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Coronavirus: Ecuador to collect from businesses, residents in drastic economic plan

Ecuador‘s President Lenin Moreno unveiled an emergency economic plan Friday aimed at rescuing the South American nation hard hit by the new coronavirus and then dealt a second blow when two large pipelines broke, halting critical crude exports.

Moreno in a nationwide broadcast urged the nation to come together, saying that Ecuador’s massive foreign debt he inherited from past governments will have to be renegotiated, while large businesses earnings over $1 million annually will have to contribute five per cent of their profits.

Drastic measures will also require residents who earn more than $500 monthly to pitch in, he said.

“This economic emergency is unprecedented in the recent history of this country,” Moreno said.

Ecuador, which largely depends on oil exports, was already buckling under $65 billion in foreign debt, when the coronavirus struck. In recent weeks images of the dead left in the streets flooded social media.

It’s been one of Latin America’s nations hardest hit by the virus, infecting 7,161 people and causing 297 deaths, taking its greatest toll on the port city of Guayaquil.

The situation turned worse on Monday, when dual pipelines transporting crude from deep within the Amazon broke as the Quijos River flooded, washing away a mountainside supporting the pipes.

The one owned by the state-run oil firm Transecuatoriano carries 360,000 barrels each day, while the one privately run by Oleoducto de Crudos Pesados sends 450,000 barrels daily of heavy crude.

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Energy Minister Rene Ortiz said in an interview with the Teleamazonas television station on Friday that both damaged lines should be repaired within five weeks. He downplayed economic damage, adding that deals with foreign clients won’t be jeopardized, citing contracts that anticipate such unanticipated incidents.

Nearly 100 oil workers responded to the breaks, trying to stop spilled crude from polluting the Quijos River — whose rising waters caused the damage — and the downstream Coca River, officials said. The break happened 100 kilometres from the capital of Quito deep in the Amazon.

Officials have said there is no risk of fuel shortages within Ecuador due to ample storage. Also, the coronavirus has prompted the nation of 17 million to abide by a rigorous quarantine significantly cutting down traffic.

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