November 10, 2011 / 6:41 PM / 8 years ago

UPDATE 2-Ecuador appoints key economic officials

* Correa names 15 officials to high ranking posts

* Cabinet in full resigned in late October

* Analyst says changes do not signal change in govt policy (Adds comments from Correa, analysts)

By Alexandra Valencia and Eduardo Garcia

QUITO, Nov 10 (Reuters) - Ecuador’s President Rafael Correa appointed two long-term allies as political economy minister and head of the Andean country’s central bank on Thursday as part of a wide-ranging cabinet reshuffle.

Jeannette Sanchez was named political economy minister, the government’s top economic job. She was previously the social development minister, the official in charge of coordinating efforts to fight poverty and improve living standards.

Correa described new central bank president Pedro Delgado as “a good friend.” Delgado has long experience in the banking sector and was heading a government body overseeing payments to depositors from collapsed banks.

“It was necessary to reshuffle the cabinet and we do it at a time when support for the government is peaking ... we’ll continue with economic policies to underpin the kind of social development that is fair, balanced and democratic,” Correa said after announcing the changes.

The appointments followed the resignation of the whole cabinet in late October. Correa has asked all his ministers and close advisers to resign several times since he first took office in 2007. He tends to reappoint most of them after assessing their performance and the needs for policy changes.

High oil prices have let him boost spending on hospitals, roads and schools, which has improved Correa’s popularity among the poor and put him in a good position for a likely re-election bid in 2013.

Karen Hooper, a Latin American analyst with political risk consultancy Stratfor, said that by reshuffling his cabinet on a regular basis Correa retains loyalty from his ministers while preventing any one individual from gaining too much influence.

“I do not expect any significant policy shifts from this. Notably, he does not appear to be sidelining any individual but is instead essentially shuffling them around,” she said.

In all, Correa made 15 appointments, including that of Santiago Leon as minister for production to replace Nathalie Cely, who will become Ecuador’s ambassador to Washington.

Cely’s appointment signals the end of a diplomatic row with the United States that began in April when Correa expelled the U.S. ambassador over U.S. diplomatic cables released by WikiLeaks that suggested Correa was aware of corrupt police practices.


Ecuador currently produces around 500,000 barrels of oil a day and is OPEC’s smallest member. Although Correa is trying to diversify the economy away from its dependence on crude, economic growth in the country depends chiefly on oil prices.

The government’s 2012 budget bill forecasts economic growth next year of 5.35 percent, and the economy will likely grow above the 5.24 percent target for this year.

“Ecuador’s rapid pace of recent growth has been built on rising (oil) prices ... With energy prices more likely to fall back than rise over the next 6-12 months, we expect the economy to slow substantially in 2012,” Capital Economics said in a report earlier this week.

Price increases are also a concern. Inflation in the first ten months of 2011 was 4.67 percent, already above the government’s target for 2011, and the government expects annual inflation at 5.14 percent in 2012. [ID:nN1E7A80HM]

Ecuador adopted the U.S. dollar as its currency in 2000 in the aftermath of a debt default, which limits the central bank’s monetary policy tools. (Additional reporting by Jose Llangari; Writing by Eduardo Garcia; Editing by Jackie Frank)

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below