Ecuador’s Economy: Oil and Agriculture, Overdependence
One of the main features of Ecuador ’s economy is its dependence on only a few key export commodities, most importantly oil and bananas. Oil accounts for approximately 40% of the export economy, while bananas are responsible for about 17%, and Ecuador is the largest producer of bananas in the world. The rest of the economy is mostly based on less important agricultural exports, such as shrimp and flowers, which account for 6% and 4% of exports respectively. Ecuador is almost completely reliant on the success of these few industries, particularly oil, and so has suffered through a cycle of boom and bust economies over the past several decades, since oil was discovered in the 1970s. Furthermore, in the last six years Ecuador has had four different presidents, and the national office has been dogged by scandals and corruption. This environment has made it very difficult for the government to accomplish the reforms that are necessary to stabilize the nation when the economy faces a serious downturn.
There are two main factors that have been very significant in determining the health of Ecuador ’s economy at any given time, and those are oil prices and extreme weather events. Ecuador’s major agricultural exports are, of course, very susceptible to damage from harmful weather; while the oil industry, until quite recently, has been dependent on only one major pipeline for transport, the Sistema Oleoducto Trans-Ecuatoriano (SOTE). In 1987 a large earthquake rocked Ecuador, destroying a large stretch of the SOTE pipeline, which, when combined with a decline in world oil prices, nearly resulted in a complete collapse of the economy. Another devastating weather event, which also...
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This previously inexistent economy is what allowed Trujillo to attain and strengthen his power in the Dominican Republic. Oddly enough, the same peo...
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As early as the 1950s, “indigenous merchants traveled to Columbia, Venezuela, Peru, Chile and Argentina” seeking markets and commerce (36). This swell of savvy Otavalos seeking new trade demonstrates the culture’s durable penchant for innovative business and financial exchange. However, it was not until 1964 that the Law of Agrarian Reform abolished wasipungu that major shifts in economic industry took hold of Otavalo. The process of redistribution levied out 180,000 acres of Otavalo land by 1979, but there was hardly enough land to support and feed single families, and so families began to focus on textiles and tourism for support. In the pinch of the 1974 OPEC oil crisis on Ecuadorian economy, the prosperity of the Otavalo persisted despite a floundering national economy because they “relied on textiles and tourism rather than agriculture” (39). With the advent of national roads facilitating tourism, the profit of the Saturday market skyrocke...
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Venezuela was one of the richest countries that emerged from the collapse of Gran Colombia in 1830 (the others being Colombia and Ecuador). For most of the first half of the 20th century, Venezuela was ruled by generally benevolent military strongmen, who promoted the oil industry and allowed for some social reforms. Democratically elected governments have held sway since 1959. Current concerns include: a polarized political environment, a politicized military, drug-related violence along the Colombian border, increasing internal drug consumption, overdependence on the petroleum industry with its price fluctuations, and irresponsible mining operations that are endangering the rain forest and indigenous peoples.
...sed demand on fuels around the world, Chile took advantage of this fact and started to open oil extracting industries/plants. The export of many in demand products including exotic fruits and animals (Lamas) attracted many international consumers towards Chile. The Industrializing era started to take over major Chilean cities in order to compete in international trading and economic growth. Due to an overthrow of the military rule, the switch to a democratic government meant that Chile had a bright future ahead. In present day, Chile is considered to be one of the top developing countries competing aggressively against many great nations. The Chilean government stabilizes, putting in all efforts to a better economic health for Chile. Every day the levels of governmental, political, and social issues in Chile decrease, leaving more space for businesses to flourish.
Hugo Chavez was a powerful and positive force in addressing social issues, however, his singular focus on social issues at the expense of other matters of the country left the Venezuelan economy in tatters. In 1998, 50.4% of the Venezuelan population was living below the poverty line, where as in 2006 the numbers dropped to 36.3% (Chavez leaves). Although he aggressively confronted the issue of poverty in Venezuela, many other problems were worsened. Some Chavez critics say he used the state oil company like a piggy bank for projects: funding homes, and healthcare while neglecting oil infrastructure and production. Without growth in the oil ind...
Brazil has two sources to undertake the financing of necessary changes in the production and adaptation process to the new reality: the Climate Fund and the Amazon Fund. The first account with funds from profits of the oil production chain is intended for activities aimed at combating desertification, adaptation, climate change, education activities and training, among other activities. The other source gets donations for investments in prevention, monitoring and combating deforestation, conservation and sustainable use of the Amazon forests.
Some of the violations included the territory being exploited by using it for deforestation and polluting the river and waters by the foreign investors (Sin la Verdad no hay Justicia 29). The foreign investors, that were not named, invaded the communal lands and harassed the native tribes during oil exploration work (Sin la Verdad no hay Justicia 29). Despite Cordero’s economic plan, Ecuador’s “external debt increased 45% from 1984-1988” and brought the country into further oppression (Sin la Verdad no hay Justicia 30). Besides the violations that occurred to the land and natives in the Amazonia, Cordero also was violent toward the left wing opposing part by trying to control the other operations of the government that went beyond his authorized power. Cordero tried to eliminate the opposition and “disqualify representatives by falsely accusing them of harboring terrorist and drug dealers” that would make them unpopular with voters (Sin la Verdad no hay Justicia 30). Cordero tried to extend his power as President by taking control over the “Official Registry in which one has the power to decide what laws would be published and which ones would not be” and that would make be able to push his agenda (Sin la Verdad no hay Justicia
...a modern and welcoming country that offers new and diverse opportunities for domestic and international investors within a peaceful territory. Logistical infrastructure including first class airports and developed digital computer activity with triple the number of internet users, Ecuador has developed remarkably. In recent years, Ecuador has invested in several renewable energy projects including strategic projects in mining and oil with the utmost respect to the environment through responsible extraction. Between 2007 and 2010, an efficient public health system was established and the national government increased their investment in health by 129% in comparison to the 2003-2006 periods. A significant increase in the state budget dedicated to research and development demonstrates a long standing commitment of the national government towards science and technology.