Why Ecuador Needs A Change in the Regime after Ten Years (Commentary)

EXCELLENT INSIGHT INTO THE WORKINGS OF ECUADOR

This piece is published with permission by an expat of many years experience in Ecuador who has a keen perception as to what goes on above and below the surface in Ecuador. It is highly recommended by Latinamericacurrentevents.com that this article/commentary should be read by any foreigner who resides in or who is considering moving to Ecuador.

Ecuador Election – Sunday 19th February/2017 BY Fulano
If you can vote, please do … and that vote should be for change … not the status quo.
================
I have written a summary this week to explain to the many foreigners who DON’T work at “ground-level” here (and therefore don’t really know) … exactly the kind of mistakes this current parasitic government has made (especially over the last 4 or 5 years) … and why those mistakes have since necessitated their ongoing programs of sucking the country and its citizens dry … and in the process, generally making life hellish and difficult for everyone (except of course its favoured sycophants), no matter how far away from its reach one tries to stay.

Please read all the way through for examples and citations of source material of this (expanded) post, whereby one can clearly see evidence of the appalling nature of the current regime, and the monster it has become.

The Correa government has become a classic example of a desperately engorged parasite, getting bigger and bigger, but never getting enough … and accordingly sucking its host dry, thereby eventually killing it. The truth of this should be obvious to anyone who is really investigating things objectively.

Additional food for thought is that EVERY Ecuadorian I know (who is not currently PAID (either directly of indirectly) by Correa … wants this government GONE.

I am not going to tell people who I think they should vote for (any vote that is NOT for the continuation of Alianza Pais 35, is fine with me) … but given the extent of the disastrous direction in which this country has been pushed by Correa (and his poor economic management and by now entirely discredited doctrine), it needs a diametrically opposing force to even get it anywhere NEAR back towards “functionality” or “centre.”

The most logical force to do this is Guillermo Lasso, who, whatever his previous failings may be, certainly understands the need to jump-start the economy (from a local level upwards), and increase confidence for investment (both foreign and domestic).

He understands the needs of the market, and understands the fact that the Correa government has systematically and relentlessly KILLED small to medium enterprise right across this country. And when you lose your SMEs, the country goes down the toilet pretty quickly thereafter.

I think there is still a bit of time to reverse the catastrophe which has been wrought by the Correistas during the last 4 or 5 years (which is, I think, about when the “worm turned”) … but it has to happen now … at this election.

If you can vote, you should vote … and that vote should not go to the status-quo. If it does, we will certainly continue on the same road over the cliff, with the bus-driving President of Venezuela … and nobody wants to see that here in Ecuador. Because of the “run-off” two stage voting system here, it would be preferable to give your vote to Lasso (the candidate with the best chance of taking it to a second-round vote), otherwise the fragmented vote only serves the sitting regime.

Looking back, Ecuador had some vitality and joie de vivre previously (in my first four or so years here). Since then it has been a steady and terrifyingly noticeable decline into the depressing pit we now inhabit. “More of the same” is not going to fix things … it is going to finish this country off.

So for what it’s worth … if you want a bit of that effervescence and positivity back in day to day life in Ecuador … whereby people aren’t walking around eternally burdened with a “heaviness” because of how difficult, controlling, bureaucratically regimented and openly avaricious their government is … do yourself and all of Ecuador a favour … and please vote for change.

Additionally, if anyone has any questions for me about why and how I know this in respect of my personal and business experience here over nearly the last decade, I am more than happy to answer those questions, either in person or here in comments, or perhaps some via PM. Anyway, I am available.

Cheers for now … and this coming Sunday, let’s all do our little bit to help Ecuador hopefully crawl out of this pit it has been driven into.

EXAMPLES AND LINKS TO CONFIRM THE ABOVE

Taxes, fees, charges generally – Tripling (or more) in a very short time, of many existing taxes, and the invention of many new fees/charges etc.

For example, when introduced, the “exit tax” on funds leaving the country (impuesto de salida de divisas), was 0.5% (that is, half a percent). It is now 5% … a 1000% increase.

Common municipal requirements (like a fire certificate) went from $5 to $60 or more, overnight, for no reason except revenue-grabbing. A 1200% increase for an item for which no “work” is done.

Land taxes have increased markedly (doubled or tripled or more in only the last few years).

The impuesto verde (environment tax) is a blatant rort, has been responsible for the decimation of the market for cars or vehicles with (often very needed) larger engines (in this hilly terrain) … and is the main reason many cars now cost up to $500 or more (per year!) to legally keep on the road. This is INSANE.

