NewsThe keys to the new tension between the Government of Ecuador and...

    The keys to the new tension between the Government of Ecuador and peasant and indigenous organizations

    After the national strike carried out last June by the Confederation of Indigenous Nationalities of Ecuador (Conaie), the National Confederation of Peasant, Indigenous and Black Organizations (Fenocin) and the Council of Evangelical Indigenous Peoples and Organizations of Ecuador (Feine), there are currently new tensions with the government.

    Fenocin has warned against carrying out new mobilizations in the coastal region of the country, in demand for compliance with the agreements reached during the technical dialogue tables that were installed after the national strike and for the increase in the amount for the forgiveness of debts to social organizations.

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    In principle, they were scheduled to mobilize on November 15 in four coastal provinces of the country, but the protests were suspended. This Thursday there will be an assembly in which they will define the actions to be taken.

    What was established in the dialogue?

    The issue of debt forgiveness was dealt with at the second of the 10 tables that were set up after the strike, which was called ‘Public, private and cooperative banks’.

    Several measures were reached at that table last July, as reported by the Ministry of Government at the time. Among them is the debt forgiveness up to $3,000, expired until May 31, 2022, in the public bank BanEcuador; something that had already been approved by the Government during the protests.

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    The keys to the new tension between the Government of Ecuador and peasant and indigenous organizations

    Another measure established that credit amounts from 3,000 to 10,000 dollars may be restructured and requalifiedwith a flexible payment with a three-year grace period and a term of up to 10 years.

    However, as Conaie published on that occasion, BanEcuador also promised to forgive “credits or loan assets of up to $10,000 in capital, plus interest and other costs and commissions, and that are considered unrecoverable.”

    What does the Phenocin ask for?

    What the Fenocin requires is that an executive decree establishes the forgiveness of overdue loans between 3,001 and 10,000 dollars plus interest, as was done with debts of up to 3,000 dollars.

    Demand that debtors be considered from 2022 backwards, because some people have debts of up to 20 years that are irrecoverable; and that once the debt is forgiven, these citizens are withdrawn from the risk center.

    It also requests that small rural producers, as well as ranchers and fishermen, be considered among the beneficiaries.

    The keys to the new tension between the Government of Ecuador and peasant and indigenous organizations

    Fenocin requests compliance with article 196 of the Organic Law for Economic Development and Fiscal Sustainability, approved in November 2021, which provides that public financial entities forgive credits or loan assets of up to $10,000.

    The organization also requested the forgiveness of overdue debts at BIESS, which is the bank of the Ecuadorian Institute of Social Security (IESS).

    The government’s response

    According to data from the Ecuadorian Ministry of Government, after the agreements reached at the dialogue tables, “33,145 debt operations received financial relief.”

    Of these, the institution points out, 7,227 took advantage of the extraordinary and temporary financial relief mechanisms for a total of 226,425,261 dollars in public and private banks; while 25,928 operations of up to 3,000 dollars were forgiven, for an amount of 58,857,358 dollars in BanEcuador.

    At the request of the Fenocin, on November 7, the Minister of Government, Francisco Jimenez, said that there was already a draft decree to establish the forgiveness of debts and that the benefit would be for loans of up to 10,000.

    The keys to the new tension between the Government of Ecuador and peasant and indigenous organizations

    “There is a law [la de Desarrollo Economico y Sostenibilidad Fiscal] that it came out to combat the effects of the pandemic that established the ceiling of up to 10,000 dollars and that was endorsed at the dialogue table. Any debt forgiveness process involves a moral hazard, that is, that people get used to this facility and do not pay. That’s why it has to be done in a reasoned way,” he said then.

    However, the Government backed down and announced that these debts will not be forgiven. Through a release published on Tuesday, the Ministry of Government said that “There is currently no financial feasibility to increase said mechanism”.

    In interview with ecuavisa, Jimenez qualified his previous statements on Wednesday. Thus, he pointed out that article 196 of the Economic Development and Fiscal Sustainability Law “grants a power to public institutions so that they can forgive up to 10,000 dollars”, but “it is not an imposition or an obligation”.

    In this regard, the Minister of Economy and Finance, Pablo Arosemena, also referred, who assured that BanEcuador cannot stop collecting debts, because it would affect its ability to disburse more credits. In this sense, he indicated that the bank would stop receiving income for 190 million dollars if those loans were forgiven.

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    “As the Ministry of Finance we are members of BanEcuador’s Board of Directors and we we are not going to support that measure“, he expressed during a conversation with the media last Tuesday.

    Patricia Borja, lawyer and author of the book ‘The decapitalization of the IESS pension fund vs. the right of members’, commented on his Twitter account that, in accordance with article 22 of the BIESS Law, this bank is prohibited from “forgiving the obligations in his favor.”

    While, he said, the Constitution in its article 372 provides that “no State institution may intervene or dispose of the funds and reserves, nor impair the assets of the IESS.”

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    Source: RT

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