{"id":145296,"date":"2019-10-14T12:00:52","date_gmt":"2019-10-14T11:00:52","guid":{"rendered":"https:\/\/www.transcend.org\/tms\/?p=145296"},"modified":"2019-10-14T10:41:46","modified_gmt":"2019-10-14T09:41:46","slug":"ecuador-under-president-neo-cono-moreno-the-imfs-deadly-economic-medicine-the-weaponization-of-neoliberal-reforms","status":"publish","type":"post","link":"https:\/\/www.transcend.org\/tms\/2019\/10\/ecuador-under-president-neo-cono-moreno-the-imfs-deadly-economic-medicine-the-weaponization-of-neoliberal-reforms\/","title":{"rendered":"Ecuador under President Neo-co\u00f1o Moreno: The IMF\u2019s Deadly \u201cEconomic Medicine\u201d, the Weaponization of Neoliberal Reforms"},"content":{"rendered":"

\"\"<\/a><\/p>\n

Lenin Moreno: aka Neocon Moreno<\/em><\/p><\/blockquote>\n

12 Oct 2019 – <\/em>A popular insurrection is unfolding against the adoption of sweeping IMF reforms imposed by the \u201ccentre left\u201d government of President Lenin Moreno.<\/p>\n

In March 2019, a 4.2 billion dollar IMF loan was granted to Ecuador.<\/p>\n

\u201cWe are here to help you\u201d says the IMF. Our objective is to help\u00a0Ecuador \u201cmodernize its economy and pave the way for strong, sustained, and equitable growth.\u201d<\/p>\n

Nonsense!<\/p>\n

This loan agreement initiates a process of economic and social destruction. What is at stake is an engineered economic depression.<\/p>\n

The Neocons in Washington are firmly behind the IMF\u2019s deadly economic medicine.<\/p>\n

Meanwhile, president\u00a0Lenin Moreno, <\/strong>an alleged\u00a0\u00a0socialist \u00a0and \u00a0\u201cLeninist\u201d inspired by Russian Revolutionary Vladimir Lenin has fully endorsed the neoconservative agenda.<\/p>\n

While President Lenin Moreno leads the centre-left\u00a0Movimiento Alianza PAIS (Patria Altiva I Soberana), he is a \u201cNeocon\u201d in disguise, a US proxy: nicknamed President NeoCon Moreno.\u00a0<\/strong>in Spanish Se\u00f1or presidente\u00a0Neo-co\u00f1o Moreno.\u00a0<\/strong><\/p>\n

Mike Pompeo and Moreno are buddies.<\/p>\n

\"\"<\/a>

In Quito, July 2019, Secretary of State Pompeo welcomed \u201cnew\u201d relations with Ecuador. \u201d A new era has begun\u201d, not to mention the arrest of \u00a0Julian Assange by British authorities in April.<\/p><\/div>\n

The IMF\u2019s Deadly Economic Medicine<\/strong><\/p>\n

It\u2019s the\u00a0standard IMF economic medicine, the so-called \u201ceconomic package\u201d (paquetazo) \u00a0imposed on indebted countries. It sets \u00a0the\u00a0stage for a major dislocation of Ecuador\u2019s national economy.<\/p>\n

Quite deliberately, the policies of the IMF are intended to impoverish an entire country, take over Ecuador\u2019s oil economy. The IMF acts on behalf of Wall Street and the \u201cWashington Consensus\u201d.<\/p>\n

While the IMF policy conditionalities are couched in\u00a0technical\u00a0jargon, the objectives are crystal clear (emphasis added):<\/p>\n

The authorities\u2019 measures are geared towards strengthening the fiscal position<\/strong> and improving competitiveness and by so doing help lessen vulnerabilities, put dollarization on a stronger footing, and, over time, encourage growth and job creation<\/strong>.[Nonsensical statement]<\/em><\/p>\n

\u201cAchieving a robust fiscal position<\/em><\/strong> is at the core of the authorities\u2019 program, which will be supported by a three-year extended arrangement from the IMF. The aim is to reduce debt-to- GDP ratio through a combination of a wage bill realignment<\/strong>, a careful and gradual optimization of fuel subsidies,\u201d\u00a0<\/strong><\/em><\/p><\/blockquote>\n

