NOVA MEDIA PUBLISHING INC.

The Ecuadorian Crisis

10.10.2019

The government announced a package of economic measures, endorsed by the International Monetary Fund, to alleviate the economic difficulties that were already manifested in a fiscal deficit, a contraction of the economy and negative social indicators.

On Tuesday 1, President Lenín Moreno announced, in national radio and television, the approval of Decree 883, which included the following economic measures:

• Release of the price of diesel and extra and eco gasoline. Before gasoline cost 1.85 dollars per gallon, now it costs 2.39 per gallon. While diesel rose from $ 1.03 to $ 2.29.

• Elimination of import tariffs for cell phones, computers and tablets.

• Reduction of tariffs for machinery, equipment and agricultural and industrial raw materials.

• Increase of 15 dollars in different bonds for approximately 300 thousand families; Until that day the bonus was $40, and the number of families benefited did not exceed 500 thousand.

• Fixed a single Income Tax for banana producers (Ecuador's main export product, after oil).

• Automatic return of taxes to foreign trade.

• Elimination of the advance income tax that companies were obliged to pay in the Andean country.

• Reduction of the Currency Exit Tax (ISD) by half for raw materials, inputs for capital goods, according to a list included in the decree.

• Reduction of the tax on vehicles of less than 32 thousand dollars for productive use, among other measures.

The president received the applause of some business sectors that had raised all this as a fighting platform during the Correa government. But what drew attention and annoyance in the popular sectors was the labor issue.

Moreno said that labor reforms will govern for new contracts, the previous ones will remain intact and decreed:

Occasional contracts in the public service will be renewed with 20% less pay. In addition, public employees will have 15 days of vacation per year (not 30 as they used to have) except those of the Public Force and social services. And something that analysts consider as a setback in rights: public workers will contribute each month with one day of their salary to the State. And he also proposed new hiring modalities for those who start a new venture.

The next day protests began. Transportation services announced the suspension of activities and called for a national strike for Thursday 3. Also, several social organizations and students took to the streets. On the same day, the International Monetary Fund, in a statement, applauded the decisions announced by Moreno and indicated that the reforms are aimed at improving the resilience and sustainability of the Ecuadorian economy, and fostering solid and inclusive growth.

The stop of transportation activities, in almost the entire country, mobilized peasant and indigenous guild organizations to support and chaos reigned on the streets and roads.

The president closed the door for any negotiation and the protest was accentuated in the main road axes of the main cities.

As the hours of Thursday 3 passed, the picture was complicated for the government and at the same time several political and trade organizations announced new actions for Friday 4 and the weekend.

Surprisingly President Moreno declared the State of Exception, an extraordinary measure. “The decisions taken are firm! I have arranged the State of Exception to protect order, citizen security and in order to control those who intend to cause chaos. We will not be blackmailed and will act according to the law,” he said on radio and television.

The announcement of compensation for public transport systems ended the driver's strike and everyone thought that the general protest was over, and Ecuador would return to its routine the following Monday. And that was not the case, since the peasant and indigenous organizations decided, together with some workers' unions, to call for a general strike for Wednesday 9.

The indigenous communities arrived in Quito on Monday 7 and also arrived a dozen of riot cars of the Armed Forces.

The next day, seeing that the protest was expanding throughout the capital and some provinces, Moreno, along with the high military command, announced that the headquarters of the national government was moved from Quito to Guayaquil; He reiterated that he would not back down on the measures taken and explained that he had the support of all public institutions.

And without having pointed it out as an argument at the beginning of the crisis, Moreno denounced an attempted of coup d'etat by the Correist (followers of former President Correa) front.

Until Tuesday 8 it was known that there were 500 people detained according to a report prepared by various human rights organizations. And at the dawn of the same day, the balance indicated that 17 of the 24 provinces of the country were paralyzed by the blockade of roads and citizen and indigenous mobilizations.

That same afternoon, the Pichincha Universal public radio was raided for the alleged crime of inciting discord among citizens.

Meanwhile, at the headquarters of the National Assembly some 2,000 people violently entered the premises and declared themselves "Parliament of the Peoples." The police did not delay in reinforcing the repression and managed to evict the invaders with tear gas bombs and air shots.

At 5:00 p.m. on Tuesday, 8 Moreno approved Decree 888, which prohibits mobility in the surroundings of public buildings and strategic sectors from 8:00 p.m. to 5:00 a.m., Monday through Sunday, and the measure will be in effect while the State of Exception lasts. In other words, a restricted curfew.

On the night of Tuesday 8 the intensity of the protest fell, but violence continued in some sectors of several cities and the number of detainees reached 700, according to Moreno himself in a television interview.

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