Plan Nacional para el Buen Vivir (inglés)

RESUMEN_BUEN_VIVIR_INGLES_nuevo_RESUMEN BUEN VIVIR INGLES 18/06/10 15:59

René Ramírez GallegosSecretary of National Planning and Development

Miguel Carvajal AguirreCoordinating Minister of Security

Katiuska King MantillaCoordinating Minister of Economic Policy

Doris Soliz CarriónCoordinating Minister of Politics

Nathalie Cely SuárezCoordinating Minister of Production,Employment, and Competitiveness

Jeannette Sánchez ZuritaCoordinating Minister of Social Development

María Fernanda Espinosa GarcésCoordinating Minister of the National Heritage

Jorge Glas EspinelCoordinating Minister of Strategic Sectors

Montgomery Sánchez ReyesRepresentative of the Provincial CouncilConsortium of Ecuador

Paúl Granda LópezRepresentative of the Association ofMunicipalities of Ecuador

Hugo Quiroz VallejoRepresentative of the Rural Parish BoardCouncil of Ecuador

Carlos Díez TorresRepresentative of the Citizen Participationand Social Control Council (observer)

Diego Martínez VinuezaNational Planning Council Secretary

THE REPUBLIC OF ECUADORNATIONAL PLANNING COUNCIL

Rafael Correa DelgadoConstitutional President of the Republic

The Republic of Ecuador. National Development Plan

National Plan for Good Living 2009-2013: Building a Plurinational and Intercultural State

Summarized Version

© Secretaría Nacional de Planificación y Desarrollo – SENPLADES, 2010

Quito, Ecuador (first edition, 3,000 copies)

This material may be used provided it is properly cited.

The National Plan was developed by SENPLADES, in its capacity as Technical Secretary of the National DecentralizedSystem for Participative Planning pursuant to Executive Decree 1577 dated February 26, 2009, and submitted byPresident Rafael Correa for the approval of the National Planning Council. The National Development Plan for thisGovernment term, entitled “National Plan for Good Living 2009-2013” was approved on 5 November 2009, throughResolution No. CNP-001-2009.

This publication includes the names of the present authorities of the institutions represented in the National Planning Council.

TranslationMaricruz González C.

Editorial coordination and revisionMaría Belén Moncayo – Undersecretary for Planning and Public PoliciesAdrián López – Director of Public Policies and Citizen Agreement

Design and layoutMiguel Dávila P. – Soluciones Gráficas

This document is a summarized version of the National Plan. The translator and editorsare responsible for any variation from the original Spanish version.

To see the complete version please visit our link: http://plan.senplades.gov.ec

SENPLADESAv. Juan León Mera No. 130 y Patria. PBX: (593 2) 3978900. Fax: (593 2) 2563332. Quito- Ecuador

Website: www.senplades.gov.ec; e-mail: [email protected]/ [email protected]


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Table of Contents

Presentation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

1. The Construction Process of the 2009-2013 National Plan for Good Living . . . . . . . . . . . . . 101.1. Constitutional Provisions on National Planning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101.2. Guiding Elements to Prepare the Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101.3. Participative Planning for Good Living . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 131.4. Process Achievements and Scopes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

2. Ethical and Programmatic Guidelines . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 152.1. Ethical Guidelines . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 152.2. Programmatic Guidelines. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

3. Change of Paradigm: From Development to Good Living . . . . . . . . . . . . . . . . . . . . . . . . . . . . 173.1. Approaches to the Concept of Good Living. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 183.2. Principles of Good Living . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 183.3. Good Living in the Ecuadorian Constitution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 233.4. Building a Plurinational and Intercultural State. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

4. Critical Diagnosis: Three Decades of Neoliberalism, 31 Monthsof the Citizens’ Revolution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 264.1. Why Did Ecuador Need a Change in the New Millennium? . . . . . . . . . . . . . . . . . . . . . 264.2. 31 Months of the Citizens’ Revolution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48

