start here

start here

The Daily IKN email digest, get all daily posts sent to you next day (& no ads)

I say things on Twitter

10/9/08

Correa lays it out

"You callin' my pint a poof?"

Sometimes things are calm and quiet down here. Sometimes events hit you so fast it's not even worth trying to keep up. An example of the second was yesterday's Ecuador, when five separate events hit in the space of an afternoon. Here's a brief summary and a bit of opinion on each one.

Ivanhoe (IVAN) a N.Am oil and gas, signed a contract to develop a very large heavy crude field in the country. IVAN seems to have been chosen for the job due to their technical abilities in extracting from this kind of field, but also thanks to some recent effective lobbying from the Canadian government.

Brazil's Odebrecht was told that its alternative offer to fix up the mess they made of the hydro complex construction wasn't good enough and they were confirmed as officially kicked out. On its own this shows Studmuffin laying down the law to foreigners, but taken in conjunction with the IVAN oil news it's even more symbolic. What I think Correa is saying to the world (with the timing as much as the events themselves), is "We'll work with foreign investment, but not at any old price". He's been consistent with this message, and so yesterday fits that plan.

Galo Chiriboga, the Minister of Energy and Petroleum, resigned citing "strictly personal reasons". After hearing from certain people in certain places, I can confirm that Chiriboga resigned due to illness...namely he's sick to the stomach of being bossed and bullied by Correa. Chiriboga has already been replaced by Derlis Palacios.

Palacios worked with Correa in 2005 when Studmuffin was FinMin so they seem to have a decent working relationship, but the MEM top position will continue to be a figurehead...the real boss of MEM was, is and certainly will continue to be Correa, and anyone can remember back to the time Correa decreed the 99% windfall tax on oil companies and Chiriboga only found out about the move at the press conference will know what I'm talking about. As regards things inside the ministry, it's likely to delay the workings as the new boy works his new broom and then gets down to work. Plenty of papers to read on mining before he can open his mouth, that's for sure.....

Roberto Andrade, President of the BCE (Ecuador Central Bank) resigned "in deference to his President". This one is the most ominous, I think. It's either "lapdog in to control the BCE and do exactly what Correa says", or Andrade has just resigned in protest about that which Correa is ready to unleash on the world regarding the so-called "illegal debt". Whatever it is, it can't be good. Fear ye bond holders!

Ecuador's Chancellor announced that there was a concerted plan to undermine Correa's image abroad. This one is no big worldshaker on the surface, but it does show how Studmuffin has got his minions running around, getting busy and worried about keeping their jobs. This will go down very (repeat very) well amongst the rank and file in Ecuador, who applaud action from their politicos and are allergic to lazy fatcat donothings in the ministerial seats. They'll also like the man-of-action image that Correa is projecting on a general level.

All in all, yesterday was all about Correa standing up and saying "Hey! Who da man?" WHO DA MAN?", and the world shouts back "You da man!". Let's see where this new, strong Correa takes us.