First Conservative Leader in 2 Decades Takes Over in Ecuador

Guillermo Lasso took office as Ecuador’s president Monday promising to dig the nation out of its deepest economic slump in decades through mass vaccination and by making the country more investor-friendly.

The former banker says he can boost the sluggish recovery by inoculating half the population of 18 million against Covid-19 within 100 days of taking office. To do this, he has reached out to Russia and China to buy shots, and put a pharmaceutical entrepreneur, Carlos Cueva, in charge of the vaccination program.

“We face difficult months ahead that will test our national determination,” Lasso said during his inaugural speech. Lasso’s approval rating climbed to 60.5% as of May 21 after winning the April 11 election with 52.5% of the votes, a survey by pollster Cedatos showed.

First Conservative Leader in 2 Decades Takes Over in Ecuador

Lasso, a 65-year-old self-made multimillionaire and father of five, is the first conservative elected to govern Ecuador in nearly two decades. He takes over an economy that crashed 7.8% last year, and which won’t recover to its pre-pandemic level until 2024 according to an IMF forecast.

With no majority in congress, Lasso faces tough negotiations with opposition lawmakers to pass tax and social security reform to comply with the country’s $6.5 billion credit agreement with the International Monetary Fund. He’s tapped a former IMF official, Simon Cueva, as his finance minister, who will seek softer terms from the Fund.

Read More: Ex-IMF Official to Become Ecuador’s Next Finance Minister

During the inauguration, Lasso and the president of the National Assembly traded compliments, pledging to work together despite the fragmented legislature and ideological opposition to Lasso’s free-market plans among many lawmakers.

As well as upholding the IMF deal, Lasso has pledged to stay current on the country’s recently restructured overseas bonds, which rallied after his election win. The Andean nation has a reputation among bond investors as a serial defaulter.

The nation’s bonds due 2030 have rallied to 87.9 cents from 59.8 cents on the dollar since the April election in which Lasso defeated a socialist candidate feared by investors. Monday, they gained 0.1% to 88.1 cents.

To boost growth, he wants to phase out a tax on sending money out of the country, which he says deters foreign direct investment, and also proposed a cut in VAT during four annual holidays to stimulate retail and tourism.

He also aims to privatize state-owned assets Seguros Sucre, an insurer, and commercial bank Banco del Pacifico, the latter in a sale open to foreign companies only. He’s also promised to crack down on graft.

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