5. Towards a New Way of Generating andRedistributing Wealth for Good Living. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 545.1. A New Agreement for Coexistence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 545.2. Accumulation and (Re)distribution for Good Living. . . . . . . . . . . . . . . . . . . . . . . . . . . 555.3. A New Long-Term Accumulation and (Re)distribution Strategy . . . . . . . . . . . . . . . . . 56

6. Strategies for the 2009-2013 Period. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 596.1. Democratization of the Means of Production, (Re)distribution of Wealth,

and Diversification of the Types of Property and Organization . . . . . . . . . . . . . . . . . . . 596.2. Transformation of the Economy’s Model of Specialization Through the

Selective Substitution of Imports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 606.3. Increase of Real Productivity and Diversification of Exports,

Exporters, and Markets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 606.4. Ecuador’s Strategic and Sovereign Insertion in the World,

and Latin American Integration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 616.5. Transformation of Higher Education, and Transfer of Knowledge in Science,

Technology and Innovation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 626.6. Connectivity and Telecommunications for the Information

and Knowledge Society . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 636.7. Change of Energy Matrix. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 646.8. Investment for Good Living within Sustainable Macroeconomics . . . . . . . . . . . . . . . . . 656.9. Inclusion, Social Protection and Security, and Guarantee of Rights within

the Framework of the Constitution. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66


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6.10. Sustainability, Conservation, Knowledge of the Natural Heritage,and Promotion of Community Tourism . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67

6.11. Territorial Development and Organization, Deconcentration, and Decentralization . . . . 686.12. Citizen Power and Social Protagonism . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71

7. National Objectives for Good Living . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73Objective 1: To Foster Social and Territorial Equality, Cohesion,

and Integration with Diversity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73Objective 2: To Improve the Citizens’ Capabilities and Potentialities . . . . . . . . . . . . . . . . . . 74Objective 3: To Improve the Quality of Life of the Population . . . . . . . . . . . . . . . . . . . . . . . . 76Objective 4: To Guarantee the Rights of Nature and Promote

a Healthy and Sustainable Environment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77Objective 5: To Guarantee Sovereignty and Peace; to Promote Ecuador’s

Strategic Insertion in the World, and Latin American Integration . . . . . . . . . . 78Objective 6: To Guarantee Stable, Fair and Dignified Work in its Diverse Forms . . . . . . . . . 80Objective 7: To Build and Strengthen Public and Intercultural Spaces

for Social Interactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81Objective 8: To Affirm and Strengthen National Identity, Diverse Identities,

Plurinationalism and Interculturalism . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82Objective 9: To Guarantee Rights and Justice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83Objective 10: To Guarantee Access to Public and Political Participation . . . . . . . . . . . . . . . . 84Objective 11: To Establish a Sustainable Socio-economic System Based on Solidarity . . . . . . 85Objective 12: To Build a Democratic State for Good Living . . . . . . . . . . . . . . . . . . . . . . . . . . . 87

8. National Territorial Strategy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 898.1. A New Territorial Model to Achieve Good Living . . . . . . . . . . . . . . . . . . . . . . . . . . . . 898.2. The Historical Configuration of Ecuadorian Territory . . . . . . . . . . . . . . . . . . . . . . . . . . 908.3. Strengthening a National, Polycentric and

Complementary Structure of Human Settlements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 938.4. Promoting Good Living and Food Sovereignty in Rural Territories . . . . . . . . . . . . . . . 958.5. Increasing the Efficiency of Mobility, Energy,

and Connectivity Infrastructure More Efficient . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 968.6. Guaranteeing the Sustainability of the Natural Heritage Through the Rational

and Responsible Use of Renewable and Non-Renewable Natural Resources . . . . . . . . 978.7. Promoting diversity and Cultural Heritage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1028.8. Fostering Ecuador’s Strategic and Sovereign Insertion in the World

and Latin American Integration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1058.9. Consolidating a Decentralized and Deconcentrated Management Model

with Territorial Planning and Administrative Capacities. . . . . . . . . . . . . . . . . . . . . . . 1068.10. Guidelines for Territorial Planning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107

