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Ecuador’s Lasso eyes end to Correa’s revolution

The shelves of Guillermo Lasso’s office are lined with books that inform his politics: Adam Smith’s The Wealth of Nations; The Denationalization of Money by Friedrich Hayek; a compendium of cases about free speech from the Inter-American Court of Human Rights.

“A government cannot regulate freedom of expression,” the Ecuadorean conservative opposition leader told the Financial Times before Sunday’s presidential election, in which he won more than 28 per cent of the vote. The result will likely force a run-off against Lenín Boltaire Moreno, the anointed candidate of leftwing leader Rafael Correa.

He added: “At home I also have a long interview with Fidel Castro on my desk, because I’m curious to understand how people have built such mistaken doctrines.”

Discontent with Mr Correa’s rule and a pledge by the free marketeer Mr Lasso to create 1m jobs convinced more than a quarter of Ecuador’s electorate to back him.

With 98.5 per cent of votes counted Mr Moreno won the first round, with 39 per cent. Yet analysts cannot rule out the chance of Mr Lasso, a 61-year-old former banker from the port city of Guayaquil, who could cast April’s run-off as a referendum on Mr Correa’s legacy.

Cynthia Viteri, a centre-right former lawmaker who polled 16 per cent, has already indicated she would back Mr Lasso. If the opposition join forces, they could end Mr Correa’s decade-long “revolution”.

This would continue a trend in other parts of Latin America that has replaced leftwing administrations in Argentina and Brazil with free-market governments. Elsewhere in the region, Bolivians rejected a proposal to allow leftwing leader Evo Morales to run again, while Venezuela’s embattled socialist leader Nicolás Maduro is facing growing discontent.

Mr Lasso, who forged a career in finance despite not holding a university degree, has cultivated ties with Argentina’s Mauricio Macri and Peru’s Pedro Pablo Kuczynski, who broadly share his ideology. But he insists he is his own man.

“I respect very much presidents Macri and Kuczynski. But I’m Guillermo Lasso.” Asked why he decided to run for office, he said he was “tired of politicians. That’s why I decided to govern.”

His job-creation platform involves lifting investment and trade, cutting taxes and tariffs and a period of “fiscal austerity” to shrink state spending. “Lasso is of the style of Mauricio Macri . . . and would want to make adjustments but not suicidal ones,” said Alberto Acosta-Burneo, an economist in Guayaquil.

State spending doubled under Mr Correa, cutting poverty in the country of 16m. But the end of the oil boom brought a downturn. A corruption scandal at Petroecuador, the state-run oil company, and claims from Brazilian construction group Odebrecht that it paid bribes worth millions of dollars in Ecuador, also damaged Mr Correa.

“Correa has kidnapped all the powers,” said Tirso Angulo, a Guayaquil resident who voted for Mr Lasso. “If Lasso wins we will have more freedoms.”

[I am] tired of politicians. That’s why I decided to govern

If elected, Mr Lasso would seek membership for Ecuador of the Pacific Alliance, a trade bloc of free-market Latin American countries. This would mean leaving the Venezuela-led Alba bloc. Another change would be to reverse Mr Correa’s position and adopt a tough stance against Mr Maduro’s regime, claiming Venezuela has become “a dictatorship of a single party”.

WikiLeaks founder Julian Assange would also be evicted from Ecuador’s embassy in London, where he been since 2012.

Mr Correa’s critics say he has mortgaged Ecuador to China, having borrowed more than $17bn since 2010, according to the China-Latin America Finance Database. Mr Lasso said: “With China we have to broaden the relationship, moving from debt to trade.”

But Mr Lasso, who lost to Mr Correa in 2013, still faces an uphill struggle. Mr Moreno, a paraplegic former vice-president, has the backing of Mr Correa, who remains Ecuador’s most popular politician despite his mercurial style. Analytica Securities, a Ecuador-based research firm, noted how Mr Correa has “overshadowed the presidential campaign even though he’s not on the ticket”.

A piece of graffiti in Guayaquil reads “Lasso corrupt banker” — a reference to his spell as “superfinance minister” in 1999 under former Ecuadorean president Jamil Mahuad. He was toppled after a dire economic crisis that led Ecuador to adopt the US dollar it continues to use.

Mr Lasso’s campaign offices are located in the former quarters of a bank that went bust in that period. Nearby is Banco de Guayaquil, which he led until 2012. “That bank pulled through without help,” he said. “See these hands,” he adds, indicating, “they’re absolutely clean.”

“Because these hands never lost anyone a cent. That’s why I am where I am now.”

Via FT