What is the meaning of<\/p>\n

\u201cA combination of a wage bill realignment, a careful and gradual optimization of fuel subsidies\u201d?<\/em><\/p><\/blockquote>\n

Answer:<\/p>\n

Massive layoffs in the public sector, dramatic hikes in fuel prices, reduction in real wages, the privatization of pension funds, the\u00a0privatization\u00a0of health and\u00a0education.<\/em><\/p><\/blockquote>\n

The price of diesel more than doubled overnight leading to the paralysis of public transportation.\u00a0Gasoline prices increased by 29%.<\/p>\n

The media will say that gasoline was subsidized. This is a misleading statement. Ecuador is the largest oil economy in South America after Venezuela. It has ample surpluses of crude oil. It sells oil locally at a price which is lower than the export price also with a view to supporting local industries. \u00a0This is a standard practice in many oil producing economies.<\/p>\n

These dramatic hikes in fuel prices contribute to destabilizing all major sectors of the national economy. They immediately trigger inflation and a collapse in purchasing power, the contribute to the\u00a0paralysis of public transport as well as internal commodity trade.<\/p>\n

\"\"<\/a>

Ecuador Protests, October 2019<\/p><\/div>\n

Fake IMF Loan<\/strong><\/p>\n

The dollar denominated external debt of Ecuador has skyrocketed.<\/p>\n

The $4.2 billion loan does not contribute to an increase in financial resources for Ecuador. Quite the opposite. The IMF loan\u00a0is tagged for the reimbursement of Ecuador\u2019s external debt obligations. It comes in and it goes out. New loans to pay back old debts. It is fake loan. What it does is to \u201csubsidise\u201d Ecuador\u2019s external creditors.<\/p>\n

We cannot pay our debt servicing obligations. No problem says the IMF: we will lend you the money and with that money you will pay us back, namely the IMF loan is a \u201csafety net\u201d for Ecuador\u2019s external creditors, namely Wall Street.<\/p>\n

Ecuador no longer has control over its fiscal and monetary policy.<\/p>\n

It\u2019s central bank has been transformed into a colonial style currency board.<\/p>\n

The entire financial system is dollarised, namely the US Federal Reserve and Wall Street ultimately call the shots.<\/p>\n

In a dollarised economy, internal debts become external debts expressed in US dollars.<\/p>\n

An entire nation has been impoverished.<\/p>\n

The external debt goes fly hight. Macro-economic policies are controlled by the creditors.<\/p>\n

**************<\/p>\n

\n

(Click to Read)<\/a>\u00a0The IMF Report<\/a><\/h2>\n<\/blockquote>\n

\"\"<\/a>Executive Summary<\/strong><\/p>\n

Context: The authorities face a difficult situation. Wage increases have outpaced productivity growth<\/strong>\u00a0[IMF calls for a reduction in real wages] over the past decade which, has led to a deterioration in competitiveness. This has been exacerbated by a strong U.S. dollar\u2014Ecuador\u2019s economy is fully dollarized\u2014leaving the real exchange rate overvalued. <\/strong>[engineered by Wall Street]<\/p>\n

Public debt is high and rising, the government faces sizable gross financing needs, and international reserves are precariously low. The recent volatility in oil prices and tighter global financial conditions have exacerbated these strains.<\/p>\n

Article IV: The Article IV discussions focused on diagnosing the nature of the imbalances facing Ecuador and the policy changes that will be needed to address them. At the center of the discussion was the proper calibration of the size, pace, and composition of the reduction in the fiscal deficit<\/strong> that will be needed in the coming years. [implementation \u00a0of drastic austerity measures] In addition, there was broad agreement that fundamental supply-side efforts will be needed to foster competitiveness, create jobs, rebuild institutions, and make Ecuador a more attractive destination for private investment. Finally, improving the social safety net and increasing the effectiveness of public spending, particularly on health and education, will be essential to achieving strong, sustained, and socially equitable growth.<\/p>\n

