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  • Centro para el Bien Común Global

Ecuador: An ideal laboratory for shock therapy?

25/1/2024


​Ecuador does not stop inaugurating its “first times”. After closing 2023 being the most violent country in Latin America[1], this beginning of 2024 has been marked by a new episode of measures “never before” taken by the government and that places this small South American country in the world news. The declaration of a State of Exception accompanied by the mention of Internal Armed Conflict[2] draws a new horizon in which the declaration of war on organized crime and terrorism becomes the strategic objectives and the primary political narrative. The climax took place on January 9, 2024 when bombs exploded in various parts of the country, criminal gangs took to the streets to challenge, loot businesses and frighten the population. Public institutions, hospitals, universities and shopping centers were attacked. There was even a confusing episode of takeover of a live television channel by a group of hooded criminals that fortunately ended with their arrest and no lives to regret. In prisons, prison guides were kidnapped and videos were spread on social networks with threatening messages against the lives of officials and announcing more reprisals in the streets. The reasons for such an outbreak of violence emerged in two ambiguous but different frequencies: on the part of the government, it was the result of the heavy hand that was beginning to be applied against organized crime in prisons and on the streets; On the part of the gangs, the escape from prison of the criminal leader alias “Fito”, head of one of the gangs at the service of the Sinaloa Cartel, reconfigured the balances of power. The day ended with eleven deaths.


All of these concomitant events, for many broadcast live on social media, plunged the country into panic. The workday was interrupted, students and workers were sent home, and citizens only thought about safely reuniting with their families in their homes. The fear, which had already been latent in daily life for several months, reached its paroxysm and with it, a generalized demand for urgent and forceful measures, translated into a clamor for a greater presence of military and police in the streets, total surrender of the power of the principal and the application at its highest level of legitimate force by the State.


The State's response did not take long to arrive and with it the incorporation of the war narrative in political and media instances. So much so, that on January 9, the designation of 22 criminal gangs as military objectives with the category of terrorists was made public. This suggested a treatment that, in addition to a grandiose declaration to mark state priority, would have new legal implications that would put Ecuador on a path of no return.

By declaring Ecuador in a situation of internal armed conflict, the idea is perfected that there is a recognizable enemy that has established control over certain territories of the country, which also has a hierarchical structure, training and military-type weapons, therefore, with a command, and that, finally, confronts the legitimate authority of the State.


Also, in strict sense, and as referred to in the Presidential Decree, the armed enemy intends, with its violent actions, to achieve objectives differentiable from those of common crime and normally linked to: “demands for self-determination and self-government, or aspirations.” identity; opposition to the political, economic, social or ideological system of a State or to the internal or international policy of a Government, which in both cases motivates the fight to access or erode power; or to control of resources or territory” (Office of the High Commissioner for Refugees 2008). Naming each of the armed organizations concerned in the decree and declaring them military objectives is equivalent to recognizing their existence and structure and suggesting that their objectives may have other aspects than merely criminal ones.


The declaration also implies that the situation of non-international internal conflict in Ecuador must be recognized by the international community, since from now on International Humanitarian Law will govern the hostilities that occur within the framework of said conflict and that open the possibility of being prosecuted in international courts (International Committee of the Red Cross 2008).

The fact of classifying the armed protagonists of this conflict as terrorists[3] and resorting to the exceptional criminal legal framework in the figure of terrorism, is equivalent to admitting the uncontrollable nature of the power of the organized structures that they want to confront and the impossibility of doing so through traditional law enforcement and criminal enforcement.


Although the declaration is then presented as a forceful and decisive message for the fight against organized gangs, it also reveals a public recognition by the government that the Ecuadorian State has lost control over its sovereign territory and over the management of its institutions. . It also reveals the state's weakness, the poor state of strategic planning and intelligence capabilities, the weakening of oversight and control entities, and the poor state of health of the judiciary.

In other words, the government presents to the world and citizens an unviable Ecuador, which requires forceful measures to rescue it, even above the high costs in terms of sovereignty and sacrifices for the population.


Security as a workhorse for a promise of peace


The logistical conditions, especially of the Armed Forces that must now enter with all their capabilities to control the territory, require urgent strengthening that has already been discussed since President Lasso's mandate.

Thus, in October 2023, the “Status of Forces” was signed between the government of Ecuador and the United States of America and is awaiting approval from the Constitutional Court. This agreement establishes, among other things, and without benefit of inventory, a privileged status for the military, civilian personnel of the Secretary of Defense and US contractors in their actions on Ecuadorian soil; authorizes the United States to exercise criminal jurisdiction over these personnel while they are in Ecuadorian territory; authorizes these personnel not to pay taxes in Ecuador. It also grants the power to aircraft and ships managed by these personnel to enter and leave the territory as many times as necessary and with exemption from taxes for the use of ports and airports. They will also be able to use Ecuadorian military facilities, as well as the country's radio spectrum (Ministry of Foreign Affairs and Human Mobility 2023).