9. Criteria for Public Investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1109.1. Satisfying Basic Need to General Capabilities and Opportunities . . . . . . . . . . . . . . . . 1109.2. Capital Accumulation in Value-Generating Productive Sectors . . . . . . . . . . . . . . . . . 1109.3. Prioritization Methodology for Public Investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . 111

10. Works cited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 112

11. Acronyms. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 119


When, in January 2007, we started preparing the2007-2010 National Development Plan, the“Plan for the Citizens’ Revolution”, we did notstart from scratch. At this time, our challenge isto consolidate it and this is why the 2009-2013National Plan for Good Living establishes newhorizons aimed to materialize and radicalize theproject for a change of the Citizens’ Revolutionand for the achievement of Good Living for allEcuadorians.

The 2007-2010 National Development Plan, the“Plan for the Citizen’s Revolution”, was elabora -ted for the first presidential term of RafaelCorrea. It was the result of many of the proposalsfor change outlined in the Government Planproposed by Movimiento País, in the run-up to theelections of 2006 and 2007. With the ratificationof a new Constitution (2008), came new elec-tions, a new presidential term for the Citizen’sRevolution (2009-2013). In accordance to thenew political circumstances and the new legaland constitutional framework, a new NationalDevelopment Plan was deemed necessary. It wascalled the 2009-2013 “National Plan for GoodLiving”, and sought to give strength to the FiveRevolutions of the Citizens’ Revolution, pro-mote the gradual construction of a Plurinationaland Intercultural State, and support the newsocial contract contemplated in the new 2008Constitution of the Republic of Ecuador.

The Five Revolutions of the Citizen’s Revolutionare the following:

1. A Constitutional and DemocraticRevolution to lay the foundations ofan inclusive and reflective political

community, by trusting in the country’scapacity to define another historic courseto achieve a fair, diverse, plurinational,intercultural, and sovereign society.

2. An Ethical Revolution to guaranteetransparency, accountability and checksand balances as the pillars on which tobuild social relations that enable mutualacknowledgement between individualsand collective trust; essential for long-term change.

3. An Economic, Productive, and AgrarianRevolution to overcome an inheritedmodel of exclusion, and direct Stateresources towards education, health, theroad network, housing, scientific and tech-nological research, to promote employ-ment and production, in a way whichincludes both rural and urban areas.

4. A Social revolution, hand in hand withinclusive economic policies, for the Stateto guarantee the essential rights of allindividuals, communities, peoples, andnationalities.

5. A Revolution in Defense of LatinAmerican Dignity, Sovereignty andIntegration, to uphold a clear, dignifiedand sovereign position in Ecuador’s rela-tions with international actors and multi-lateral organizations, in order to advancetowards genuine integration within LatinAmerica and the Caribbean; and toinsert Ecuador strategically in the worldcommunity.

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Presentation


The 2009-2013 National Plan for Good Livingraises significant technical and political cha -llenges, as well as methodological and instru-mental innovations. However, the Plan’sgreatest significance lies in the conceptual rup-ture with the so-called Washington Consensus1

and the most orthodox approaches to the con-cept of development.

Good Living is the result of a search, over seve -ral decades, for new ways of living on behalf ofLatin American social actors. It is the result oftheir demands in the face of the neoliberal eco-nomic model and paradigm. In Ecuador, thesedemands were eventually incorporated into theConstitution and have since become the gui -ding principles of the new social contract.

Good Living is based on a vision that surpassesthe narrow confines of quantitative economi-cism and challenges the notion of material,mechanic and endless accumulation of goods.Instead the new paradigm promotes an inclu-sive, sustainable, and democratic economicstrategy; one that incorporates actors historica llyexcluded from the capitalist, market-drivenlogic of accumulation and (re)distribution.

Similarly, Good Living revises and reinterpretsthe relation between nature and humanbeings, and proposes a shift from the currentprevailing anthropocen trism to what we maycall bio-pluralism (Guimaraes in Acosta,2008). Good Living posits that humans shoulduse natural resources in a way that allows theirnatural generation (or regeneration.)

