Archive for the ‘Ecuador’ Category

US GENERAL TO SENATE: TERROR GROUPS BENEFITING FROM LATIN AMERICAN DRUG TRADE

| March 26th, 2015 | No Comments »
Breibart

WASHINGTON, DC — The Iran-backed Lebanese terror group Hezbollah is among the terrorist organizations that are benefiting from the illegal drug trade in Latin America, Lt. Gen. Kenneth Tovo, deputy commander of the U.S. Southern Command (Southcom), told lawmakers.

Illegal drug trafficking in Latin American generates at least “tens of millions” for Hezbollah, which uses the funds to fuel its operations in the Middle East, explained the Southcom general.

During a hearing this afternoon held by the Senate Homeland Security & Government Affairs Committee, Ron Johnson (R-WI), the panel’s chairman, asked the general to comment on the nexus between drug traffickers and terrorist organizations in Latin America.

“Mr. Chairman certainly in a classified setting we can give you a lot more detail. Suffice it to say from open source, I think we know that in at least several occasions over the past decade and a half, terrorists have attempted ... Read More

Cleaning up Latin American democracy

| March 26th, 2015 | No Comments »
The Economist

During the multitudinous demonstration against Brazil’s president, Dilma Rousseff, in São Paulo on March 15th, a lunatic fringe chanted for a return to military rule. That was sad more than worrying. The rightists were shouted down. Their isolation served to underline how routine democracy has become in many Latin American countries in the third of a century or so since the generals returned to barracks.

That outcome was not inevitable. Compared with Europe or North America, democracy in Latin America must struggle against big obstacles, including poverty, gaping income inequality and corruption. Another is poor institutional design. Latin America combines directly elected presidents, as in the United States, with multiparty legislatures chosen by proportional representation, in the manner of many European parliamentary systems. The result has often been gridlock: weak governments have lacked majorities in legislatures unthreatened by dissolution, which induces consensus in parliamentary regimes.

These ... Read More

Ecuador Expects $4 Billion in Loans From China in 2015

| March 24th, 2015 | No Comments »
Wall Street Journal WSJ-01

BY MERCEDES ALVARO

Ecuador expects to receive $4 billion worth of loans this year from different Chinese lenders, of which about $1 billion correspond to disbursements of loans approved last year, a top government official said.

Finance Minister Fausto Herrera said Monday the loans will have a maturity of around eight years.

According to Mr. Herrera, disbursements of Chinese loans have been delayed because or a sharp drop in oil prices in the first months of the year but would begin to arrive next month.

According to unofficial estimates, China has committed more than $12 billion in financing to Ecuador between 2009 and 2014. Most financing operations from China to Ecuador have been tied to oil sales and several have been backed with presales of crude oil.

Mr. Herrera said the new loans aren’t linked with the selling of crude oil.

The minister said despite the decline of around 50% in oil prices, the Andean country plans to maintain ... Read More

Thousands Protest Against Government in Ecuador

| March 20th, 2015 | No Comments »
Wall Street Journal WSJ-01 By MERCEDES ALVARO

QUITO—Thousands of people took to the streets in Quito and at least 12 other cities in Ecuador Thursday to protest against the government of President Rafael Correa, asking for changes in economic, labor and social policies.

Government supporters also gathered in Quito at the traditional Plaza de la Independencia in front of the presidential palace and a few blocks from the Plaza de San Francisco.

Mr. Correa said protests seek to destabilize his government in a difficult economic year due to falling oil prices and the appreciation of the U.S. dollar.

Lower oil prices are expected to drag down economic growth in the country whose oil sector generates about one-quarter of total government revenue and about half of the country’s exports.

President Correa has said his government is prepared to deal with these problems, adding that his government has already done a lot for workers, indigenous and the poor population.

At midday, during the ... Read More

Ecuador slaps new tariffs on one-third of its imports

| March 9th, 2015 | No Comments »
Article originally appeared in Reuters

BY ALEXANDRA VALENCIA

(Reuters) – Ecuador will impose a new set of variable tariffs on one-third of all its imports in an attempt to protect its oil-reliant economy, which has been hit by the plunge in global crude prices, the government said on Friday.

The measure, which begins on Wednesday an extends for 15 months, aims to improve the small Andean nation’s deteriorating trade balance by targeting mainly consumer goods but not its foreign purchases of commodities or capital goods that its industry needs.

The tariffs will range from 5 percent to 45 percent depending on the extent to which products compete with those manufactured locally.

Ecuador adopted the dollar as its currency in 2000, making domestic industry vulnerable to a flood of cheaper imports now that the currencies of several key trade partners have weakened as a result of lower oil prices slashing their export earnings.

