PRESS CONFERENCE BY PRESIDENT OF ECUADOR

 

The International Monetary Fund (IMF) should be eliminated in favour of regional monetary reserves or other collective measures, President Rafael Correa Delgado of Ecuador said at Headquarters this morning.

“Wipe it off the face of the planet,” President Correa said at a press conference following his address to the Conference on the World Financial and Economic Crisis and its Impact on Development.  Regional financial systems with funds to assist in times of crisis could be an alternative to the IMF, he added, noting that his country had survived the financial crisis through collective action with friendly countries.  They had used measures that the IMF would never have approved since they were contrary to the principles of free-market capitalism.

Recalling that the competition and lack of regulation promoted by the IMF in previous decades had resulted in severe economic problems for Latin America, he underscored his view that people were more of a priority than the market, stressing also that public goods such as the environment required collective management.

The worst of the crisis was over for Ecuador, he said, cautioning, however, that he could not predict the future.  While the remittances sent back home by Ecuadoreans working abroad were still down, the price of oil had risen substantially and the Government was revising its budget upwards as a result.  Ecuador still had a $2 billion deficit, which was 4 per cent of the country’s gross domestic product, but it should be covered by funding from development partners.  The Government was now planning a $4 billion investment programme.

He said he would describe his economic vision as twenty-first century socialism, possibly modelled on an adaptation of the Scandinavian economies.  Its priorities would be social, regional, gender and generational justice, he continued, maintaining that neo-liberalism had exacerbated injustice in Latin America, through a system that was tilted in favour of capital over workers.  The alternative was to reverse that formula while allowing private enterprise to continue.

Asked about General Assembly President Miguel d’Escoto Brockmann’s proposal that industrialized countries spend 1 per cent of their stimulus money on assisting developing countries, he said that would not happen, pointing out that the wealthy countries had failed to come up with even the level of official development assistance (ODA) agreed upon well before the global crisis.

He went on to say that, in any case, he favoured just compensation for the use of such environmental goods as the clean air provided by the Amazon basin as opposed to the charity of such assistance.  In the interest of preserving the environment, Ecuador had proposed the provision of assistance amounting to 50 per cent of the value of the pollution prevented if it declined to open up its forest reserves for the lucrative extraction of oil.  Unfortunately, even the Kyoto Protocol [to the United Nations Framework Convention on Climate Change] did not reward preservation; on the other hand, it rewarded reforestation if a country first chopped down its forests.

Ecuador was negotiating for investment from Iran, the Russian Federation and China, he said, noting that Iran was financing two hydroelectric stations in a mutually-beneficial relationship based on solidarity.  Relations of mutual respect did not require anyone’s permission, he added.

Responding to questions about human rights abuses in Iran and other countries, he said Ecuador would cut off relations with Iran if the United States ended its dealings with Saudi Arabia, remarking that there should be no double standards in mutual economic relationships.  That being said, however, Ecuador hoped for good relations with the United States during the Administration of President Barack Obama, who seemed to be a sincere, committed person seeking to establish solidarity with the rest of the world.

Asked about oil companies that had complained about Ecuador’s requisitioning of profits, he explained that the country had passed a law in 2006 requiring those companies to share windfall profits and most of them had accepted that requirement.  Those fighting the new arrangement were used to doing as they pleased and paying a small percentage of their profits, he said, emphasizing that the oil belonged to Ecuador and transnational corporations were mere “employees” of the country.

In response to questions about his Government’s reported relations with the FARC (Revolutionary Armed Forces of Colombia) rebels, he said they were based on lies and the Government planned to sue the Wall Street Journal, which had printed an erroneous story.  Ecuador would resolve all its differences with Colombia through regional organizations and the International Court of Justice.  “We do not treacherously bomb neighbouring countries,” he added.

Asked finally what he thought the Conference would accomplish, he said the most important thing was that the voices of developing countries were being heard in the economic arena.  “We dare to speak.  We blaze a trail as we walk, daring to bring up alternatives.”

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For information media • not an official record