectors of society is clearly a good alliance in terms of sovereignty, dignity and quality of life," MPD leader Luis Villacís said.

Gutiérrez’s first stumbling block came with the election of congressional leaders. A battle for leadership broke out after the right-wing PSC ceded its right to preside over the unicameral Congress. Under the Constitution, the party with the most seats holds the presidency; the PSC has 25 of the 100 seats. PSC leaders indicated that they did not want Gutiérrez to blame a PSC-led Congress if his policies fail.

Indigenous legislator Ricardo Ulcuango, however, said the PSC move came after the party failed to gain support for its nomination of former President León Febres Cordero (1984-88) to head Congress. "Since it’s León’s party, it was him or no one — and it ended up being no one," Ulcuango said.

On Jan. 5, lawmakers elected Guillermo Landázuri of the Democratic Left (ID) party as first vice president of Congress and Rivera as second vice president. They then named Landázuri acting president. Gutiérrez threatened to boycott the inaugural ceremony in Congress if lawmakers did not choose a permanent president, however, and on Jan. 9 they formally named Landázuri to the post, sidelining the PSC from leadership for the next four years.

Although the Pachakutik, Patriotic Society and MPD lawmakers constitute the second-largest congressional bloc, they gained control of only two legislative panels, the Indigenous Affairs Commission, led by Ulcuango, and the Commission on Women, Children and the Family, headed by Ximena Bohórquez, Gutiérrez’s wife.

Gutiérrez has a difficult task ahead. He faces the challenge of uniting his colleagues behind his policies and fighting a Congress dominated by the opposition. Meanwhile, Ecuadorans have pinned their hopes on the new president. With Gutiérrez in office, grassroots groups, including the indigenous movement, have assumed responsibility for governing the country, knowing that failure would signify a serious setback in their plans for social change.

 

 


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