The tariffs will make it ... Read More

Ecuador’s Oil Export Revenue Falls 44% in January

| March 9th, 2015 | No Comments »
Wall Street Journal WSJ-01

BY MERCEDES ALVARO

QUITO—Ecuador’s crude oil export revenue totaled $598 million in January, down about 44% from a year earlier, due to lower oil prices, the central bank said on Friday.

Lower oil prices are expected to drag down economic growth, in a country whose oil sector generates about one-quarter of total government revenue and about a half of exports.

Economists say Ecuador’s economy will likely grow between 1% and 2% this year.

The average price of crude oil in January decreased 55% to $41.40 a barrel from the previous year.

In terms of volume, Ecuador exported 11.57 million barrels of crude oil in January, a 25% increase from a year earlier and an increase of about 8% from December. All of the oil was exported by Ecuador’s state-owned companies.

Crude oil is Ecuador’s main export, which the Andean country sends primarily to Asia, the U.S. and the Caribbean.

The central bank also said Ecuador produced 17.29 million ... Read More

Facing up to cheap oil: a tale of Latin America’s two Opec members

| March 3rd, 2015 | No Comments »
Financial Times

By Andres Schipani 

Last week Diezani Alison-Madueke, Nigeria’s oil minister and the president of Opec, called for an extraordinary meeting of the oil exporters’ cartel in the face of falling prices. Rafael Correa, president of Ecuador, Opec’s smallest member, rallied behind her saying prices were “unnecessarily low”.

They may not achieve much – Saudi Arabia and other Gulf exporters are against production cuts – but the calls will nevertheless be welcome in Venezuela, where the sudden collapse of oil prices has been especially bad news.

Rather than hoping for help from its friends, Venezuela might have done more to help itself. As laid out in new report from LatAm Confidential, a Financial Times research service, there is plenty of difference in the way Latin America’s two Opec members have responded to lower oil prices. While Venezuela has done little, Ecuador has adjusted to leaner times.

Embattled Venezuela is more exposed to lower oil ... Read More

Ecuador Will Deal With Oil’s Drop and Dollar’s Rise, President Correa Says

| February 25th, 2015 | No Comments »
Wall Street Journal WSJ-01

By MERCEDES ALVARO

QUITO, Ecuador—President Rafael Correa said Ecuador will implement measures to curb the economic impact of the drop in oil prices and the stronger U.S. dollar, two events that private-sector economists say will hurt growth this year.

“We are taking all measures needed to be prepared. A good economic policy is to make the country less vulnerable to these external factors,” Mr. Correa said during his weekly address broadcast on Saturday.

The price of Ecuadorean crude oil has fallen almost 56%, from $91 in January 2014 to about $40 a year later.

Lower oil prices are expected to drag down economic growth, analysts say, or a country whose oil sector generates about one-quarter of total government revenue and about a half of the country’s exports.

“Ecuador is leaving behind years of prosperity with strong oil prices, in which the state took a leading role in the economy,” said Alberto Acosta, an economist with private ... Read More

Migrants’ remittances to Latin America grew 4 pct. in 2014

| February 24th, 2015 | No Comments »
From Fox News Latino

Expatriates’ remittances to Latin America and the Caribbean increased 4 percent in 2014 to $62.3 billion, the biggest jump since the global economic crisis in 2009, the Inter-American Dialogue, a Washington think-tank, said Tuesday.

The largest gains went to Mexico and Central America, while several South American countries saw a decrease in remittances, due largely to the persistent economic crisis in Spain.

The overall advance in remittances to Latin America reflects improvements in the U.S. labor market, new migration patterns and the proliferation of new ways to transfer money, according to the report.

Remittances to Mexico increased 8.8 percent over 2013, while funds sent to Honduras increased 12.5 percent, and to Guatemala, 9 percent.

The Spanish economic crisis, with high levels of unemployment and falling pay, is largely responsible for decreases in remittances to Bolivia, 2.4 percent; Peru, 2.3 percent, and Colombia, which saw ... Read More

In Ecuador, a rapid decline in press freedom

| February 24th, 2015 | No Comments »
KBIA

BY JASON MCLURE

Many people know Ecuador as the home of calm and picturesque sights, from the Galapagos Islands and lush Amazonian rain forest to soaring Andean peaks.

But the media environment in Ecuador is not so serene. President Rafael Correa, now in his third term of office, regularly files lawsuits against journalists and even cartoonists who mock his government. In his weekly television address, Correa often spends time singling out his critics on social media and is known to tear up copies of newspapers he dislikes. In addition, a communications law passed in 2013 has given the government greater legal powers to fine and censure its critics in the press. Will the situation get worse?