The immediate offer of cooperation by the United States, after the violent wave of January 9, will undoubtedly accelerate the validation of the agreement and the aid will be implemented without delay. The visit of a North American delegation starting on January 22 will specify the guidelines for this aid, the framework of which has already been widely agreed upon.

Among other eloquent measures to combat organized crime, President Noboa also announced and submitted to the Constitutional Court a battery of 20 questions for a Popular Consultation to the Ecuadorian people. Most of the questions (the first package of 11 questions sent to the Court on January 2, 2024) that have already been analyzed by constitutionalists show a purely rhetorical nature since some of the measures that would be intended to be implemented, if a favorable majority were obtained, They are already in force or do not require constitutional reforms to be implemented[4] (Primicias 2024).


As a novelty, however, with regard specifically to security, in the second package of 9 questions sent for analysis on January 8, the government proposes the extradition to the United States of Ecuadorian citizens linked to organized crime, a proposal that had already been made. was rejected in the last popular consultation proposed by former President Lasso in February 2023. Also, ask about the possibility of pardoning police, military and prison guards in processes in which they are involved in the use of force against alleged criminals, as well as judging them in specialized courts (Primicias 2024).


Finally, as a lighthouse proposal, which was a promise from his electoral campaign, Daniel Noboa reiterated his intention to build high-security mega prisons[5]. He emphasized in the media that the model will be taken from existing experiences: “They will be the same, because it is the same company, under the same design, that made the maximum security prisons in Mexico and that made them in El Salvador” (El Trade 2024). These will be located in the provinces of Pastaza (Amazon)[6] and Santa Elena (coastal).

The agreements, decisions and events that occurred with enormous intensity have followed a logical sequence, since more violence has been responded to with more offers of security and more fear, fewer reservations for the achievement of extreme measures. The script seems to be coherent and follows its course.


War costs and someone has to pay


In the midst of the chaos that has been in crescendo for several months, a very critical social and economic situation in the country, and with a population still under the trauma of the wave of violence unleashed, the government sent an urgent bill to the legislature. to implement a 3-point increase in the Value Added Tax (VAT) that would go from 12 to 15%. As Noboa justified: "We must take tough economic measures and we must be aligned because a war costs and costs money" (Agencia EFE 2024).


But the alignment to which Noboa refers was already underway as soon as he assumed power last November when his proposal for the Economic Efficiency and Employment Promotion Law, which in its broad outlines, allowed a broad regime of tax exemptions for free zones and the refund of the value added tax on real estate projects that would primarily benefit his aunt Isabel Noboa, owner of one of the most powerful business and real estate corporations in the country.


The president's pronouncements would then continue to pave the way towards a clear intention to reduce the size of the state, through budget cuts and massive layoffs in the public sector, proposals for legal reforms aimed at the privatization of public companies and the strategic resources of the State[ 7], continuity of oil exploitation in protected areas such as Yasuní despite the approval of a popular consultation that dictates stopping such exploitation[8].


The executive also puts the discussion again on the table about the targeting of fuel subsidies, a delicate issue that already led to the paralysis of the entire country in 2019 and 2022 due to its implications on the cost of living of citizens[ 9].

The popular consultation project also addresses the issue of economic policy by raising a question about foreign investment and the recognition of international arbitration “so that foreign investors are offered an appropriate environment of legal security that generates greater employment opportunities and strengthens the dollarization.” It also aims to promote a reform to make hourly and fixed-term work more flexible (Firsts 2024).

Finally, and due to the short term he has assumed, Noboa plans to amend the Magna Carta to “allow the President of the Republic to classify as urgent laws bills that do not only refer to economic matters” and thus expand his radius of action in several areas.

What model for the country?


In light of the previous analysis, we ask ourselves: What is the country model that is being proposed? One whose priority is to consent to the creditors of the external debt, shrinking the State, ceding sovereignty to respond to foreign interests and transnational companies, facilitating privatizations, the capitalization of renewable and non-renewable resources for corporate economic purposes? One that appeases violence by condemning an entire generation of young people to social stigmatization, leaving them adrift?

Or, on the contrary, one that seeks to strengthen the State so that it can fully play its role as a political, social and cultural regulator and seek to recover the eroded social fabric?

