The Ecuadorian economy opens to yellow light from red
Ecuador started its lockdown in mid-March when the situation of Covid-19 in Guayaquil was catastrophic. Most cities have been closed for more than 70 days and some for more than 80 days – which has helped to control the pandemic but has taken a large toll on the economy.
Official information speaks of 200,000 adequate jobs lost, and it is almost impossible even at this point to quantify the underemployment situation, which before the crisis amounted to a high 48%. The International Labor Organization estimates that around 850,000 workers would stop contributing to the Social Security Institute until December.
In this context, the Bill of Humanitarian Support was finally approved last Friday, June 19, almost two months after it was first sent for approval of the Assembly in April. However, none of the originally conceived extraordinary contributions from individuals and corporations aimed at helping cope with the pandemic were passed. The approved bill focuses more on maintaining electricity tariffs, reducing school tuitions, and implementing bilateral arrangements to settle differences between involved parties on rent and other obligations
The original law also considered changes to labor bills (albeit transitory) to make hiring and laying off workers more flexible, in line with the current situation. However, the final version of the bill eliminates this opportunity. Even though it introduces the possibility of reducing work hours proportionally with salaries, it denies firms the possibility of laying off workers under the legal concept of force majeure unless a majority of workers accept it; otherwise, the firm ceases to exist.
Scandals of corruption have asphyxiated Ecuadorians in these last three months, as well. For the first time ever, a recently-conducted poll reveals that it is now the number one concern of Ecuadorians – even above the economic situation and the Covid-19 threat.
However, it seems that citizens still fail to relate corruption to its roots and actors. The same poll ran a presidential simulation of a voting ballot showing Jaime Nebot, Jaime Vargas (the indigenous leader behind the terrible riots of last October), Guillermo Lasso, current Vice President Otto Sonnenholzner and a candidate appointed by former President Corrrea.
A first simulation shows Nebot leading the poll with around 29%, followed by the Correa appointee with only a 0.6% difference, while Guillermo Lasso receives 15% of the vote intention. When other simulations were carried out with only two possible candidates, percentages do not change much but those who would not vote for either one sum 44%.
While it is too soon to jump to conclusions, the simulations show that Correa maintains his hard vote of around 30%, which has not changed in the last four years. If there is a large dispersion of candidates in the first round of the presidential elections next year, this level of support might prove dangerous.
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