Finally, Good Living also relies on social equa -lity and justice, and gives importance to dia-logue with – and acknowledgement and valueof – diverse peoples, cultures, forms of know -ledge and ways of life.

Good Living, therefore, is a complex, non-linearconcept which is in permanent re–signification.In sum, Good Living could be defined as “covering

needs, achieving a dignified quality of life and death;loving and being loved; the healthy flourishing of allindividuals in peace and harmony with nature; andachieving an indefinite reproduction perpetuation ofhuman cultures. Good Living implies having freetime for contemplation and personal emancipation;enabling the expansion and flourishing of people’sliberties, opportunities, capabilities and potentiali-ties so as to simultaneously allow society, specificterritories, different collective identities, and eachindividual, understood both in universal and rela-tive terms, to achieve their objectives in life (withoutcausing any kind of material or subjective domi-nance over any other individual). Our concept ofGood Living compels us to re-build the public spherein order to recognize, understand and value our-selves as diverse but equal individuals, and in orderto advance reciprocity and mutual recognition,enable self-advancement, and build a shared socialfuture” (Ramírez, 2008: 387.)

This conceptual rupture we are proposing isbased on ethical principles that pave the road toradical change and a fair, free and democraticsociety. In this regard, it relies on five essentialunderstandings of justice: social and economicjustice; democratic and participative justice;inter-generational and inter-personal justice;transnational justice; and unbiased justice. Itsmain proposals could be resumed as follows:

• To build a society that recognizes unitywithin diversity.

• To recognize humans as gregarious beingswho wish to live in society.

• To promote social equality, integration,and cohesion.

• To progressively guarantee universalrights and potentiate human capabilities.

• To build social and economic relations inharmony with nature.

• To build a fraternal and co-operativecoexistence.

• To consolidate liberating forms of work,allowing for leisure.

• To re-build the public sphere.

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1 The Washington Consensus was an ideological way out to the capitalist crisis that resulted from a conference held in1989 by the Institute for International Economics, in Washington.


• To deepen the construction of a represen-tative, participative, and deliberativedemocracy.

• To consolidate a democratic, pluralistand secular State.

The conceptual rupture with the notions of“development” and “State” relies on a long-term strategy that seeks to build an “eco-touristicbiopolis” in the context of a post-petroleum eco-nomic model aimed at generating and redistri -buting wealth for Good Living. For the firstphase of its implementation (2009-2013), thismodel articulates twelve strategies for change:

I. The democratization of the means of pro-duction, the (re)distribution of wealth, andthe diversification of the forms of pro pertyand organization.

II. The transformation of the pattern of eco-nomic specialization through the selec-tive substitution of imports.

III. The increase of real productivity and thediversification of exports, exporters andmarkets.

IV. Ecuador’s strategic and sovereign inser-tion in the world, and Latin Americanintegration.

V. The transformation of higher educationand the transfer of knowledge in science,technology and innovation.

VI. To boost connectivity and telecommuni-cations to build the “information society”.

VII. To change the energy matrix.VIII. The investment for Good Living within

sustainable macroeconomics.IX. The inclusion, social security and protec-

tion, and guarantee of rights within thecontext of the Constitutional Rule of Lawand Justice.

X. The sustainability of the natural heritage,conservation, knowledge and the promo-tion of community tourism.

XI. Territorial development and planning,deconcentration and decentralization.

XII. Citizen power and social leadership.

The Plan therefore proposes a logic based onthe 12 main national objectives previously setforth in the 2007-2010 National DevelopmentPlan, and currently updated in view of theGovernment’s recent performance, new propos-als for sectorial and territorial public policies,and the need to take into account the new con-stitutional framework. The updated objectivesof the National Plan for Good Living are:

Objective 1. To foster social and territorialequality, cohesion, and inte-gration within diversity.

Objective 2. To maximize the citizens’capabilities and potentialities.

Objective 3. To improve the population’squality of life.

Objective 4. To guarantee the rights ofnature and promote a healthyand sustainable environment.

