Source:
IFIs Latin American Monitor
Tue Mar 28 2006
The activity of the Commission set to audit the external debt in Ecuador is in suspense. The government gave up this initiative after promoting the setting up of said commission early in February. Many local and international economic interests are at stake which may have questioned this decision. According to Hugo Arias, of the organization Jubilee 2000, the opinion of the IMF was also decisive.
The Commission set to audit the external debt in Ecuador was created by president Alfredo Palacio, in agreement with government minister Alfredo Castillo, early in February. Just over a month later, the resignation of minister Castillo prompted a debate about the interests this commission arises among debt creditors and intermediaries.
According to former minister Castillo, the presidency desisted from continuing with the debt audit. However, a few days later members of the commission received a phone call from the former official stating that the decision to audit the debt was still up and running. This has caused great surprise among the members appointed to the commission, who have decided to give the government some time to define its position on this matter and make public an official version of facts.
Those appointed to make up the commission were: Hugo Arias, Director of the organization Jubilee 2000, Monsignor Luis Luna Tobar, Archbishop of Cuenca, and economists Carlos Cortez, Leonardo Vicuña, Juana Ramos and Eduardo Valencia.
Recently, Hugo Arias, in an interview granted to the newspaper “Expreso de Guayaquil”, pointed out that the decision by president Alfredo Palacio to desist from the audit and give orders to dismantle it, responds to pressures not only from economic groups and Ecuadoran banks but also from the International Monetary Fund (IMF) itself.
Social organizations are currently analysing this issue since the existence of procedures to be audited in connection with the Ecuadoran debt is evident and the government’s change of mind in this sense seems quite revealing.
In this context, members of the commission have decided to meet with 20 social organizations in order to analyse what is going on, explained Arias. If no answer from the government is received by then, the commission will continue with its function all the same.
It should be bore in mind that the volume of the Ecuadoran external debt has grown significantly in the last two decades; and in recent years, the debt load on state expenditures is becoming increasingly heavy. The debt settlement in 2003 amounted to 664 million dollars, in 2004 it reached 905 million dollars, and in 2005 it was increased to 1.04 billion dollars.
On the other hand, upon presenting his resignation, former minister Castillo stated that “Ecuador is ruled by interests which are not precisely popular. (…) The Ecuadoran State has been alienated by a speculative financial apparatus that drives it forward and determines it through the country’s system of indebtedness, its control over oil, resources and geopolitical significance”.
Within this financial apparatus the former minister refers to is the IMF, as a political and economic institution controlled by the world’s wealthiest nations, which exerts an extraordinary influence through the conditionalities attached to its credits.
This is not the first time an attempt to audit the external debt is made in Ecuador. The government of Lucio Gutiérrez had the same initiative but did not manage to set up a commission.
Therefore, we are dealing with an issue that is sensitive to many interests and the IMF has managed to put constant pressure so that everything remains the same. Civil society, for its part, is called to play a key role in the defense of its economic and social rights.
Source: Diario Expreso Guayaquil
Related Information:
The commission set to audit the external debt in Ecuador begins its work
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