Program Objectives: Consistent with the findings of the Article IV, the authorities\u2019 policy plan seeks to decisively address the systemic vulnerabilities facing Ecuador. The goals of these policies are to boost competitiveness and job creation, protect the poor and most vulnerable, fortify the institutional foundations for dollarization<\/strong>, [denies Ecuador to have an independent and sovereign monetary policy] and to improve transparency and good governance to public sector operations while strengthening the fight against corruption.<\/p>\n

Program Modalities: The proposed program would be a 36-month Extended Fund Facility with access of US$4.209 billion (SDR 3.035 billion, 435 percent of quota) <\/strong>[New loans to pay back outstanding foreign debts, harsh policy conditionalities<\/strong> imposed by creditors].<\/p>\n

The program has quarterly reviews and the full amount of Fund resources would be made available for direct budget support. Performance criteria have been established on the non-oil primary balance of the nonfinancial public sector (including fuel subsidies), net international reserves (excluding bank deposits held at the central bank), and on social assistance spending. There are continuous performance criteria to prevent new external payment arrears and to prohibit central bank financing of the nonfinancial public sector (both directly or indirectly through public banks). The program also includes a quarterly indicative target on the overall balance of the nonfinancial public sector.<\/p>\n

_______________________________________________<\/em><\/p>\n

\u00a0Read more: IMF Hands $4.2 Billion in Loans for Ecuador for Julian Assange<\/a><\/em><\/strong><\/p>\n

\"\"<\/a><\/em>Michel Chossudovsky is an award-winning author, Professor of Economics (emeritus) at the University of Ottawa, Founder and Director of the Centre for Research on Globalization (CRG), Montreal, Editor of Global Research.\u00a0 He has taught as visiting professor in Western Europe, Southeast Asia, the Pacific and Latin America. He has served as economic adviser to governments of developing countries and has acted as a consultant for several international organizations. He is the author of eleven books including\u00a0<\/em>The Globalization of Poverty and The New World Order\u00a0(2003<\/em>),\u00a0America\u2019s \u201cWar on Terrorism\u201d\u00a0(2005<\/em>),\u00a0The Global Economic Crisis, The Great Depression of the Twenty-first Century\u00a0(2009<\/em>) (Editor<\/em>),\u00a0Towards a World War III Scenario: The Dangers of Nuclear War\u00a0(2011<\/em>), The Globalization of War, America’s Long War against Humanity (2015<\/em>). He is a contributor to the<\/em> Encyclopaedia Britannica.\u00a0 His writings have been published in more than twenty languages.\u00a0In 2014, he was awarded the Gold Medal for Merit of the Republic of Serbia for his writings on NATO’s war of aggression against Yugoslavia. He can be reached at crgeditor@yahoo.com<\/a><\/em><\/p>\n

Copyright \u00a9 Prof Michel Chossudovsky<\/a>, Global Research, 2019<\/em><\/p>\n

Go to Original \u2013 globalresearch.ca<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

12 Oct 2019 – A popular insurrection is unfolding against the adoption of sweeping IMF reforms imposed by the government of President Lenin Moreno, aka Neocon Moreno. In March 2019, a 4.2 billion dollar IMF loan was granted to Ecuador: payment for Julian Assange\u2019s arrest.<\/p>\n","protected":false},"author":4,"featured_media":143077,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[53],"tags":[120,276,354,942,267,487,541,1504,545,109,287,941,985,874,70,126],"class_list":["post-145296","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-latin-america-and-the-caribbean","tag-conflict","tag-democracy","tag-economics","tag-ecuador","tag-geopolitics","tag-human-rights","tag-latin-america-caribbean","tag-lenin-moreno","tag-neoliberalism","tag-politics","tag-power","tag-rafael-correa","tag-social-justice","tag-socialism","tag-usa","tag-violence"],"_links":{"self":[{"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/posts\/145296","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/comments?post=145296"}],"version-history":[{"count":0,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/posts\/145296\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/media\/143077"}],"wp:attachment":[{"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/media?parent=145296"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/categories?post=145296"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/tags?post=145296"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}