* Ecuador already hosting WikiLeaks' Assange at UK embassy
* President Correa buoyant after sweeping re-election this
* Trade benefits with United States could be put at risk
By Alexandra Valencia
QUITO, June 23 Tiny Ecuador is once again at the
center of an international diplomatic saga over U.S. data
secrecy that will thrust the country's leftist President Rafael
Correa into the limelight and stir fresh controversy with
The government of the South American nation of just 15
million people, which has thumbed its nose at the West before,
said on Sunday that fugitive former U.S. intelligence contractor
Edward Snowden had asked it for asylum.
Ecuadorean Foreign Minister Ricardo Patino was due to give
more details on Monday during a visit to Vietnam.
Anti-secrecy group WikiLeaks, whose founder Julian Assange
has spent a year taking refuge in Ecuador's embassy in London,
said the American fugitive was bound for Quito via "a safe
route" from his current location in Moscow. He flew to Moscow
from Hong Kong on Sunday.
"They should give him (Snowden) political asylum because we
all have the right to freedom and no country or government such
as the United States can override that," said Yolanda Acosta,
35, a small business owner in Quito.
If Correa's administration does give sanctuary to Snowden,
it would put a new strain on relations with the United States,
which had appeared to be improving in recent weeks despite
strong disagreement over the year-old Assange case.
"If they gave asylum to Assange, in very complicated
conditions, they have to give it to Snowden," said Alberto
Acosta, a former energy minister in Correa's government.
Correa has said Assange is right to fear that if he leaves
the embassy in London he might be sent from Sweden, where he is
accused of sexual assault, to the United States to face charges
over WikiLeaks' publication of thousands of secret U.S. cables
Correa, 50, a vocal member of an alliance of left-wing Latin
American presidents who was a close friend of Venezuela's late
socialist leader Hugo Chavez, is riding high after winning
re-election in February with about 57 percent of the vote.
He has won broad support from Ecuador's low-income majority
thanks to heavy spending on welfare, health, education and
infrastructure projects. But the U.S.-trained economist also has
irked investors with his anti-capitalist rhetoric.
Correa has pushed through a new constitution that gave him
more power, and this month passed a controversial law creating a
state watchdog to regulate media content. Critics called the
move a blow to free speech, while supporters say it enshrines
principles of balance.
Michael Shifter, president of the Inter-American Dialogue, a
think tank focused on U.S. relations with Latin America, said
another chance to defy the United States again was probably
irresistible for Ecuador's pugnacious president.
"It's hard to argue that it's a matter of principle given
what's going on in Ecuador with the recent communications law
and the severe limits on press freedom there," he said.
"There is a real irony ... But of all the Latin American
countries, Correa is the one who's most willing to stand up to
the United States. He'll couch it in terms of principle but I
think this is all about defying the United States."
Correa has seldom shied away from a fight, be it with the
Roman Catholic Church, international bondholders or local media
bosses, many of whom he says are corrupt and manipulative.
Any further deterioration in ties with Washington now could
put at risk Ecuador's trade benefits under the Andean Trade
Preferences Act, which dates to the early 1990s.
Congress first passed the program in 1991 to help create
jobs in the region and discourage the illegal drug trade. It
allowed Colombia, Peru, Bolivia and Ecuador to ship thousands of
goods to the United States without paying duties.
Ecuador is now the sole beneficiary of the program since
Colombia and Peru have negotiated free-trade pacts with the
United States and the White House suspended Bolivia in 2008,
saying it had failed to cooperation in the U.S. war on drugs.
The trade program is set to expire next month unless
Congress votes to renew it. Several U.S. business groups have
called for Ecuador's trade benefits be terminated or reduced.
Most of those calls are based in part on Chevron Corp's
long-running legal battle with Ecuador over pollution
blamed on Texaco, which Chevron purchased in 2001.
An Ecuador court ruled against Chevron in 2011 and later
increased the damages stemming from the decision to $19 billion
from $18.2 billion. Chevron says Texaco settled the case with
Ecuador in 1998 and the ruling against it was obtained by fraud.
A tough stance from Quito against Washington on the Snowden
case would likely have won firm backing from Chavez, whose death
this year from cancer led Correa to weep in public.
Following Chavez's departure, Correa said he was not
interested in replacing his late friend as the most vocal
figurehead of Latin America's socialist leaders.
"He's not seeking to replace Chavez as a regional leader,"
Shifter said. "He is, though, trying to occupy some of the
rhetorical space Chavez occupied, and this is a very tempting
issue to seize on."