Passport demand overwhelms local Civil Registry; Tax receipts plummet; Labor law changes proposed; Lasso denies claims that he will sell government assets

May 31, 2021 | 6 comments

Cuenca’s Civil Registry office has erected barricades outside its historic district office to handle the crowd waiting to apply for passports. Last week, the line at Alfonso Jerves – Manuel Vega office sometimes stretched for three blocks, with some claiming they are spending nights on the sidewalks to keep their place in line.

Part of the line waiting outside Cuenca’s Civil Registry office on Friday. (El Mercurio)

Civil Registry officials say they can only process 600 applications a day but hope to increase the number beginning Monday. The interior ministry announced Friday that hours at the country’s three registry offices that issue passports, including Cuenca’s, will be extended to 7 a.m. to 7 p.m.

An interior ministry spokesman says the rush for passports is the result of high unemployment and pressure to fly out of the country to receive Covid-19 vaccines. “Thousands of Ecuadorians have lost their jobs during the pandemic and many of them want to leave the country to find employment,” he said. “Historically, we are witnessing the greatest demand ever for passports.”

A reporter for television station Telerama confirmed the spokesman’s comment Thursday when he talked to 40 of those waiting for passports. “Almost half of them say they plan to go to the U.S. to find work, although some said they will wait to see if things improve here,” Rodrigo Alvarez said. “A few want to travel to Spain where they have relatives. Ten people told me they want to go to Miami to get Covid vaccines. In general, there are large numbers of very desperate people.”

According a Civil Registry manager, about half the passport applicants are from Azuay Province with the rest coming from surrounding areas.

Tax collections continue to fall
Ecuador’s Internal Revenue Service (SRI) reports that national tax receipts fell 2.15 percent in the first four months of 2021 compared to the same period of 2020. It said that income tax collection fell 3.53 percent while the VAT and special consumption tax income were down 3.78 percent and 3.05 percent. Collection of all taxes dropped 10.55 for all of 2020, the SRI said.

Among the hardest-hit economic sectors are construction, hotels and restaurants and business-support services. Among industries that are seeing growing income are mining, agricultural and private health care

New labor law proposed
Patricio Donoso, Ecuador’s new labor minister, says drastic labor law changes are needed to boost employment and reactive the economy. “There are more than five million Ecuadorians who are unemployed or underemployed and we must generate jobs to get them back to work,” he says. “We have millions more who work in the informal economy and we need to integrate them into the taxation and social services system to improve the quality of their lives.”

Among the proposals in the Labor Opportunities Law, expected to be sent this week to the National Assembly, are a reduction of the bureaucratic process required of employers to hire workers, the allowance of more short-term contract employment and a $500 minimum monthly wage to be implemented over four years. The law would also include incentives for foreign investment in Ecuadorian businesses.

Lasso defends plan to concession some public services
President Guillermo Lasso fired back at critics claiming he intends to sell public assets. “We have no plans to sell off property and services owned by the Ecuadorian people unless it is in their best interest,” the president said Saturday. “What we will do is allow private contractors to bid on managing services and operations where the government lacks the resources or expertise.”

Lasso’s comments were in response to social media comments from several members of the Unes (Correista) National Assembly delegation following an announcement Thursday that the government would put management of the Esmeraldas oil refinery to a public bid.