Ecuadorian president Rafael Correa will push through a set of constitutional amendments before the end of this year. The amendments will likely produce more polarisation in the country, with the business climate worsening as a result.
Ecuador’s left-leaning president Rafeal Correa announced he would be backing a constitutional amendment to eliminate presidential term limits in May this year. Despite his many statements that he would not be seeking a fourth term in office, the move was widely expected. With a supermajority in Ecuador’s national assembly, it was not too difficult. His party, Alianza País, sent a bill to the constitutional court for approval, and the court ruled in late October that the national assembly could vote on the bill. On top of indefinite reelection, the bill features other constitutional changes as well.
The National Assembly intends to vote on the bill before the end of the year, and has already started the voting procedure. The government has little to worry about, however, with 105 out of 137 seats in the Assembly – more than enough for the required two-thirds majority. Attempts by opposition party to turn the vote into a popular referendum were also rejected by the Constitutional Court.
But the opposition is now organising the 584,000 signatures necessary to force the referendum through regardless. Although Correa had an impressive approval rating of 72% in October, the majority of voters are in favour of a plebiscite on the abolishment of term limits. The opposition thus still has a reasonable chance of blocking the amendments. Yet, even in a referendum the government will stand a chance to push the reforms through.
Two changes out of the 17 proposed amendments stand out: the elimination of term limits and internal deployment of the armed forces.
The elimination of term limits, for all public executive posts including the presidency, has sparked the most debate in Ecuador. Correa defended the proposal, saying ‘Reelection does not make anyone a president, it only allows them to be a candidate.” But opposition party CREO has stated that alternating power is the essence of democracy, and that this moves prevents exactly that. Under the 2008 constitution, executive officials are allowed only two terms.
Abolishing term limits poses a threat to institutional stability in any country. As incumbent presidents gain increasing control over the state apparatus, they acquire more means to also win the following elections. This is especially true in Ecuador and other Latin American countries, where sitting presidents often have a large advantage in competitive elections. But the threat is often smaller than Ecuador’s opposition imagines it to be. In Peru, president Fujimori was booted out of office within a year of his second reelection, after tinkering with term limits. Venezuela’s Hugo Chávez died of cancer before he could be sworn in for his first term after having abolished term limits.
The same is likely to happen in Ecuador: unlimited reelection will not give Rafael Correa a carte blanche to do whatever suits him. Despite his popularity, voters are these days much more critical towards any government, although this does not mean there are no institutional risks to this move. For business, it means that a stable relationship with the government is even more important, however, given the real chance that Correa will be reelected in 2017.
Insecure about security
A more direct concern is that the army will be allowed to maintain the ‘integral security of the state’ under the amendment. Correa’s relationship with the Ecuadorian police forces has been shaky, especially since a police rebellion in 2010 which had Correa locked up in a hospital, in what some deemed a coup d’état. As a result, he has employed the army on occasions for internal security, at the expense of the police. The amendment seeks to provide a constitutional basis for that.
Employing the army in domestic situations is not necessarily dangerous. But the amendment may worsen Correa’s relation with the police. Although violent crime has been on the wane over the past few years, the country’s security situation could suffer as a result, if coordination between the police and the government deteriorates. Political tensions between Correa, the army, and the police forces could also provoke further political instability, with the 2010 incident as an example of what could happen. Correa has argued, however, that the Armed Forces can be used now for pressing problems such as arms and drugs smuggling, potentially curbing such crimes.
Virtues and vices
The controversy is not limited to reelection and rules for the army. Other debatable issues are the limiting of the powers of the national budget audit institution (Contraloría del Estado), more stringent requirements for organising local referenda, and a redefinition of the media landscape. Not all measures will have an impact on the stability of the state’s institutions – some measures are practical changes. But at the very least, the measures are likely to spark more polarisation in Ecuador, creating a tenser political environment.
The country is unlikely to go in the direction of Venezuela in the short-term, where the majority of state institutions were openly subjected to Chávez’s control. But these amendments are a product of a larger problem: In Ecuador, the rules of the political game are as much a subject of debate as the game itself.
The 2008 Constitution, instigated by Correa but drafted by a diverse Constituent Assembly, was an attempt to overcome this very problem. But within six years, the constitution itself is already under discussion again. Even if the changes do not cause major harm, they still promote a tradition of ‘whomever is in office changes the rules’.
For businesses and organisations invested in Ecuador, this means they will have to factor in a future reelection of Rafael Correa, as well as potential further changing of the rules of the game. This increases the value of maintaining good relations with the government, and resisting the urge to rally against the government’s policies.
But becoming too friendly with the government is also a risk, in the event the opposition manages to pull together and win an election in future. Hedging political risks, and above all staying aloof from overt politics, is therefore essential for businesses.