Page last updated at 11:46 GMT, Saturday, 27 September 2008 12:46 UK

Ecuador's poor bank on referendum

By Daniel Schweimler
BBC South America correspondent

Ecuadors President Rafael Correa  in Guayaquil, Ecuador, on 25/09/08
Rafael Correa has bucked the trend of past presidents - with a popularity rise
The people of Ecuador are voting on Sunday on some of the most wide-ranging proposals the country - any country in the region - has ever seen.

The almost 10 million-strong electorate is being asked for a simple "yes" or "no" to President Rafael Correa's 444-article plan for the future.

These are some of the more controversial proposals:

  • The state to tighten control of vital industries such as oil, mining and telecommunications and reduce monopolies
  • Some foreign loans to be declared illegitimate, which could allow the government to stop debt repayments
  • The state allowed to expropriate and redistribute idle farm land and ban large land-holdings
  • The president allowed to stand for a second four-year term in office
  • Free health care for older citizens
  • Civil marriage for gay partners

President Correa, a 45-year-old US-trained economist, says he is fulfilling the promises he made when he won elections nearly two years ago.

He was elected following years of turmoil in Ecuador which saw angry crowds throw three presidents from office in the previous 10 years.

Stiff opposition

Mr Correa said he wanted to alleviate poverty, especially among the large indigenous community.

Student supporters of the proposed new constitution in Guayaquil, Ecuador, on 25/09/08
Many Ecuadorians hope to see an end to the era of poverty and exploitation

He said he wanted to ensure a fairer distribution of wealth in a country that had long been governed by a small business- and land-owning elite.

And he said he wanted foreign investors to pay a fairer share for the oil they extracted from Ecuadorean soil.

Many people, disillusioned after generations of broken promises from their politicians, were dubious.

But President Correa has won many of them over with his determination to push ahead with his reforms in the shape of the new constitution.

He faces stiff opposition, especially from the business community, centred in the major Pacific coastal city of Guayaquil.

The director of the Ecuadorean Business Committee, Roberto Aspiazu, said most business leaders would vote "no" to the changes or spoil their ballot papers.

He said the proposed constitution heralded what he called "a totally statist model".

Mr Aspiazu said the new rules would allow the state to intervene in business.

He was particularly concerned about the plans to expropriate and redistribute land - measures that he said could fall victim to subjective criteria.

Like many of President Correa's opponents in Ecuador, Mr Aspiazu accused him of being too close to the radical president of Venezuela, Hugo Chavez.

Mr Correa has, since he started campaigning for the presidency, had to fight off allegations that he is President Chavez's puppet.

He admits to being his friend and they often meet, but Mr Correa has often repeated that he is an Ecuadorean president, working for Ecuador.

Another opposition accusation is that the new constitution would concentrate excessive power in the hands of the president, making him too authoritarian.

However, the president has seen his popularity rise, especially in remote indigenous and poor communities where schools, hospitals and housing have been built.

And opinion polls suggest that Sunday's "Yes" vote will win with anything between 55% to 60% of the vote.

The "Yes" campaign needs 50% plus one for victory.

Worried investors

Analysts say that raised expectations among Ecuador's many poor could be another danger for President Correa, especially if he fails to win approval for the new constitution on Sunday.

Hundreds of thousands of people left the country, mostly for the United States and Europe - many after the last major economic crisis in 2000, which saw Ecuador adopt the US dollar as its official currency.

Opponents of the new constitution in Guayaquil, Ecuador, on 25/09/08
Investors worry what it means for doing business with Ecuador in future

Ecuador is the world's largest banana producer but its economy is driven largely by oil exports and remittances sent home by its migrant workers.

The reforms that Rafael Correa, a devout Roman Catholic, is planning to implement in Ecuador are similar to changes being introduced in many parts of Latin America - particularly Venezuela and Bolivia.

Like many leaders in the region, Mr Correa is trying to break the mould of government by a small group of wealthy landowners and businessmen and give a greater say to the poor and indigenous populations.

He has been critical of foreign business investors, earlier this week taking control of the assets of a Brazilian company he accused of mis-management over the building of a dam in Ecuador.

He has also said he will close the US military base at Manta on the Pacific coast.

Many foreign and local investors will be waiting for the result of Sunday's referendum, worried about the terms under which they will be doing business in Ecuador in the future.

Meanwhile, the country's poor and indigenous people, who say that for too long they have been exploited and unheard, will be campaigning for a convincing "Yes" vote, hoping that it heralds for them and for Ecuador, a new dawn.

Ecuador draft constitution passed
25 Jul 08 |  Americas
Ecuador state seizes TV stations
08 Jul 08 |  Americas
Ecuador plans foreign bases ban
02 Apr 08 |  Americas
Ecuador forum dissolves Congress
30 Nov 07 |  Americas
Country profile: Ecuador
16 Apr 08 |  Country profiles

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