CUENCA DIGESTFlooding replaces drought as top concern; electric rationing eases as hyrdo-electric reservoirs fill

Jan 2, 2010

For several days last week, Ecuador turned its concern from drought to flooding, as heavy rains in the Andes caused damage in areas north of Quito and near Cuenca.

The rains are good news for the country’s power grid, as hydro-electric producing reservoirs filled to levels approaching normal. On New Year’s Day, the reservoir at the Paute hydro electric plant near Cuenca was only one meter below normal. The Paute plant generates more than a third of the country’s electricity.

General manager of Corporación Eléctrica del Ecuador, CELEC, Antonio Borrero, announced on Wednesday that the government would not resume blackouts until Monday, Jan. 4, and that it was possible that blackouts could be suspended. “We are watching the water levels at our generation plants and we are hoping the crisis is behind us,” Borrero said.

He added: “Colombia has also received rain and is increasing sales of electricity. We are becoming increasingly more optimistic about the situation.”

Most of Cuenca has seen only two or three days of power cuts since Dec. 22, and those were for periods of only two hours.

Heavy rains caused flooding in Imbabura Province near Ibarra on Tuesday and Wednesday, causing landslides and property damage. Cuenca recorded rainfall as high as four inches and the city’s meteorology station recorded almost three inches between Monday and Wednesday.

The Cuenca neighborhoods of Sinincay and Sayausí, neighborhoods received minor damage to houses and crops from overflowing streams and rivers. In Sayausí, an uninhabited adobe building housing located a few yards from a cemetery collapsed on a car that was parked on the street.

In addition to the rain, the government credited efforts by local governments for helping to reduce the demand for electricity. Most of the country’s towns and cities, including Cuenca, did not put up electrified Christmas decorations this season, and many have reduced use of street lights and other lighting in public places.

U.S. EXTENDS ANDEAN FREE TRADE AGREEMENT FOR ANOTHER YEAR

Ecuadorian officials praised the U.S. Congress’ decision to extend the Andean Nations trade agreement that includes Ecuador. The agreement provides duty-free status to more than 1,200 products made in the country.

Officially called the Andean Trade Promotion and Drug Eradication Act –ATPDEA, by its initials in English– the agreement was extended for a period of one year last week by the U.S. Senate. It was signed Dec. 31 by President Barack Obamba. The act applies to Colombia and Peru as well as Ecuador.

Some of the products affected in Ecuador are flowers, crafts, seafood and agricultural produce. According to the Ecuadorian American Chamber of Commerce, exports to the U.S. amounted to 35 percent of Ecuadorian overseas sales.

"We are pleased that our continuing efforts to persuade this expansion through the U.S. House of Representatives and Senate have been successfully been realized," said Luis Gallegos, Ecuador's ambassador to the United States.

GOVERNMENT DEFENDS MINIMUM MONTHLY WAGE INCREASE

The Ecuadorian government defended Wednesday’s decision to increase the monthly minimum wage by $ 22. Labor groups have accused President Rafael Correa of “reverting to old, neo-liberal justifications” for keeping the increase low.  The government’s new minimum rate is $240. Unions were demanding an increase to $ 320.

Ecuador largest labor union, the United Workers Front (FUT), has announced national protests Jan. 15 to press its case.

Correa says he is sympathetic to the cause of workers but says the increases must come slowly, considering the world-wide recession. “I support a salary of dignity but we must pursue that goal through an organized process.”

He added: "We must be sensible and find a balance between improving wages without destroying jobs. We must also keep our focus on other factors such as working and health conditions.”

PROPERTY TAX COMMITTEE WILL HOLD LINE ON RATE FOR 2010

Property taxes may increase in 2010, but not by much, according to Cuenca’s Committee on Valuation.

A statement issued by the committee noted that now is the not the time to raise taxes. “Considering the economic situation of most taxpayers in these difficult economic times, we are only looking at correcting certain appraisal errors this year, so the amount of tax may increase for some owners. We will not alter the property tax rate of 0.25 on $1,000 of valuation.”

Committee member Lauro López Muñoz said that the emphasis would be on reviewing appraisals for accuracy and collecting overdue taxes, much of it from absentee property owners.

Photo captions: The hydro-electric plant at Paute; President Rafael Correa defending the government's minimum wage increase.

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