No matter who wins the presidential election, Ecuador is poised for a sharp turn to the right or left

Jan 30, 2021 | 9 comments

Despite a prohibition of walking caravans, supporters of presidential candidate Yaku Perez marched through a Quito neighbohood earlier this week.

By Liam Higgins

The choice in Ecuador’s February 7 election is clear. Voters will choose between bigger government and smaller government and between a return to Rafael Correa’s Citizens Revolution or Guillermo Lasso’s plan to revive the economy through private enterprise. They will also choose between improving relations with the U.S. or turning to China for increased trade and financial assistance.

Although the presidential field has 16 candidates, almost all experts consider the election a two-man race between Correa disciple Andrés Arauz and former Guayaquil banker Lasso, with a consensus of polls giving Arauz the advantage heading into what most believe will be run-off election April 11. Some give indigenous candidate Yaku Pérez an outside chance to edge out Arauz or Lasso for the second runoff spot.

When Lasso recently accused Arauz of being a “front” for Correa, Arauz did not object. “My government will recreate the Citizens Revolution that presided in Ecuador from 2007 until 2017,” he said. “Every decision I make will be in consultation with the architect of that government, Rafael Correa.”

Among Arauz’s campaign promises is to build a bigger central government aimed at “serving the people, especially the poor.” One of his first projects – and the one that has gained the most attention — will be to send a $1,000 to a million poor Ecuadorians, which he says he will finance through a Central Bank purchase of securities from the finance ministry.

Andrés Arauz

Arauz, a 35-year-old economist educated at the University of Michigan and the National University of Mexico, blames Ecuador’s current economic crisis on austerity measures imposed by the Lenin Moreno administration based on conditions of the International Monetary Fund, exacerbated by the Covid pandemic. “What we are experiencing is a self-induced recession brought on by the outside force of the IMF,” he says. “My administration will end the relationship with the IMF and reject the demands they have placed on the economy. Instead of austerity, we will boost growth with increased public spending, higher taxes on the wealthy and capital controls to stop money from leaving the country. I reject the dangerous free market orthodoxy that has brought Ecuador to its knees and will stress internal development and social justice.”

If necessary, Arauz says he will default on IMF and other loans. “We will attempt to make good on them but I will always put the welfare of Ecuadorians first,” he says. “I will follow Rafael’s lead in developing the human capital of this country.” If the country needs financial assistance, he says he will turn to China, not the IMF or the U.S. “China has been a good partner for Ecuador and I will reestablish that relationship when I am in office.”

On other topics, Arauz will “aggressively pursue” a program in increase oil production and mining, recalling Correa’s comment that Ecuador cannot be a poor man sitting on a sack of gold. He rejects demands by environmentalists for more protection of the Amazon and indigenous rights, claiming that oil drilling has left “very small footprints” on the jungle and that indigenous people have, in fact, been consulted on oil and mining projects.

He rejects the need for legislation to legalize abortion, based on Correa’s adherence to the Catholic Church prohibition, and says new legislation to ensure special rights for women and gays must wait until the “rights of all people, especially the poor, are secured and respected,” again based on the Correa’s positions.

Arauz opposes all privatization of public assets and says he will take measures to reaquire those that have been sold during the Moreno administration.

* * *

Guillermo Lasso

In sharp contrast to Arauz, Guillermo Lasso says he is an “unapologetic believer in the power of capitalism, small government and the right for people to prosper without outside interference.” His approach, he says, is the way out the economic crisis and the solution for the country’s high unemployment rate.

A former CEO of Banco Guayaquil, the 65-year-old Lasso is making his third presidential run following defeats to Correa in 2013 and to Moreno in 2017. “I will solve our financial shortfall by promoting private, local and international investment in strategic sectors, to invest in public infrastructure and fully develop the oil, electric generation and telecommunications sectors,” he says. “We will attract high-quality private companies to partner with us to develop a sustainable economic base and to establish good corporate practices that have proven successful throughout the world.”

Lasso says he will work to double Ecuador’s daily output of oil, currently 500,000 barrels. “We have 4.8 billion gallons of proven reserves that we need to tap to help us out of recession and into a prosperous future.”

To improve the lives of Ecuadorians, Lasso says that job creation is the key. “You don’t help the poor by giving them handouts and creating big government and social programs,” he says. “What they need is good jobs and a vibrant economy.”

Although Lasso says he would not default on the country’s debts, he says short-term austerity, not borrowing, is essential. “The so-called austerity of the Moreno administration has not been enough,” he says. “Getting out of the current mess and the coronavirus pandemic require much more discipline. The size of government must be reduced and our priorities must match the essential needs. We must live within our means.”

He adds that he will continue Moreno’s policy of creating stronger ties with the U.S. and distancing the government from reliance on China.

On other topics, Lasso opposes abortion in all cases and says that the Correa and Moreno governments have not been honest with local and indigenous populations in pursing oil and mining projects.

* * *

Yaku Pérez

Cuenca resident and former Azuay Province prefect Yaku Pérez, doesn’t deny that he is laser-focused on ending mining in Ecuador. “I do not ignore the other issues but I do not deny that the fight against mining has been the center of my life in recent years,” he says. “In many ways, mining is a representation of what is wrong with Ecuador today, the fact that the environment and the rights of the people are ignored in the interest of short-term gain.”

Pérez says the estimate by the Correa and Moreno administrations that mining could generate four percent of Ecuador’s GDP is a lie. “It has never amounted to more than one percent and any effort to earn more would be devastating to the environment and to water quality. There are many other sources of revenue that are far less destructive, such as tourism, which currently represents almost two percent of GDP and, if it is promoted, could produce much more.”

Pérez says he is a leftist but shares little in common with Arauz and the Correistas. “I am against a big central government and in favor of distributing authority to the local communities,” he says. “This is where the power and money should go.”

As representative of the Pachakutik indigenous movement, Pérez claims he is fighting for the dignity and preservation of the indigenous people of Ecuador. “Our traditions and our land has been disrespected for hundreds of years and that condition has been maintained during the Correa and Moreno governments. Rafael Correa called us ‘stupid indians’ and my campaign is for ending that prejudice and making the indigenous population a respected and included part of Ecuadorian society.”

On other issues, Pérez favors full abortion rights, a public referendum on oil drilling in the Amazon jungle and maintaining fuel subsidies.

* * *

According to several political analysts, almost all candidates underestimate the impact of the Covid-19 pandemic. “They prefer to campaign on the premise that the pandemic will end when Moreno leaves office and this is almost delusional, in my opinion,” says Jéssica Jaramillo, a former government minister and currently a consultant. “The pandemic is far from over and its effects will be felt well into 2022. Unfortunately, beyond promising money for recovery, the candidates ignore the damage the virus has caused and the work it will take to recover.”

Quito political science professor Simón Pachano says the pandemic is “the elephant in the room” that no one wants to talk about. “It has had a devastating impact on the entire world and probably more so in Ecuador and no one knows what to do about it. It’s easier to minimize the impact and to focus on ideological issues.”