Three-cushion billiards
The battle between the Executive and the Legislature continues, and we foresee no improvement in the coming months. UNES and the rebels from Pachakutik have not and will not cease in their efforts to get rid of President Lasso — or at least make his life difficult. Social Christians accompany these efforts intermittently, depending on their own interests. In this fashion, they went on vacation until January 3, without making effective the appointment of the Superintendent of Banks, they blocked discussion of the latest bill proposed by the Executive to combat organized crime and violence, and, with an impudence that goes against the best interests of the country, legislators from the above-mentioned political groups accused President Lasso of intending to perpetrate a “soft coup d'état” against the Assembly, and threatened — once again — to propose Lasso´s dismissal.
Their frustration comes from their failed attempt to impeach four members of the Citizens Participation Council. This attempt was halted by a court order that these legislators deem as having been issued under the pressure of the Executive. However, behind their insolent tone, there is clearly fear because some of these legislators could be removed if they do not follow the court's mandate.
The above-mentioned political risk is evident in Ecuador's persistently high country risk premiums, which in December averaged 1,300 points. This, together with high global interest rates, is making public financing expensive and difficult for next year. However, Minister of Finance Pablo Arosemena can feel temporarily at ease as this year's financing is closed with the recent and final disbursement of $700 million from the IMF, which not only helps liquidity but marks a successful conclusion of the program with the Fund. Also, it appears that the General Government deficit will be below the $2.0 b announced by Minister Arosemena, as the overall negative balance as of November is just $486 million.
On the international spectrum, however, reality is different. President Lasso has worked for and achieved an excellent relationship with Washington. His latest visit with President Biden and several meetings with legislators and high-ranking defense officials bring hope for significant results on the trade, security and democracy fronts. At the same time, Lasso has avoided any interference between his approach to the United States and the ongoing conversations with China for a bilateral trade agreement and other topics of national interest. Finally, his triple strategy includes developing joint efforts with Colombian President Gustavo Petro in the fight against drug-trafficking and related crimes. This “three-cushion billiards” game has, so far, been successful for President Lasso and for Ecuador.
Additionally, Minister of Production, Julio Jose Prado, announced that Ecuador and Costa Rica have closed their negotiations for a trade agreement, and that Mexico has finally agreed to accept Ecuador as a member of the Pacific Alliance.
We finish our report with this good news, and we want to take the opportunity to wish all our readers Happy Holidays and all the best in 2023!
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