In a country where poverty affects 27% of the population; in which the reality of 4.8 million people is to live on less than 3 dollars a day; in which 60% of the active population is employed informally; in which 200,000 children and young people between 5 and 17 years old have left school and are the ideal breeding ground for criminal recruitment, social policy should not be a simple salute to the flag, but an issue of absolute priority if It aims to truly combat organized crime on several fronts.


Thinking in the future….


A global trend is observed towards the reissue of a market deregulatory model that was applied in the 1990s in several countries around the world, including Ecuador. That, which consisted of a transformation of the economy through tax reduction, the free market, the privatization of services and cuts in social spending, did not enjoy favorable results in terms of improving the living conditions of citizens and solution to poverty, marginalization and social exclusion.


Specifically, for Ecuador, according to economic expert Fernando Martín Mayoral, the recipe implemented by the IMF in 1994 through the General Law of Institutions of the Financial System, which allowed the deregulation of the banking system, led to a collapse of the financial system. which led to the country's worst financial crisis in 2000 and which resulted in the dollarization of the economy. In the period 1995-1999 “The country experienced one of the most accelerated impoverishment processes in the history of the region and an accelerated concentration of wealth” (Martín 2009). Privatizations of public companies took place, especially in the oil, electricity and telecommunications sectors to address the public deficit since in 1999 the debt exceeded 100% of GDP. Even in 1995, there was a war against Peru that would call on the people to identify an enemy outside the borders.


These waves of implementation of aggressive neoliberalism, widely documented and theorized in Naomi Klein's work, The Shock Doctrine, require ideal conditions to get underway. Favorable scenarios are achieved after a first shock, a traumatic blow to an entire society, such as a natural catastrophe, a violent seizure of power or a war. On this collective fabric anesthetized by fear and restlessness, and longing for a new beginning, a second shock is delivered, consisting of drastic economic adjustment measures accompanied by a reinforcement of coercive surveillance and control under promises of the generation of new opportunities. in a new framework of order and progress (Klein 2014).


In the midst of this perfect storm, the privatization measures through the concession of strategic services and sectors to corporations, the increase in taxes, the precariousness of working conditions, the regression of rights and the alliances between politics and corporate interests that They grant great privileges to the economic and financial elites, they do not encounter greater social resistance. In the heat of collapse, all change is presented as a possibility of reconstruction on the ruins. However, these reforms are accompanied by the reinforcement of coercive control and the dominance of the media and political message of those in power, and thus appease the possibilities of popular protest. In these contexts of radical changes, struggles for rights tend to be demonized and enjoy little support. For their part, advertisements for anti-terrorist crusades tend to find sympathy for their promise of order and protection, which offers a favorable terrain for the installation of the tentacles of the military-industrial complex with all its services (technology, prison services, private security, etc.) The role of the State remains in the background and serves more than anything to process the measures and give them a certain political and discursive legitimacy. Social policy, for its part, remains a mere mirage (Klein 2014).


Ecuador entered a new stage, this time clearly called “war”, in which an uncertain enemy is designated and fueled by social and economic conditions that do not seem to be in the priorities of attention in the short term. It also coincides with executive and legislative power in the hands of political sectors from all sides, which respond to a greater or lesser extent to corporate and/or criminal interests. In the discursive field, the narratives of hate and social and racial stigmatization are more strongly nourished, shamelessly displaying the extreme positions of certain sectors of the population against others.


Added to all of the above is an economic situation on the brink, with an external debt that is estimated at more than 63 billion dollars, of which 8 billion correspond to various loans contracted with the IMF and which therefore condition economic policy. A high fiscal deficit that is around 5 billion dollars means the country remains subject to external loans and therefore to more restrictions to decide on its budget allocations. (Secretary of Communication of the Presidency 2023).

In this battle scenario, the bells announce privatizations, a drastic reduction in the size of the State, increased surveillance and security control, alliances with foreign forces, labor flexibility, expansion of extractivism strategies with its corollary of dispossession of territories, in short, many of the ingredients of the shock therapy Klein talks about.


Faced with this, organized groups are unable to capture the attention of a citizenry that is still disoriented and desperate for what has just happened. Nor do they manage to articulate a response structured enough to counterbalance and claim before the president and other powers, the legitimate right to participate in decisions, or even consult about their implications and consequences.

Is Ecuador a laboratory where the ideal conditions are being configured for a new shock, this time more accelerated and of greater magnitude? We cannot yet say for sure, but several indications lead us to consider this possibility. Without a doubt, in a very short period of time, decisions and events will tell...


Author:

María Dolores Ordóñez

Researcher in Training EELAT Doctoral Program / University of Alacá de Henares

Researcher in Training (FPI) / University of Alcalá de Henares



Works cited:

EFE Agency. 2024. "Noboa proposes an increase in VAT from 12 to 15% to confront the armed conflict in Ecuador." EFE Agency, January 12.