Objective 5. To guarantee sovereigntyand peace; and to promoteEcuador’s strategic insertionin the world, and LatinAmerican integration.

Objective 6. To guarantee stable, fair, anddignified work and employ-ment in its diverse forms.

Objective 7. To build and strengthen pu -blic spaces for interculturalsocial interactions.

Objective 8. To affirm and strengthennational identity, diverseiden tities, plurinationalism,and interculturalism.

Objective 9. To guarantee rights and justice.Objective 10. To guarantee access to public

and political participation.Objective 11. To establish a social, frater-

nal and sustainable economicsystem.

Objective 12. To build a democratic Statefor Good Living.

This Plan offers a cohesive vision of societybased on a rights-and-opportunities approach.Its axes are environmental sustainability; andgender, generational, intercultural and territo -rial equality. A great deal of coordination and

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articulation is required in order to harmonizethe demands of diverse sectors with the natio -nal objectives.

To achieve this articulation, this Plan deve -loped sectorial agendas which were conceivedas instruments of sectorial coordination andconsensus in order to define policies, strategies,programs and projects to be executed by the di -fferent institutions of the Executive Branch.These sectorial agendas and policies are consis-tent with constitutional provisions and withthe objectives of Good Living.

Sectorial consensus, by itself, however, is insu -fficient. The different visions of the inhabitantsof the “territories” must be included in order tostrengthen the integration and improve the li -ving conditions of communities. This is a two-way process in which local planning nurturesnational planning, and vice versa, in order tobuild a new type of polycentric State. In 2007,therefore, Ecuador promoted a NationalDevelopment Plan in which the territorial pers -pective was taken into account through theincorporation of provincial plans. For the 2009-2013 period, this objective was achievedthrough the elaboration a National TerritorialStrategy, which is itself one of this Plan’s maininnovations.

Establishing differentiated agendas for theseven planning zones enabled us to identify thepopulations’ needs in relation to the territories’qualities, potentialities and limitations, as wellas to develop a proposal for a territorial modelarticulated to a national proposal.

This completely new exercise in national pla n -ning also involved high levels of participation.The 2009-2013 Plan was achieved through asustained process of consultation that beganwith the 2007-2010 National DevelopmentPlan. It was constructed by a collective processinvolving a great diversity of actors. In thisregard, it is particularly important to high-light the organization of several CitizenConsultation Workshops, in which more than4,000 representatives of Ecuadorian civil societyparticipated, and both national objectives and

territorial subject matters were discussed. As acontribution to the discussion, opinion pollswere conducted among more than 5,000 indi-viduals, on the meaning of Good Livingamongst other questions.

The 2009-2013 National Plan for Good Livingis divided into nine parts. Part one presents thePlan’s formulation process, which was pro-foundly democratic and intensely participatory.Part two displays the ethical and programmaticguidelines, which underlie and guide the currenttransformation of the country, and part threediscusses the change of paradigm, from develop-ment to Good Living.

Part four offers a critical diagnosis of the country’shistoric economic, social and political processesduring the recent decades, as well as an analysis ofthe Government’s first 31 months. In relation tothe diagnosis, part five puts forward the transfor-mations required to achieve a new mode of accu-mulation and (re)distribution essential for GoodLiving. The next part develops the 12 nationalstrategies for the 2009-2013 period.

Part seven develops the 12 National Objectivesfor Good Living, which have been updatedfollo wing the new constitutional provisions andthe results of the assessment of the 2007-2010National Development Plan, new sectorial andterritorial agendas and policies, and citizens’contributions. This section is concerned withobjectives and policies. A major concern is toput an end to bureaucratic and institutionalinertia which are major obstacles to theNational Government’s compliance with itsown transformation proposal.

As one of the main innovations in the 2009-2013 National Plan for Good Living, part eightincludes the National Territorial Strategy thatidentifies and establishes the territories inwhich the main national strategic interventionsand projects are to be carried out. A first ver-sion of agendas for each planning zone isincluded in a complementary attachment.

