President Rafael Correa addressed the difficult economic situation facing Ecuador on his Twitter account August 24, citing the negative effects of the U.S. dollar’s appreciation and falling oil prices, which reached a six year low, but commented, “We will move forward,” anticipating that his government will take steps to maintain macro-economic equilibrium.
He insisted that safeguard surcharges imposed last March on a third of the country’s imports were necessary to avoid the exit of hard currency, but described them as only “palliative,” since the country has no currency of its own with which to implement monetary policies.
The Andes news agency recalled that the U.S. dollar has been the country’s only circulating currency since 2000, and it has been appreciating rapidly over the last few months, while the currencies of neighboring countries such as Colombia and Peru have been devalued. This has the effect of making Ecuadoran exports more expensive, and reducing the prices of imports.
Correa reported that measures have been taken to support the border province of Carchi, where commerce has fallen significantly as result of the Colombian devaluation.
On Monday, August 24, Latin America’s principal currencies reached 22 year lows in comparison to the U.S. dollar.
