Government to sell assets, including new hydro-electric plant near Cuenca, to help pay for coastal reconstruction

President Rafael Correa said Saturday that the government will sell some of its assets to cover the cost of rebuilding coastal communities destroyed by the April 16 earthquake. Among those assets are a new hydro-electric generation plant on the Azuay – Morona Santiago provincial border, Banco del Pacifico, and two television stations.

Sopladora hydro plant control room. (El Tiempo)

“We have decided to sell these assets to rebuild the coast,” Correa said. “We are not only rebuilding physical structures but rebuilding lives too, so this is work that must be done and we will find ways to meet the costs.”

In addition to assets sales, the government has proposed a series of temporary tax increases, including a 2% hike of the national IVA, as well as income taxes. The country has also established lines of credit with the International Monetary Fund and regional banks.

Correa said that the government is also considering selling other assets, including Tame Airlines and Fabrec, a textile and footwear manufacturer. “We are looking into public – private partnerships with such assets as CNT (telecom and Internet provider) and Flota Petrolera Ecuatoriana, an oil transport company.

The Sopladora hydro plant would be the largest sale if it can be negotiated. The plant, scheduled to be completed by July, will be Ecuador’s third largest electricity supplier. The 487 MW plant has been built at a cost of $800 million dollars.