In its final part, the Plan develops resource allo-cation criteria though the formulation of a

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Pluriannual Investment Plan. It should benoted that the planning and prioritization ofpublic investment was performed alongside ananalysis of the programs and projects articula tedto medium-term strategies and the policiesdefined for each objective highlighted above.

The 2009-2013 National Plan for Good Livingis a flexible and dynamic instrument, also avai -lable in a digital version. The digital version, inaddition to the contents described above, gathersthe results of participation in the citizen consul-tation tables and includes additional informa-tion in order to allow a process of permanentupdate as policies are developed. This versionalso includes an option for a geographic visua -lization of indicators. This provides public policymakers with instruments that enable them todevelop coverage projections and gauge theimpacts their programs may have in given areas,bearing in mind environmental sustainabilityand gender, generational, intercultural and terri -torial equality.

Finally, the National Plan for Good Living is alsoa first step to build the National DecentralizedSystem for Participative Planning that aims todecentralize and deconcentrate political power

and decision-making and build the Plurinationaland Intercultural State. In this sense, and inaccordance with constitutional provisions, thisPlan leaves the door open for all of Ecuador’s peo-ples and nationalities to build their Life Plans, aswell as to develop the special Plan for Amazonianterritorial constituencies. Similarly, the Planreco mmends the Autonomous DecentralizedGovernments seek to articulate themselves tothis Plan, and update their pla nning instrumentsand territorial intervention priorities.

The “2009-2013 National Plan for Good Living –Building a Plurinational and Intercultural State”was developed with the technical and metho -dological guidance of the Secretariat for NationalPlanning and Development (SENPLADES), incoordination with the technical teams of anumber of different ministries and secretariats,and with the help and contributions of a greatmany Ecuadorian citizens. The Plan’s approvalby the National Planning Council is a milestonein enforcement of the new Constitution and inthe consolidation of participative democracy.

René Ramirez GallegosNATIONAL SECRETARYFOR PLANNING AND DEVELOPMENT

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The creation of the Plan required confrontingfour main challenges: articulating the planningto the new constitutional framework; genera tingprocesses of intra-State articulation and feed-back processes, incorporating a result-orientedform of management; inserting territorial andlocal planning; and promoting a process of socialparticipation.

1.1. Constitutional Provisionson National Planning

The 2008 Constitution considers planning andpublic policies as instruments to achieve theObjectives of Good Living and guarantee ofrights. In accordance with the FundamentalLaw, the aim of planning is to promote socialand terri torial equality and consensus. For thispurpose, the eradication of poverty, the promo-tion of sustainable development, and the equi-table (re)distribution of resources and wealthare essential. In this new approach, the citizens,both individually and collectively, are entitledto partici pate and be protagonists in publicdecision- and policy-making.

Pursuant to the constitutional provi-sions set forth in Art. 280, the NationalDevelopment Plan is the instrumentwhich governs public programs, policiesand projects, the programming andimplementation of the State budget,public investment and allocation, andcoordinates exclusive competencesbetween the Central Government andthe Autonomous Decentralized Govern -ments. Its observance is mandatory forthe public sector and exemplary for othersectors.

1.2. Guiding Elementsto Prepare the Plan

The 2008 Constitution, the new social contractapproved in referendum, is the main point ofreference for the national planning process.The Plan was updated according to theConstitution and received a different name toreflect the change of paradigm encompassed inthe term “Good Living”. It was called the “2009- 2013 National Plan for Good Living: Buildinga Plurinational and Intercultural State.”

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1. The Construction Process of the2009-2013 National Plan for Good Living


This Plan was also based on Rafael Correa’spolitical project, ratified by the Ecuadorian peo-ple in the ballot box and has the political legiti-macy of a social and civil mandate to which theGovernment must respond and render accounts.

This Plan is also based on an analysis of thecountry’s situation; on an examination of com-pliance with the goals of the 2007- 2010 Plan;and on the evaluation of public policies, pro-grams and projects to determine their impact,efficiency and results.