The bureaucracy, time, and cost involved in getting the “registro sanitario” certification for an edible product … has turned ordinary people into criminals. A case in point would be simple farmers, often illiterate, who for generations have taken their milk and cheese to market. They have neither the time, skill or money (for lawyers and fees) to navigate the processes necessary to obtain the stupid piece of paper they need … but if they continue to sell without it … they are law-breakers. Into the bargain, the government now requires that EVERY cow or livestock be registered (more time) with a tag (more cost), and that those animals require (costly, regula, and multiple) vaccines. This means their produce is now no longer organic (or potentially safe) in any sense of the word. This situation is mandatory.

The re-writing of employment law a few years ago (heavily weighted in the favour of employees), unsurprisingly had a profoundly negative result in the economy, and for the day to day life of many workers … and the restaurants, shops or other businesses who need them. Households that previously employed (perhaps part-time, 2 or 3 people), dropped them all, because of the extremely punitive conditions under which they were now obliged to employ people. Therefore, unemployment and under-employment was massively driven up, almost overnight … and many everyday Ecuadorians found themselves with no work, and very little likelihood of getting any.

OUTSTANDING HOUSING OPTION FOR ECUADOR – MODULAR HOMES

REAL ESTATE FOR SALE/RENTALS IN ECUADOR

RELOCATION SERVICES TO ECUADOR – JOURNEYMAN JACK

Interestingly (and predictably) enough, the government assiduously avoids its own employment regulations (that it expects everyone else to abide by) by only employing people on 6 month contracts, and then unceremoniously firing them. This is why the people you deal with in government offices are often absolutely clueless about the processes they are supposed to be “processing” and often look overjoyed if they can tell you “no hay sistema.” Those poor souls have only been there such a short time, know nothing, and KNOW they are going to lose their jobs soon. So why bother learning anything so they can be helpful? After all, they’ll be churned any day, and replaced with someone else who knows even less than they do.

We have watched restaurants and other businesses in Loja, enter that death spiral after having to let many of their employees go (and perhaps hiring a couple of family members who they trust enough not to sue them under the onerous employment law). It is a very sad thing to watch an economy be suffocated by the punitive and idiotic strokes of clueless bureaucrats’ pens.

The real-estate market (a subject I am intimately familiar with) has never been in a worse condition than it is right now. Three things have contributed to this over the last few years, and another recent one put the nail in the coffin.
1. Bureaucratically, it became almost impossible to subdivide larger properties into smaller pieces … hence a lack of marketable properties coming onto market.
2. Making it much more difficult (or unlikely) for a foreigner to be able to get residency by buying property … by changing the $26K threshold from the Escritura (deed) to the Impuesto predial value (always a much lower value). This ensured anyone buying “land only” would NOT be able to use that land for their residency, and would therefore have to come up with additional funds or proof via another method, for their residency.
3. Massive decrease in investor confidence generally – because of the direction of the Correa government has gone in. This results in people leaving the country, and many others not wanting to come. This is partly why it is such a “buyer’s market” at the moment. Ironically enough, prices are only being held up even to the low extent they are … because there are less properties able to come onto the market (as per point 1).

Obviously at this point the bureaucrats were wondering what else they could possibly do to completely kill the market completely DEAD … so they added firstly the NEW requirement that rural properties need to obtain building permits … and they then finally passed the capital gains tax (PlusValia) … which effectively is the final stake through the heart for the real-estate market in Ecuador (for the foreseeable future).

On the upside, International Living’s ludicrous articles on finding “bargains in Ecuador” will no longer be as full of crap as usual. Good for people wanting to take a chance on Ecuador’s future …. not so good for those who’ve seen their real-estate plummet in value, and are now perhaps trying to get out before Ecuador potentially turns into Venezuela.

Whilst on the subject of real-estate, the government agency SigTierras, a few years back, began a process of matching up pinpoint GPS surveys of the whole country and all properties therein, against actual (in many cases ancient) Escrituras. If the SigTierras survey found an area of land GREATER than that which was on any given Escritura, you are required to BUY YOUR OWN LAND at the prevailing rate per m2 from the government. We know of one person who was hit with a $32K bill for a discrepancy of about an acre (4,000m2). This is an obvious example of the government robbing its people to their face. Imagine having to suddenly pay AGAIN, for imaginary new land, that you already bought generations ago! In this case, until it is paid, he cannot legally sell his own land. 

