Ecuador’s Government, Transgressing

In June, major business groups including the NAM wrote U.S. Trade Representative Ron Kirk urging his careful review of Ecuador’s trade preferences under the Andean Trade Promotion and Drug Eradication Act. The government of Rafael Correra had undermined the rule of law, the letter argued, noting:

In particular, there are serious concerns within the U.S. business community about breaches of the basic rule of law that are occurring in Ecuador, contrary to the basic eligibility requirements of section 203(c). As found by the State Department in its annual human rights report on
Ecuador released in February 2009, there are concerns with “corruption and the denial of due process within [Ecuador’s] judicial system.” U.S. businesses have also continued to see Ecuador’s repudiation of its legal obligations to U.S. investors and a politicization of the judicial system.

The Obama Administration took these and other objections seriously, and the Administration’s report on Ecuador and Bolivia’s compliance with the trade act cited Ecuador’s serious violations. While denying Bolivia continued trade advantages under the law, the Administration extended Ecuador’s terms; still, Ecuador had been put on notice.

Correa doesn’t care. The Washington Times today takes editorial note of Ecuador’s recent, serious transgressions against the rule of law, international comity and democratic freedoms. From “Cut Off Ecuador“:

On July 15, Ecuadorean President Rafael Correa said that in his new role as president of the Union of South American Nations, he will try to create a regional organization to shut down critics in the media. This frightening move against a free press came two weeks after Mr. Correa began efforts to shut down Ecuador’s Teleamazonas television network.

On July 16, Ecuador’s state-owned Petroecuador oil company seized the oil fields of the Anglo-French Perenco Corp. This was despite a demand in May from an official arbitration body of the World Bank that the Ecuadorean government stop seizing oil. The expropriation of oil is nothing new. In 2006, Ecuador did the same thing to the American Occidental Petroleum Corp.

Most damning of all, Associated Press reported on July 17 that “an hourlong video” of a rebel leader “appears to dispel any doubts that Colombia’s largest rebel army gave money to the 2006 election campaign” of Mr. Correa.

This is the same government celebrated by the trial lawyers and activists who are pursuing a dishonest publicity campaign against Chevron, trying to bludgeon the company into settling a $27 billion lawsuit. (Ecuador laywyer, Pablo Fajardo: “President, this is my colleague, Steven Danziger.” Correa: “Wonderful. Keep it up!”) The debasement of Ecuador’s rule of law vitiates the legal claims against Chevron, which is why the activists are so fervent in their PR extortion.

In any case, with its active hostility against a neighboring democratic country and attacks against foreign investment, Ecuador has demonstrated its unworthiness to enjoy any trade advantages from the United States.

Join the discussion 3 Comments

  • Carter Wood says:

    You are repeating the spin, propaganda and falsehoods that have been fed to you.

    Texaco operated in a consortium with Petroecuador. Decisions were made in conjunction

    The judicial system has not been politicized? That’s laughable. Read this:

    SAN RAMON, Calif. – Sept. 12, 2008 – Earlier this week, Ecuador’s Prosecutor General indicted two Chevron attorneys associated with the company’s ongoing civil lawsuit between Chevron and 48 Ecuadorian plaintiffs. The politically motivated indictments mark a renewal of the Ecuadorian state’s attempts to disavow contractual obligations owed to Chevron from contracts signed in 1995 and 1998. The actions also ignore the findings of prior Prosecutor Generals who have repeatedly investigated fraud allegations and found them to be meritless.

    In response, Chevron Vice President and General Counsel Charles James issued the following statement:

    “By issuing these baseless indictments, it is clear the government of Ecuador is trying to intimidate Chevron into forfeiting its legal rights. This outrageous tactic won’t work. Chevron intends to continue pursuing the rights it is owed under the law and its agreements with the government of Ecuador.

    “Recent events in Ecuador leave no doubt that there is improper collaboration between the government and plaintiffs’ lawyers. The systematic denial of Chevron’s right to a fair trial is obvious, and it is clear that the proceeding has been thoroughly corrupted. By persecuting Chevron’s counsel and collaborating with the plaintiffs to undermine Chevron’s legal rights, Ecuador’s government has intervened in the legal proceeding. The Ecuadorian state continues to call into serious question the legitimacy of its judiciary and its commitment to the rule of law.”

    Etc. The documentary-style movie, Crude, ends with a testimony from the Chevron lawyer and then immediately cuts to a note about the indictments. It’s evokes a laugh, which is too bad, because it’s a foreign government using the weight of its judiciary to target innocent people.

    Sorry to distract with the facts.

  • Kate says:

    Mr. Wood cannot be serious with this accusation. While President Correa has expressed sympathy for the victims of the environmental contamination, there is simply no evidence to support the notion that those comments somehow constitute a politicization of the judicial system. Perhaps activists are “so fervent” because the fact remains that when Texaco (now Chevron) was the SOLE operator from 1964 to 1992, the entire system was second-rate and caused extensive contamination. It is responsible not only for the contamination resulting from the time it explored for oil but also the contamination that flowed later as a result of a substandard system that it built in order to save money. It seems to me that at some point, Chevron is going to have to own up to its responsibility here and stop distracting the public with facts that have been distorted and taken out of context.

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