During the 2007-2009 presidential term, theState and the public administration – traditio -nally structured around the logic of sectorialplanning and implementation – carried out anambitious effort of articulation and synergy. Asa result, the focus of planning changed to anaims and results-oriented management, in

which policies and programs become appropri-ated, coordinated, and shared by the differentpublic institutions involved in the implementa-tion and evaluation of policies.

The challenge of shifting from sectorial planningreasoning to an objective- and aims-orientedform of planning required a structured vision ofpublic policy understood as a whole. To pro-mote this structured articulation, the develop-ment of this Plan was based on designingsectorial agendas – one for each sectorial area inthe Executive Branch– which could be instru-mental for the purpose of sectorial coordina-tion. Sectorial agendas are compatible with theConstitution, with the objectives of GoodLiving, and with good operative planning. Theyallow the articulation between medium-termprogrammatic orientations and effective insti-tutional management (Figure 1.1.)

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Figure 1.1: The articulation of the strategies with the institutional management

Prepared by: SENPLADES.


It is essential to follow up on whether the over-all aims are being upheld. For this purpose, indi-cators are essential in order to follow up on andevaluate whether public actions and policies arehaving the expected or desired impact in 2013.The indicator baseline corresponds to 2008 orthe most recent year with available informa-tion2. Indicators are validated by both the min-istries in charge of implementation andcoordination.

Given that the Plan is articulated to institu-tional planning, public entities carry out theirown institutional plans in line with theNational Objectives; this means the Plan’s goaland indicators are complemented by each enti-ty’s own specific indicators.

Each state body and autonomous decentralizedgovernment must comply with the goals setforth in the Plan. This also requires a commit-ment on behalf of civil society.

Additionally, implicit, practical or subjectiveknowledge, not necessarily subject to codifica-tion, requires multiple feedback mechanismsand citizen participation; knowledge has asocial nature and is inseparable from collectiveaction. For this reason, the Plan also includesdialogue mechanisms in order to identify theimpact of public programs and to follow up onpublic investment.

This Plan’s development included a pioneeringprocess for public investment planning, prioriti-zation, and programming for the 4-year period.The identification of investment requirementswas performed together with program and pro -ject analysis, validation, and prioritizationbased on the agendas and policies of eachSectorial Council. A technical process was ini-tiated to enable project resource allocation.This process considered specific criteria, suchas: the policies defined in this Plan, medium-term strategies, the political program approved

in the last elections, the Investment PriorityIndex, and the prioritization exercise of thecoordinating ministries. The public investmentscenarios measured the impact on the nationaltreasury and took into account fiscal sustain-ability. The result is the Pluriannual InvestmentPlan that shall be revised and updated regularly.

Sectorial compromise and agreement, however,is by itself insufficient. The territory and itscharacteristics must be considered and analyzedas part of a two-way process in which local pla -nning feeds and nurtures national planning,and vice versa, for the purpose building a poly-centric State. In 2007, Ecuador elaborated itsNational Development Plan on the basis of aterritorial perspective based that relied on theprovincial level. For the 2009-2013 period, oneof the Plan’s main innovations is the NationalTerritorial Strategy which identifies the maininterventions and strategic projects in the terri-tories. The development of zonal agendas helpsidentify the people’s needs and the qualities,potentialities and limitations of the territories.These zonal agendas also offer a territorialmodel containing guidelines for the use of land,and strategic regional policies articulated to anational proposal.

The National Territorial Strategy must be con-solidated and enriched through participativeplanning and the feedback from the Auto -nomous Decentralized Governments. Coordi -nation mechanisms must also be streng thened inthe territories to consolidate a balanced andinclusive territorial model.

This Plan is not the sum of the local or secto rialplans of the Ecuadorian State, even if territo rialdemands and expectations have been analyzedand have greatly contributed to its develop-ment. The Life Plans of the Ecuadorian peoplesand nationalities, as well as the special Plan forthe Amazonian territorial constituencies werealso incorporated to this effort.

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2 The goals are complemented with support indicators for the Plan’s follow up and assessment.