The other thing which always happens under such “administrations” as the Correa one we are now under …. is the complete takeover of the legislative and judicial branches of power by the executive. Thereafter, the media (and anyone else) can also be shut down and intimidated into toeing the party-line. This has been evident for some time now in Ecuador, for anyone paying attention. Anybody who writes or speaks out in any significant way … is intimidated and ultimately silenced. Ask Crudo Ecuador, Ecotel TV (Loja), the Pacha Mama environmental foundation, or Manuela Picq their thoughts on this phenomenon. There are countless other examples for anyone who wants to go looking.
Crudo Ecuador: https://panampost.com/…/correas-nemesis-crudo-ecuador-shut…/
Ecotel Loja: http://www.fundamedios.org/alertas/emisora-intenta-ser-clausurada-y-sale-del-aire-tras-operativo-policial/
Pacha Mama Foundation Shutdown: https://www.pachamama.org/news/government-of-ecuador-shuts-down-fundacion-pachamama
Manuela Picq: https://panampost.com/rebeca-morla/2015/12/03/deportation-from-ecuador-hasnt-silenced-activist-manuela-picq/

Additionally, the “public service” contingent starts to bloat enormously, and all “employees” are expected to become Correa supporters … and nearly all of them do. They provide a ready pool of people who are REQUIRED to down tools (not that they were doing/achieving much anyway!) at a moment’s notice, to attend Correa functions, events, etc. So … they are either being paid to take time off work to provide enthusiasm for political events … or they are ACTUALLY paid to attend events. I dare you to watch this hilarious video where Correa supporters ADMIT to being paid to attend his speaking event (much to Correa’s mortification). https://www.youtube.com/watch?v=gFo2Ujr2aXI

The other aspect of this is that high ranking military and police officers also need to be “persuaded” and kept “sweet” such that they continue to defend the regime in the event of the inevitable public unrest. The higher echelons of the police and the military are one of the very few public sectors within Ecuador who are pretty much always very well paid, and paid on time. In terms of the “pecking order” of importance, they are at the top, for obvious reasons.

Most worrying, was the level of unpreparedness and complete lack of readiness for what happened when oil prices plummeted from around $120/barrel to under $40/barrel. One would think Correa (apparently a US-trained economist) would have wisely been salting away a proportion of these revenues for some kind of “rainy-day-fund.” But no … apparently not. The only “Plan B” Correa had, when this “disaster” struck … was to go running back to the Chinese with cap in hand. The amount of Chinese debt which Ecuador now has … is now properly scary … and will cripple the country for at least a generation to come. Fortunately this should not trouble Correa himself, as he will be living the high-life in Belgium, swanning around the European lecture circuit, talking about the “economic miracle” he bestowed upon his beloved Ecuador … whilst no doubt blaming whoever inherits the debt-bag, for the failings which will certainly manifest as a result of this kind of burden.
https://qz.com/256925/ecuadors-unhealthy-dependence-on-china-is-about-to-get-1-5-billion-worse/

I should also reiterate that despite Correa having made a big fuss about how the Constitution “PROTECTS NATURE” he is currently raping the Amazon at an unprecedented rate (because of his poor judgement regarding the economy, oil prices, etc). He is also in bed with Monsanto, and has been trying very hard to get GMOs and seed control in the door here. Now … ask yourself … why would he be doing that? It does not take a rocket-scientist to figure it out. Anyone who can’t, you are more than welcome to ask me privately! LOL.

And to close, in respect of further cementing a point I made earlier, about small to medium enterprises having been killed across Ecuador, here is a link to the latest ranking for “ease of starting a business” in Ecuador. When I came here, this ranking was, from memory, around 100, which, while obviously not good, was not totally catastrophic. I have watched this ranking FALL every single year Correa has been in power, to its current all time lowest point, of 166. To put that in perspective, there are only about 195 countries. This means there are some countries which are more or less permanent war-zones, where it is STILL easier to start a business, than it is in Ecuador.
http://www.doingbusiness.org/data/exploreeconomies/ecuador

In closing, TEN YEARS of this regime is ENOUGH. Anyone who thinks the same regime that did all this, is actually going to solve these problems, you are either vested, incredibly naïve, or refusing to accept hard historical evidence. Please vote for change on Sunday, for the sake of EVERYONE in Ecuador.

“No problem can be solved from the same level of consciousness that created it.” – Albert Einstein

THINKING OF MOVING TO ECUADOR – THIS IS ONE BOOK THAT IS A MUST READ