Protests against sharp austerity measures exploded in Ecuador in early February, forcing the ouster of President Abdala' Bucaram. Two million people mobilized in a 48-hour nationwide strike called by the Frente Patrio'tico (Patriotic Front), a coalition of labor unions, students, women's groups, community, and human rights organizations. Indigenous groups under the Confederation of Indigenous Nationalities of Ecuador (CONAIE) also joined the protest by blocking roads connecting major Andean provinces. Commercial and industrial organizations, and the chambers of commerce participated as well.
In the wake of the two-day strike, Ecuador's Congress dismissed Bucaram February 6 by a vote 44 to 34, declaring him mentally incapable of governing. For a couple of days Vice President Rosali'a Arteaga, initially backed by the military, and Fabia'n Alarco'n, head of Congress, jockeyed for the post of president. Bucaram holed himself up in the presidential palace, declaring the legislature's action illegal. Troops clashed with several thousand demonstrators who tried to get near the palace February 7. One teenager was killed and others were injured.
After some debate, the National Congress voted February 11 to appoint Alarco'n as interim president until new elections in August 1998, and Arteaga acceded. Meanwhile, unable to hold the support of the military, the ousted president left for the coastal city of Guayaquil, where he was previously mayor, and announced a tour through several Latin American countries to denounce the new regime as "a civil dictatorship."
Bucaram, founder of the Ecuadorian Roldosista Party (PRE), took office last August after a campaign in which he demagogically pledged to fight "corruption" and the ruling "oligarchy." Calling himself El Loco, or the Crazy One, Bucaram campaigned with public performances as a singer, dancer, and comedian. He promised to build 200,000 housing units with a 75 percent subsidy during his administration. His rival, Jaime Nebot of the Social Christian Party, made a similar vow.
The president, however, soon began pushing for deep austerity measures. Last December, he announced a package prepared by Domingo Cavallo, former finance minister of Argentina, who was hired by Bucaram as his financial adviser. In 1991, Cavallo introduced harsh economic reforms in Argentina cutting social programs drastically in order to achieve economic growth to satisfy foreign investors. The proposed plan in Ecuador included establishing a convertible currency and a program of sharp cuts in government spending.
Wall Street has demanded restriction in government subsidies in order to meet the international debt payment. Ecuador's foreign debt stands at $14 billion, and the regime needed an accord with the International Monetary Fund to renegotiate its payments, which are $200 million in arrears.
Bucaram's drastic package included devaluing the national currency, the sucre, by 1,000 percent, and fixing it at the exchange rate of 4 sucres to the dollar. This was welcomed by the financiers. "It would give the framework for long-term discipline," Dan Peirce, the "chief emerging- markets strategist" at BostonBank, told the Wall Street Journal, though at a cost of higher unemployment and other hardships for workers.
Bucaram said his plan was needed to bring down the inflation rate, which was 25 percent in 1996, and to increase economic growth. At the same time, he raised taxes for cigarettes and liquor from 15 and 20 percent respectively to 300 percent. The president claimed his program would produce a "new Ecuador," to end a "grave crisis, recession, and widespread corruption."
As part of implementing the austerity program, Bucaram imposed sharp price increases- up to 600 percent- for electricity, cooking gas, and phone services. This ignited a series of protests by workers and students that began January 8 in the capital Quito, and in the cities Cuenca and Guayaquil. Over the next month the mobilizations grew and spread throughout the country, reaching their high point February 5 with the participation of 2 million people - out of a population of 12 million - demanding the resignation of Bucaram and a halt in the austerity drive.
CONAIE also joined the national strike against Bucaram regime. During the February 5 mobilization, indigenous groups blocked highways connecting provinces to the north and south of Ecuador. The affected provinces included Pichincha, Imbabura, Cotopaxi, Tungurahua, Chimborazo, Boli'var, Carchi and Sucumbi'os. The Cuenca-Loja highways were blocked with trees and trenches. In other areas, protesters blocked the roads with other objects.
Indigenous people comprise 45 percent of the Ecuadorian population, and have a history of struggles. In June 1994, CONAIE led a fight against the Agrarian Development Law adopted during the regime of Sixto Dura'n Balle'n. This law, which eliminated communal lands in favor of the big landowners.
The blatant corruption and nepotism of the Bucaram administration, at a time when the president was demanding harsh austerity, added fuel to the protests. During his earlier tenure as mayor of Guayaquil in 1984-85, Bucaram himself faced extortion charges and fled to Panama. A court pardoned Bucaram in 1990, and he returned to Ecuador.
During his six months as president, Bucaram assigned many family members and friends to cabinet posts. His brother Adolfo became Minister of Social Welfare. A close associate, Alfredo Adum, served as Minister of Energy and Mines. Adum, who reportedly made a fortune out of importing merchandise from Panama's Free Trade Zone, was put in charge of privatizing the state-run petroleum industry. Reports that Bucaram's 19-year-old son, Jacobo, garnered millions of dollars from a post in customs also sparked outrage. Bucaram's sister Elsa, also a former mayor of Guayaquil, is now living in Panama, where she fled before resigning in 1991 facing charges of stealing millions.
As the tide shifted against Bucaram, the U.S. ambassador to Ecuador, Leslie Alexander, made a speech January 29 in which he said the governmental corruption was hampering the implementation of economic measures. "Ecuador is gaining a reputation for pervasive corruption," said the ambassador. Citing an example, he went on, "A $12,000 bribe was demanded of a businessman to get an $8,000 container out of customs. News of this sort of mad extortion, which defies even the usual sordid conventions of corruption, reaches international corporations very quickly." U.S. State Department officials said that this observation "played no role" in their decision not to back the president when the Congress voted him out of office.
Since the restoration of civilian government in 1979 under Jaime Roldo's, Bucaram's brother-in-law, successive governments had faced a total of 19 national strikes before the latest actions, demanding better wages and against cuts in social entitlements, according to El Universo, a Guayaquil daily.
An article in the February 11 Wall Street Journal expressed concern that paying off Ecuador's foreign debt "without further popular protests" will now present a "challenge to the country's financial managers."
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