Country is surviving ‘perfect economic storm’ because of smart management, Correa says

Saying that Ecuador earned no income from oil exports in 2015, President Rafael Correa said Saturday that few other governments would have survived the current economic crisis.

President Rafael Correa

“We recognized early last year the difficult economic situation we faced and used smart macroeconomic management to prepare for it,” Correa said during his weekly national televison address Saturday. “We were caught between falling oil prices and a strong U.S. dollar, and we have survived.”

Correa said that Ecuador demonstrated its economic resiliency by paying off an international bond debt last month and by reaching an agreement late last week to pay Occidental Petroleum for a disputed government confiscation of that company’s assets in 2005.

“We have also paid contractors at the end of 2015 and covered expenses to teachers and other groups,” he said. “We did all this with zero income to the government from oil exports.” He added, “We still have debts to pay local governments and this will be done in January and February.”

Correa acknowledged that the country will continue to face hard economic times but says he expects a rebound of oil prices in late 2016. “We are facing the perfect storm, economically speaking, and we cannot expect to get out of it without getting wet. My message to citizens, however, is that we will not sink.”

Last week, Ecuador’s labor ministry said it expected unemployment to rise to 4% or higher in 2016. The rate currently stands at 3.7%.