What Happened: Ecuadorian President Lenin Moreno has repealed a controversial decree abolishing fuel subsidies, restoring them in their original form, the BBC reported Oct. 14. Moreno added that he was willing to consider revising sweeping austerity measures, including plans to cut salaries for government employees. After the announcement, protest leaders said they terminated their mobilization efforts to oppose the fuel subsidy cuts.
Why It Matters: The surprise compromise meets the protesters' key demand and should quell most of the unrest that has been grappling the country for over a week. The Ecuadorian government must now adjust its efforts to comply with an International Monetary Fund loan, something the reversal of additional austerity measures could jeopardize.
Background: Moreno faces a tough re-election campaign in 2021 due in large part to a continued challenge from his exiled predecessor, Rafael Correa. In previous days, Moreno has managed to strike deals with transportation unions to grant fuel credits and boost fares. Pressure on oil revenues, which make up 25 percent of government income, may have forced Moreno to seek a quick de-escalation.
Read More:
- Ecuador: A Spasm of Unrest Threatens the Government (Oct. 8, 2019)
- Ecuador Takes a Business-Friendly Turn (July 2, 2018)