Click here for original ... Read More

Latin America 2015 outlook darkens as commodities sink: poll

| February 13th, 2015 | No Comments »
Article originally appeared in Reuters

BY SILVIO CASCIONE

(Reuters) – Latin America has embarked on a painfully long period of greater austerity, and lower commodity prices and economic growth will barely pick up speed this year, a Reuters poll found Thursday.

With nose-diving oil and metal prices weighing on government finances and jeopardizing investments, economists in the quarterly poll chopped 2015 growth forecasts again for the region’s seven largest countries, from Mexico to Argentina.

Brazil is now expected to grow a meager 0.5 percent in 2015, down from an estimate of 1.1 percent in the prior survey and barely up from an expected 0.2 percent growth in 2014.

Mexico will probably expand by 3.4 percent, compared to 3.7 percent in the last poll, while oil producer Venezuela, flirting with a debt default, will probably contract 2.0 percent, according to the poll of about 50 economists.

Growth would probably improve somewhat in 2016, but would still fall short of the ... Read More

The retreat of U.S. interests from Latin America has left a vacuum for the Chinese to fill

| January 22nd, 2015 | No Comments »
Wall Street Journal WSJ-01 BY ILAN BERMAN You have to feel a bit sorry for the Obama administration. The White House in December announced plans to normalize diplomatic relations with Cuba, including establishing a U.S. Embassy in Havana and formally revisiting Cuba’s status as a state sponsor of terrorism. The move was a clear effort by Washington to distinguish itself in a new international theater.

But that gambit was soon eclipsed by another: In a meeting that could herald a significant shift in the Western Hemisphere’s balance of power, China hosted a high-profile summit earlier this month with the Community of Latin American and Caribbean States, or Celac.

Celac is a relatively recent invention. Conceived in 2010 at a meeting in Caracas hosted by Venezuelan strongman Hugo Chavez , it is designed to deepen integration among Central and South American states—while excluding the U.S. and Canada. The 33-member bloc explicitly styles itself as an alternative to the U.S.-led Organization of ... Read More

Is Ecuador’s president using U.S. law to censor critics?

| January 20th, 2015 | No Comments »
USA TODAY

By Simeon Tegel

LIMA, Peru — You might think that using United States laws to shut up social media opponents would be the last thing Rafael Correa would do.

A vocal adversary of Washington, Ecuador’s leftist president has also made a name for sheltering WikiLeaks’ Julian Assange in his country’s London Embassy, and briefly offering asylum to U.S. intelligence leaker Edward Snowden.

So, it might come as a surprise to learn that Ecuadoreans who dare to post content critical of Correa and his government on Twitter, YouTube and Facebook say they are finding their images and videos systematically targeted and taken down.

Even more unexpected is the justification being given time and again: the supposed violation of the Digital Millennium Copyright Act (DMCA), passed by Congress in 1998.

The law, intended to combat online piracy, holds Internet companies liable for copyright violations they host, however unwittingly. It also establishes a fast track “notice and takedown” process ... Read More

Race on the high seas: Cartels feature new, faster smuggling boats

| January 16th, 2015 | No Comments »
FoxNews.com

By Perry Chiaramonte

Latin America’s drug cartels are leaving the U.S. Coast Guard in their wake, with new and faster speedboats law enforcement officials say are virtually undetectable by radar.

The new boats, nicknamed “Picudas,” after a tropical fish whose long, thin bodies they resemble, are made of fiberglass, making them invisible to radar and efficient with fuel. While older smuggling vessels took as long as three days to make the trip from Costa Rica to Jamaica, the Picuda can make the trip in two.

Dialogo, a newspaper published by the Pentagon’s Southern Command, quoted one Coast Guard source that called the craft “a wave-breaking go-fast wonder that defies radar detection.” The boats give the bad guys a leg up on authorities trying to cut off the flow of South American drugs, according to the article.

“They [cartels] are being forced to do something that they would rather not,” Adam ... Read More

China Rescues Ecuador Budget From Deeper Cuts as Crude Drops

| January 14th, 2015 | No Comments »
Bloomberg

By Nathan Gill

Ecuador, an OPEC nation that relies on crude for about a quarter of revenue, obtained enough financing from China to avoid deeper budget cuts even as its oil price fell below $40 a barrel, Finance Minister Fausto Herrera said.

The Latin American country expects total financing needs for 2015 to rise to about $10.5 billion from a previous estimate of $8.81 billion, Herrera said today in an interview at his office in Quito. The government will use loans from China, multilateral lenders and the nation’s social security agency to help offset a drop in the price of crude, the nation’s biggest export, he said. The ministry isn’t planning to sell international bonds this year after global interest rates rose, he said.

