Abu Dhabi


New York

Tuesday 20th March 2018

Unrest in Ecuador over Fuel Subsidy Cuts


7Dnews London

Sun, 06 Oct 2019 13:14 GMT

The scrapping of decades-old fuel subsidies by Ecuador’s government has led to protests which have convulsed the nation for three days, according to Reuters.

Indigenous organisations and workers' groups in Ecuador have vowed to continue protests against President Lenin Moreno's austerity measure of the withdrawal of the subsidies.

The protests came after Moreno, who took office in 2017, refused to back down over the austerity measure and imposed, under a $4.2 billion deal with the International Monetary Fund (IMF), causing a doubling of the price of fuel overnight and sharply raised gasoline prices.

Protestors halted transport, barricaded streets and clashed with police for a second day on Friday October 4th, as almost 370 people were jailed over unrest triggered by President Lenin Moreno's scrapping of fuel subsidies. 

Earlier, the 66-year-old president, who declared a state of emergency over the strike, said that the subsidy has been harmful to the national economy, costing the state heavily for years.

“There will be a mechanism to alleviate the effects that (the end of the subsidy) could have on some sectors, of course,” he said, “and we are ready to do that, but under no circumstances will we change the measure.”

As well as ending fuel subsidies, the government is reducing the state workforce and planning some privatisations. Moreno explained the fuel subsidies, in place for four decades, had distorted the economy and cost $60 billion.

"These are tough but indispensable decisions which the government thinks will have a positive impact in the medium and long term," Foreign Minister Jose Valencia told reporters, saying benefits for the poor had been raised.

Ecuadorian Interior Minister Maria Paula Romo said at a news conference on Friday, October 4th that at least 350 people had been arrested over two days of unrest. They included leaders of indigenous organizations that had blocked public roads. Most of those arrested, Ms Romo said, were accused of vandalism, nearly half of them in Guayaquil.

Although there were also accusations that the police had attacked journalists covering the protests, the government stated that 28 police officers had been injured in the clashes.

On Thursday October 3rd, the day fuel prices rose, masked protesters hurled stones, set up burning blockades, and battled police who deployed armoured cars and tear gas, during the worst unrest for years in the country of 17 million people.

At a news conference in Quito on Friday October 4th, protest leaders said demonstrations would continue and called for a nationwide strike on October 19th.

The winner of the 2017 election, Moreno's popularity has sunk to below 30% compared with above 70%, and is set to put his oil-producing nation on a centrist track after years of socialist rule under predecessor, Rafael Correa.

However, Moreno has the support of the business elite, the military appears loyal, and the political opposition is weak, Ecuador toppled three presidents in the decade before Correa took power in 2007.

Ecuador hopes to save about $1.5 billion a year from ending fuel subsidies. Along with tax reforms, the government would benefit by about $2.27 billion.

Latin America