The Washington Times

Ecuadorean leader’s largesse

Public spending fuels Correa’s popularity among poor

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That included rewriting oil-extraction contracts with multinationals to boost the state’s share of windfall profits. Some multinationals left; others stayed.

The government is now on the verge of reaping more raw-materials royalties. It is set shortly to sign contracts designed to yield the state $3 billion annually from the mining of gold, copper and other metals.

Mr. Correa has been coy on whether he’ll run for re-election in balloting that could come as early as a year from now.

If voting were held today, he’d be difficult to beat. Never in five years in office has Mr. Correa’s approval rating dipped below 50 percent. It currently stands around 70 percent.

Critics accuse Mr. Correa of building castles in the air by creating expectations on the uncertain promise of continued high oil prices. If oil drops below $73 a barrel, they say, his ambitious public spending will need to be curbed.

“It’s not sustainable as an economic model over time,” said Xavier Ordenana, an economist with the Escuela Politecnica del Litoral in Guayaquil. “It can last for some years, but not forever.”

Mr. Ordenana says the government realizes the private sector also must grow or risk insolvency. Heavy industry, export-oriented manufacturing and high-tech work remain scarce in Ecuador.

In all, 5 million of Ecuador’s total population of 14 million have benefited personally in some measure from government largesse, researchers at the Latin American Social Sciences Institute graduate school calculate.

Under Mr. Correa, the state has built homes for 30,000 families, plowed $8.5 billion into education and $5.3 billion into health care. It has rebuilt or improved nearly 3,400 miles of roads, nearly two-thirds of Ecuador’s highway system, spending $4.5 billion.

Other programs have zeroed in on helping individuals and families.

The government says the program for the disabled, a flagship Correa initiative, has benefited 300,000 people. They receive medical attention, welfare payments and equipment including wheelchairs. Some have even been given housing. Public wheelchair access is improving.

Another popular program provides a $35 monthly boost to 1.6 million poor people, chiefly homemakers with no other formal income.

“My husband died many years ago, but now I have the president as a spouse, because he gives me a little money every month,” said Maria Pillajo, a stooped 67-year-old who scrapes by through washing clothes and loading baskets in the market of Quito’s poor southern district of El Camal.

“Until poverty is eliminated, it’s a good measure,” Mr. Correa said of the program when asked about it during a recent meeting with foreign correspondents.

The government says the poverty rate stands at 29 percent, down 9 percentage points from when Mr. Correa took office. Meanwhile, unemployment is officially at 5.1 percent.

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