International Committee of the Red Cross. 2003. International Humanitarian Law and the challenges of contemporary armed conflicts. Geneva: International Committee of the Red Cross.

Trade. 2024. "El Comercio.pe." January 4th. Last access: January 23, 2024. https://elcomercio.pe/mundo/latinoamerica/daniel-noboa-presidente-de-ecuador-anuncia-construccion-de-dos-prisiones-de-maxima-seguro-al-estilo -de-el-salvador-y-mexico-nayib-bukele-ultimas-noticia/?ref=ecr.

Klein, Naomi. 2014. The Shock Doctrine. The rise of disaster capitalism. Barcelona: Paídos.

Ministry of Foreign Affairs and Human Mobility. 2023. "Agreement between the government of the Republic of Ecuador and the government of the United States of America regarding the Status of Forces." Quito, October 12.

Office of the High Commissioner for Refugees. 2008. "UNHCR.org." Last access: January 23, 2024. https://www.acnur.org/fileadmin/Documentos/Publicaciones/2008/6694.pdf?view=1.

First fruits. 2024. «These are the 11 questions for the popular consultation posed by Daniel Noboa. To make use of this content, cite the source and link to the original note on Primicias.ec: https://www.primicias.ec/noticias/ politics/questions-popular-consultation-daniel.» Scoops, January 3rd.

—. 2024. «Extradition and hourly work, in Noboa's second package of questions. To make use of this content, cite the source and link to the original note on Primicias.ec: https://www.primicias.ec/noticias /politics/consulta-popular-daniel-noboa-nue.» Scoops, January 22.

Secretary of Communication of the Presidency. 2023. "Communication Secretariat of the Presidency." communication.gob.ec. November 27. Last access: January 23, 2024. https://www.comunicacion.gob.ec/el-gobierno-del-presidente-noboa-transparenta-la-situacion-economica-del-ecuador/.


[1] The national police of Ecuador recorded, in December 2023, a rate of 40 murders per 100,000 inhabitants and the never-before-reached number of 7,497 violent deaths.

[2] The full text of Executive Decree No. 111 of January 9, 2024 in the following link https://www.comunicacion.gob.ec/wp-content/uploads/2024/01/Decreto_Executivo_No._111_20240009145200_20240009145207.pdf

[3] Note in this regard what was issued by a Report of the International Red Cross: “It is evident that most of the activities undertaken to prevent or repress acts of terrorism do not amount to an armed conflict nor do they imply its existence. The campaign against terrorism is waged using a multitude of means such as intelligence gathering, police and judicial cooperation, extradition, criminal sanctions, diplomatic and economic pressure, financial investigations, asset freezes, efforts to control the proliferation of weapons of mass destruction, among others, which do not involve the use of armed force. It is further noted that no body of law, by itself, can guarantee the absolute repression of acts of terrorism, because terrorism is a phenomenon that, like others, can only be eradicated by attacking its root causes, not its consequences” (International Committee of the Red Cross 2003).


[4] See the detailed analysis of each question at the following link: https://www.meythalerzambranoabogados.com/post/an%C3%A1lisis-legal-de-las-preguntas-de-la-consulta-popular-2024 -who-propose-reforms-to-c%C3%B3digo-org%C3%A1nico

[5] Note that Executive Decree No. 111 of January 9, 2024, the explanatory memorandum takes as reference the Report of the Subcommittee for the Prevention of Torture and Other Cruel, Inhuman and Degrading Treatment or Punishment, which stipulates as a recommendation that in the future Smaller, more manageable prisons are built instead of megaprisons as has been done during the Rafael Correa government.

[6] The project in the Amazon has already received rejection from the Confederation of Indigenous Nationalities of Ecuador (CONAIE) since the aim is to build the prison in the territories of the peoples and nationalities, thus affecting their living habitat in addition to tourism, which is one of the main productive activities in the area.

[7] This refers to the recent approval of the Organic Law on Energy Competitiveness, which now allows the market to be opened to private companies for the commercialization of energy.

[8] Arguing the priority and cost of the security crisis, Daniel Noboa announced on January 23 that he will propose a moratorium to continue exploiting the oil from block 43 despite the resolution of the popular consultation that dictates stopping this exploitation (El Mercurio 2024).

[9] There is still no official statement on how the subsidies will be directed, but according to the Minister of Economy and Finance “they will continue to be provided to those who really need it, trying to avoid smuggling to Colombia and Peru, Those who do not receive it must pay the real production price of gasoline and diesel,” thus leaving it to be understood that they will no longer be applied to these last two fuels, with the consequences that this will have on the production costs of essential products.

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