Tensions will simmer in Ecuador despite subsidy U-turn

Significance

The move, designed to help meet IMF loan conditions, triggered two weeks of protests by indigenous movements, trade unions, students and others, which brought the country to a halt and threatened to topple the government. Heavy-handed police and military action exacerbated the violence, which resulted in hundreds of arrests and at least eight deaths. Moreno’s U-turn has put an end to the unrest for now but deep divisions (and IMF requirements) remain.

Impacts

• Correa and his supporters will seize on Moreno’s inability to maintain order and his decision to back down in the face of protests.
• Indigenous groups will be emboldened by Moreno’s U-turn and will continue resisting key elements of the government’s economic programme.
• Relations with the IMF have returned to centre stage and will shape the political landscape as the 2021 presidential elections approach.