Ecuador’s Economy: Oil and Agriculture, Overdependence
One of the main features of Ecuador ’s economy is its dependence on only a few key export commodities, most importantly oil and bananas. Oil accounts for approximately 40% of the export economy, while bananas are responsible for about 17%, and Ecuador is the largest producer of bananas in the world. The rest of the economy is mostly based on less important agricultural exports, such as shrimp and flowers, which account for 6% and 4% of exports respectively. Ecuador is almost completely reliant on the success of these few industries, particularly oil, and so has suffered through a cycle of boom and bust economies over the past several decades, since oil was discovered in the 1970s. Furthermore, in the last six years Ecuador has had four different presidents, and the national office has been dogged by scandals and corruption. This environment has made it very difficult for the government to accomplish the reforms that are necessary to stabilize the nation when the economy faces a serious downturn.
There are two main factors that have been very significant in determining the health of Ecuador ’s economy at any given time, and those are oil prices and extreme weather events. Ecuador’s major agricultural exports are, of course, very susceptible to damage from harmful weather; while the oil industry, until quite recently, has been dependent on only one major pipeline for transport, the Sistema Oleoducto Trans-Ecuatoriano (SOTE). In 1987 a large earthquake rocked Ecuador, destroying a large stretch of the SOTE pipeline, which, when combined with a decline in world oil prices, nearly resulted in a complete collapse of the economy. Another devastating weather event, which also...
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As early as the 1950s, “indigenous merchants traveled to Columbia, Venezuela, Peru, Chile and Argentina” seeking markets and commerce (36). This swell of savvy Otavalos seeking new trade demonstrates the culture’s durable penchant for innovative business and financial exchange. However, it was not until 1964 that the Law of Agrarian Reform abolished wasipungu that major shifts in economic industry took hold of Otavalo. The process of redistribution levied out 180,000 acres of Otavalo land by 1979, but there was hardly enough land to support and feed single families, and so families began to focus on textiles and tourism for support. In the pinch of the 1974 OPEC oil crisis on Ecuadorian economy, the prosperity of the Otavalo persisted despite a floundering national economy because they “relied on textiles and tourism rather than agriculture” (39). With the advent of national roads facilitating tourism, the profit of the Saturday market skyrocke...
Burns, E. B., & Charlip, J. A. (2007). Latin America: an interpretive history (8th ed.). Upper Saddle River, N.J.: Pearson Prentice Hall.
Mignolo, W. D. (2005). The Idea of Latin America (pp. 1-94). Malden, MA: Blackwell Publishing.
This previously inexistent economy is what allowed Trujillo to attain and strengthen his power in the Dominican Republic. Oddly enough, the same peo...
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Some of the violations included the territory being exploited by using it for deforestation and polluting the river and waters by the foreign investors (Sin la Verdad no hay Justicia 29). The foreign investors, that were not named, invaded the communal lands and harassed the native tribes during oil exploration work (Sin la Verdad no hay Justicia 29). Despite Cordero’s economic plan, Ecuador’s “external debt increased 45% from 1984-1988” and brought the country into further oppression (Sin la Verdad no hay Justicia 30). Besides the violations that occurred to the land and natives in the Amazonia, Cordero also was violent toward the left wing opposing part by trying to control the other operations of the government that went beyond his authorized power. Cordero tried to eliminate the opposition and “disqualify representatives by falsely accusing them of harboring terrorist and drug dealers” that would make them unpopular with voters (Sin la Verdad no hay Justicia 30). Cordero tried to extend his power as President by taking control over the “Official Registry in which one has the power to decide what laws would be published and which ones would not be” and that would make be able to push his agenda (Sin la Verdad no hay Justicia
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The downfall of oil prices during the early 1980s followed by the financial decline in the 1990s prove to be the causative reason for the migration of Ecuadorians from rural areas to the city and in addition of the emigration to other countries like Spain or US. Greater parts of those who decide to migrate to the cities are the ones who are currently unemployed, seeking for an opportunity to find a job to support their families. Those who are incapable of achieving higher edification opt to become economic migrants. The precariousness of children, the strain between migrants and locals, worker abuse, economic problems, loss in cultural views are few of the many pessimistic effects due to the migration of residents in Ecuador. President of Ecuador, Rafael Correa passed a new Communications Law to control the information given out to public by the press and media. This law limits and restricts the press from their liberty of publishing all the news material they can. The public is accusing the members of the press of not publishing everything that is necessary. Public protesters against the government are countered by prosecutors who widely use counterterrorism ...