Is Another Pink Tide About to Hit Ecuador?

World Politics Review, 11.02.2021
Frida Ghitis, ex productora de CNN y columnista en asuntos internacionales

A supporter of presidential candidate Arauz holds a portrait of former President Correa, Quito. (AP/Dolores Ochoa)

Ecuador’s presidential election was supposed to be a competition between a leftist candidate in the mold of exiled former President Rafael Correa, and a traditional, center-right and pro-market alternative. But when the votes were counted after Sunday’s first round, voters had delivered a surprise. Ecuadorians could end up with a choice between two leftists, potentially signaling that the coronavirus pandemic has opened the door to a new “pink tide” in South America.

The final outcome of the vote has not been decided and won’t be until the runoff on April 11. The only certainty is that no candidate earned enough votes on Sunday to win outright. The top vote-getter was Andres Arauz, a 36-year-old former minister in Correa’s Cabinet. But the vote for second place is too close to call, and a recount will be required to determine whose name will be on the runoff against him—either the market-friendly conservative Guillermo Lasso, or the Indigenous environmentalist Yaku Perez, who describes his views as “another left,” in contrast with that of Correa and Arauz.

Victory for Arauz, who took 32 percent of the vote in the first round, would likely mark a victory for Correa, who remains in exile in Belgium, a fugitive from the law after he was sentenced to eight years in prison last year on corruption charges and banned from holding public office again. Correa, who was close to Venezuela’s Hugo Chavez, was one of the socialist leaders swept to power in the pink tide of the early 2000s. Like others in that movement, Correa spent lavishly on social programs, raising living standards for the poor on the strength of surging income from oil exports during a commodities boom. And, like others, he displayed strong authoritarian tendencies, removing term limits and seizing ever more power. Correa’s economic model also collapsed when commodity prices fell, like his leftist peers. Ecuador’s economy was left in shambles, with much of its future oil output mortgaged to China to repay loans.

From his exile in Belgium, where his wife is from, Correa declared recently that he is “in perfect synchrony” with Arauz. Although he faces arrest if he returns to Ecuador, he said he would advise his protégé from abroad.

Despite his performance in the first round, Arauz could be hurt by Correa’s embrace. The former president, who still faces 35 more criminal investigations, is enormously popular among some Ecuadorians but reviled by others. In fact, he could even end up costing Arauz the election. But if Perez secures second place in the runoff, the left would take power even if voters repudiate Correa’s man.

The prospect of a left-versus-left election has sent Ecuadorian bonds tumbling on global credit markets. Perez may not be Correa, but much of what he has said has already troubled international investors.

Whoever becomes president will face an economy reeling from the pandemic, with the prospects for recovery made much more difficult by Correa’s legacy. Within months of taking office in 2007, Correa defaulted on the country’s sovereign debt. That sent lenders fleeing. So Correa turned to China, which demanded a commitment of oil supplies from Ecuador’s future output to pay back its loans. Now that the economy has been in free fall, shrinking by about 10 percent in 2020, rising oil prices won’t provide the help Ecuador’s battered economy needs, while most of Ecuador’s oil keeps going to China to pay for the old debts.

Perez’s rise has come as something of a surprise. Indigenous Ecuadorians make up a smaller share of the population than they do in Bolivia, for example, where they powered the rise of former President Evo Morales. An environmental activist, Perez changed his name from Carlos to Yaku Sacha—“mountain water” in his native language of Quechua—and has organized protests against government-backed mining projects since Correa’s presidency.

He doesn’t fit the mold of classic leftists, since he rejects Marxist ideology. But he shares their disdain for international lenders. He has given a cold shoulder to the International Monetary Fund, to which Ecuador owes $6.5 billion, refusing to meet with IMF officials, vowing not to pay back what he calls “illegitimate debt.” He even said he would tear up the loan agreement reached between the IMF and outgoing President Lenin Moreno. As his prospects for victory started looking up, however, he offered some reassurance that he would respect the country’s commitments to the IMF.

Foreign investors are torn. While their favorite candidate is Lasso, a former economy minister, some worry that a head-to-head matchup between Lasso and Arauz would open the door to what they view as the worst option: a Correa 2.0 administration. With their fingers crossed, they hope that Perez, if he wins, would prove more conciliatory than some of his statements on the campaign trail.

Like other countries in Latin America, Ecuador has been pummeled by the coronavirus. The experience in Guayaquil, its largest city, was an early sign of how tough the public health crisis would be. Authorities there were so overwhelmed early in the pandemic that they couldn’t keep up with collecting dead bodies, which piled up on city sidewalks.

Added to the existing economic difficulties, the pandemic derailed efforts by Moreno to stabilize the economy last year. Moreno’s austerity measures crushed his popular standing, laying a path for a potential return of correismo, Correa’s brand of populism.

To Correa, Moreno is “the greatest traitor in Ecuadoran and Latin American history,” and it’s personal. Moreno had been an ally of Correa’s, as his vice president, before turning against him in an anti-corruption campaign once he succeeded him in office.

As president, Moreno also wanted to reverse the autocratic slide of the Correa years. He declined to run for reelection and ushered in the reintroduction of term limits. What’s more, he decried the practice, all too popular in Latin America, of former presidents remaining powerful forces after they leave office.

But on that front, too, Moreno’s efforts may ultimately fail. A victory by Arauz would amplify Correa’s lingering influence. The same thing happened in Bolivia last year, where the deposed Morales, another member of the pink tide, saw his own protégé come to power. The question now is whether the devastation brought by the pandemic will drive a new wave of socialist leaders in Latin America, starting in Ecuador, who are beholden to the still-influential leaders of the first one.

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