Ecuador’s Indigenous Communities Prevail, for Now, Against Moreno’s Austerity Drive

Ecuador’s Indigenous Communities Prevail, for Now, Against Moreno’s Austerity Drive
An anti-government protester waves a national flag in Quito, Ecuador, Oct. 14, 2019 (AP photo by Fernando Vergara).

After nearly two weeks of paralyzing and deadly protests in Ecuador, the streets of Quito rang out in celebration Sunday night. The demonstrations, led by indigenous groups, had succeeded in pressuring President Lenin Moreno to reinstate a popular fuel subsidy he had removed on Oct. 2 as part of an austerity package backed by the International Monetary Fund. “Victory for the popular struggle!” wrote Jaime Vargas, the head of the country’s largest indigenous coalition, the Confederation of Indigenous Nationalities of Ecuador, or CONAIE, on Twitter.

Moreno said the subsidy cuts were necessary under the requirements of a $4.2 billion loan agreement with the IMF struck earlier this year. The removal of the fuel subsidy immediately raised the price of gasoline by over 30 percent and more than doubled the price of diesel. By ending the subsidy, the government had hoped to save about $1.5 billion a year. It is part of an austerity drive that also includes a 20 percent wage cut for new government workers. To offset some of the impact, the government would also expand the number of Ecuadorians who are eligible to receive $15 per month in public assistance.

Ecuador’s economy is struggling. It faces $64 billion in debt, equivalent to more than half of its GDP, and a $10 billion annual budget deficit. The prospects for economic growth look dim. Still, some experts dispute whether it’s really an acute crisis. “There were difficulties, but it was manageable,” Timm Schutzhofer, an expert on Ecuador from Kassel University in Germany, said in an interview.

Keep reading for free!

Get instant access to the rest of this article by submitting your email address below. You'll also get access to three articles of your choice each month and our free newsletter:

Or, Subscribe now to get full access.

Already a subscriber? Log in here .

What you’ll get with an All-Access subscription to World Politics Review:

A WPR subscription is like no other resource — it’s like having a personal curator and expert analyst of global affairs news. Subscribe now, and you’ll get:

  • Immediate and instant access to the full searchable library of tens of thousands of articles.
  • Daily articles with original analysis, written by leading topic experts, delivered to you every weekday.
  • Regular in-depth articles with deep dives into important issues and countries.
  • The Daily Review email, with our take on the day’s most important news, the latest WPR analysis, what’s on our radar, and more.
  • The Weekly Review email, with quick summaries of the week’s most important coverage, and what’s to come.
  • Completely ad-free reading.

And all of this is available to you when you subscribe today.

More World Politics Review