Ecuador’s government announced last week that it would cut $1.42 billion of public spending on items such as new schools and police stations while ... Read More

Latin America 2015: Time for Reform

| January 13th, 2015 | No Comments »
Brookings

By Daniel Zovatto

Latin America is starting off 2015 with a clear economic slowdown. The United Nations Economic Commission for Latin America and the Caribbean (ECLAC) projects a modest recovery (2.2 per cent) with respect to last year (in 2014 growth was only 1.1 per cent, the lowest since the 2009 crisis), though these calculations may vary due to several factors.

The world economy is not helping. The downward trend in raw materials prices, scant dynamism in global demand, and the appreciation of the dollar are three factors that work against the region today.

Venezuela and Argentina, are facing very complex economic contexts. Venezuela is in the midst of stagflation (aggravated by plummeting oil prices); and Argentina is experiencing negative growth, high inflation, and the unresolved conflict with the “vulture funds.”

The two largest economies of the region, Brazil and Mexico, are facing their own demons. Brazil President Dilma ... Read More

Crude Collapse Seen Boosting China’s South American Clout

| January 9th, 2015 | No Comments »
Bloomberg

By Juan Pablo Spinetto and Anatoly Kurmanaev

The worst commodities rout in six years is opening the door for China to increase its influence in Latin America, home to the biggest oil reserves outside the Middle East.

China, with the world’s largest foreign reserves at almost $4 trillion, agreed to a combined $27.5 billion of funding and investment with Venezuela and Ecuador in separate deals announced by South American officials this week in a bid to shore up their battered finances.

As crude’s 50 percent nosedive erodes reserves and funding options of OPEC’s two Latin American members, China, the world’s largest importer of commodities from oil to soybeans, is taking the opportunity to secure more resources in exchange for credit. While details of the accords weren’t divulged, locking in more oil supply to China may reduce the amount the countries have available to sell on the open ... Read More

China steps in to support Venezuela, Ecuador as oil prices tumble

| January 8th, 2015 | No Comments »
Fortune

BY GEOFFREY SMITH

Xi eyes doubling of trade volumes within 10 years and promises $250 billion of investment to Latin America.

China stepped up its courtship of Latin American countries Thursday, promising to double trade with the region by 2025 and offering fresh loans to support left-wing governments in Venezuela and Ecuador.

At a meeting in Beijing with the Community of Latin American and Caribbean States, or CELAC, President Xi Jinping said that annual bilateral trade would rise to $500 billion over the next 10 years, and that China would invest some $250 billion in the region in that period.

That would threaten the U.S.’s traditional pre-eminence as the region’s biggest trading partner, inevitably diluting its political clout there.

However, it’s not clear quite how Xi arrived at his figures. Although trade and investment have rocketed in the last 20 years as China has sucked up natural ... Read More

Ecuador Gains $5.3 Billion Credit Line From China as Oil Tumbles

| January 7th, 2015 | No Comments »
Bloomberg

By Nathan Gill 

The Export-Import Bank of China granted Ecuador a $5.3 billion credit line after a slide in oil to an almost six-year low prompted spending cuts for the OPEC member.

Finance Minister Fausto Herrera said in a statement published today in the president’s official gazette that the Andean nation will use about $1.5 billion of the funds this year to finance public-work projects such as irrigation and transportation. The credit line will have a 30-year maturity and an interest rate of 2 percent, according to the statement.

President Rafael Correa, a 51-year-old former economics professor, traveled to China this week to ask for loans to help prop up public spending after the price of crude, Ecuador’s biggest export, plunged to its lowest level since April 2009. The government announced yesterday that it would cut the 2015 budget by $1.42 billion, or almost 4 percent, because of a decline in ... Read More

Ecuador feels pinch from lower oil as budget cut

| January 6th, 2015 | No Comments »
Financial Times

Another South American nation is feeling the pinch from the falling oil price.

Ecuador, the smallest member of production cartel Opec, has cut its budget for this year by 4 per cent to $34.9bn writes, Andres Schipani, Andes Correspondent.

Oil accounts for more than 50 per cent of exports in Ecuador, and the government has room to cut up to 15 per cent of the budget “to adjust to external shocks.”

The government’s original 2015 budget was based on an average oil price of $79.70 per barrel, which is now far higher than the price of West Texas Intermediate – the benchmark for Ecuador’s oil which trades at a discount because of its lower quality.

WTI fell below $50 a barrel on Monday and is now at its lowest level in five and a half years.

The government is trimming $840m in future investment and $580m in current spending, but finance minister Fausto Herrera stressed the cuts would ... Read More

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