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Heads up – Embassy 9 – June 2008

Ecuador – Man on a mission

Eduardo Cabezas couldn’t stay away from London for long. Ecuador’s Ambassador has returned to the capital on the orders of his vigorous young president, Rafael Correa – and he comes with news about the radical changes in his country since he served here five short years ago.

“Our President doesn’t go by the rules – he pushes the rules because he wants poor people to benefit from his policies,” says Cabezas, describing how President Correa has completely recast traditional right-left politics in Ecuador.

Following a referendum, in which his Alianza Pais alliance swept the boards, a constituent assembly has been established which is rewriting the rule books in Ecuador.

The work of the assembly is due to finish in July, after which the new constitution will be put to a vote.

The Ambassador, a specialist in economic diplomacy, a central banker and one-time finance minister, describes how the economic ideology in Ecuador has changed: “The most important difference is the inclusivity of the new economic model,” he says, “especially for the poor people.”

The President practises what he preaches, adds Cabezas, who says Correa has forgone expensive gifts from foreign heads of state and the luxuries of the presidential palace in a favour of his modest home.

He has declared a war on graft, while petrodollars from the high oil prices have been channelled into pro-poor programmes, and energy has been subsidised to shield the poor from price hikes.

Refuting critics who call Correa a puppet of Venezuela’s Hugo Chavez, the Ambassador says the president has his own brand of economics and prefers the counsel of two Nobel laureates, anti-globalisation firebrand Joseph Stiglitz and micro-finance guru Muhammad Yunus.

But his redistributive policies have angered the privileged classes and worried foreign investors who are having to renegotiate their bilateral investment treaties so that the local population gets a fairer share of the profits.

Another radical policy is the President’s decision not to extract oil from ecologically sensitive areas in Ecuador, amounting to 100 million barrels, at a time when oil prices are rising sharply.

But the Ambassador defends the project, saying: “This is an important project of international significance to prevent global warming, to reduce pollution and to preserve biodiversity.”

The Ambassador admits that some of these policies have not been received well in the UK and he regrets that relations have deteriorated since he was last in London. He will be working energetically to put relations back on track, he says.

In particular, he will reinforce the message that Ecuador’s sovereignty is to respected – a direct reference to the recent incursion of troops from neighbouring Colombia in operations against FARC rebels, which led to a tense diplomatic stand-off between the two countries.

“Ecuador has solved its territorial disputes and we are a country of peace now,” insists the Ambassador, who himself, was instrumental in implementing the highly successful peace and development programme with Peru.

He also hopes to negotiate more debt relief, promising that the funds will be used on social programmes. It is a tall order, he admits, since much of Britain’s aid to Latin America is channelled through EU programmes.

The Ambassador also wants to coax Ecuadorians living in the UK to return home to participate in the new economy. Alarmed at the scale of migration out of Ecuador since the economic collapse of 1999, the government has put aside funds to help economic migrants return home.

He also wants ordinary Britons to visit Ecuador to enjoy the variety of its beaches, mountains and Amazonian jungles. He hopes to forge partnerships with British NGOs concerned with preserving Ecuador’s astonishing biodiversity and has already established links with the Prince’s Trust.

This is a brief that lesser diplomats would find daunting, but Cabezas has never shied away from a challenge throughout his colourful career, which included him and 70 other officials (including 11 OPEC ministers) being kidnapped in 1975 by the notorious terrorist Carlos the Jackal.

He was also drafted in to implement the dollarisation of the Ecuadorian monetary system after massive defaults in 1999 – an unpopular policy which hit pensioners hard and resulted in a short-lived coup, but which also stabilised the economy.

Cabezas, it seems, is the diplomatic equivalent of Mr Fix It, with no problem too big for him to handle – which is probably why President Correa has sent him back to London.

HE Eduardo Cabezas

“The President had decided not
to extract oil in ecologically
sensitive areas in Ecuador. This is
an important long-term project
of international significance
to prevent global warming, to
reduce pollution and to preserve

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