(Minister of Finance)
|Responsible for overseeing the nation's public finances.|
The Ministry of Economy and Finance is a cabinet ministry of the government of Ecuador responsible for overseeing the nation's public finances.
In 2005, Raphael Correa (who became president in 2007) was appointed to the position of Minister of Economy and Finance in the government of President Alfredo Palacio, having previously advised Palacio before his ascension to the presidency. As finance minister, Correa met with a number of Latin American presidents, including Brazil's Luiz Inácio Lula da Silva, Argentina's Nestor Kirchner, and Venezuela's Hugo Chávez. In this position, he also publicly criticized the United States, describing U.S. President George W. Bush as "dim witted", and stating that Chávez's comparison of Bush with the Devil was unfair to the latter. He therefore established himself as both a political maverick and a staunch critic of economic neoliberalism.
Correa argued for reforms to be made to a fund that had been established on the advice of the International Monetary Fund in 2002 to collect and distribute Ecuador's oil revenue. Correa believed that the fund unjustly allocated the wealth generated by the country's oil; 70% of it went to pay back foreign debt, while 20% was set aside to stabilize oil revenues and 10% was spent on health and education programs. Given that over half of Ecuador's population were deemed to be living in poverty, Correa convinced Congress that a greater share of the fund should be spent on social programs to alleviate the effects of poverty; as a result, the portion spent on debt repayment was reduced to 50% and that allocated to health and education was increased to 30%. The World Bank responded by cancelling its previously approved loan to Ecuador, with Palacio holding Correa responsible for this action.
Following the incident, Correa resigned from Palacio's government. He had also proposed the issuance of government bonds at a lower interest rate than the 8.5% prevailing one at that time. Venezuela's government was to purchase half of the new bond issue. Correa claimed in his resignation letter that the sale was done with full presidential authorization, but cited lack of support from the president as a factor in his decision to resign. When Correa resigned as minister, polls showed he had the highest credibility of any official in the administration at the time, with 57% of Ecuadorians saying that they trusted him.
An Office Holder on Wikispooks
|Rafael Correa||20 April 2005||9 August 2005|
- https://web.archive.org/web/20051217142440/http://www.zmag.org/content/showarticle.cfm?ItemID=8516 Sovereignty Takes One Step Backwards