1.3. Participative Planningfor Good Living

Citizen participation is a right. Participativeplanning is therefore inspired by a profoundlyethical understanding of democracy: to uniteindividual interests and rely on the knowledgeand abilities of the Plan’s target beneficiarieswho are co-responsible in the framing of publicactions and policies that are addressed to thesociety as a whole.

The Plan’s participative nature was achievedthrough a sustained consultation process thatbegan with the preparation of the 2007-2010National Development Plan. It was characte -rized by the diversity of the actors who took partin the process, and was elaborated with the helpof citizens’ policy implementation inspector-ships, national and regional citizen consulta-tion, and dialogue and consensus-building withsocial and institutional actors.

Citizen InspectorshipsBetween June 2008 and March 2009, citizenspaces were created to enable the participation ofwomen and men from different social-culturalbackground, age, sexual choice, condition, togive their opinion on the achievements of the2007-2010 National Development Plan; to su -ggest amendments and scrutinize the entirecycle of public policies derived from the Plan,and to give their opinion on programs and pro -jects implemented in the seven different pla -nning zones. The results and observations fromthe inspectorships have been incorporated to thisnew 2009-2013 National Plan for Good Living.

Public policies, therefore, can be nurtured bythe knowledge of the citizens and social groups.This process promotes citizen empowerment forco-habitation in diversity, and strengthens thesocial system.

Citizen Consultation WorkshopsThese workshops were organized to strengthenthe Plan’s articulation in the territories and

communities. They were held in regional mee -tings in Esmeraldas, Babahoyo, Portoviejo,Santo Domingo, Cuenca, Loja, Latacunga andTena. Two other workshops were held in Quitoand Guayaquil. Given their territorial, environ-mental and cultural differences, a separate work-shop was held in the Galapagos Islands, andanother was held in Baños with the representa-tives of the peoples and nationalities of Ecuador.In this regard, it is particularly important tohighlight the fact that more than 4,000 repre-sentatives of Ecuadorian civil society participa -ted in these workshops, and both nationalobjectives and territorial subject matters werediscussed.

The aims of the workshops were to identifynational policy proposals based on the know ledgeof local actors and their regional reality, in orderto overcome the micro community-canton-province and examining the country’s problemsas a whole. To this end, a methodology wasdesigned to reflect on national objectives fromthe perspective of the diverse regional realities.The results of such participative processes wereprocessed through each workshop’s systematiza-tion cards published in the website that was cre-ated for this purpose.

Additionally, large-scale social and politicalevents were organized in various public plazasto communicate the contents of the Plan; par-ticularly in Quito, Guayaquil, Cuenca andLoja. As a further contribution to the discu -ssion on the Ecuador’s societal priorities, opi -nion polls were conducted among over than5,000 citizens.

Dialogue and Consensus BetweenSocial and Institutional ActorsA consultation process was also performedthrough the National Councils for Equality,which initiated an ongoing dialogue with theorganizations, social movements, and peoplesand nationalities in order to define the policiesrequired for the inclusive development of thesectors historically discriminated against.

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Methodological Principles of theCitizen Consultation Workshops

A dialogue between diverse forms ofknowledge between technical, acade -mic, and popular actors and enablingeveryone to be listened to and incorpo-rated into the process.

Valuing the experience: The partici-pants’ know-how and experiences werethe starting point of the dialogue tokeep their voice from being subdued bythe opinion of the experts.

Diversity as wealth: The participants’diversity, criteria and proposals were allencouraged. Diversity was not deemedan obstacle, but rather promoted.

Deliberation over consensus: Discu -ssions were promoted as part of a citizen-ship-building exercise. Disa greementsand consensus were noted and recorded,and no agreement was imposed.

From fragmented to complex thinking:We sought to overcome the logic of sec-torial planning and promote planningbased on National Objectives and terri-torial subject matters.

Transversal axes: All reflections tookinto account gender, generational, terri-to rial, and intercultural considerations.

Flexibility: The methodology was adapt-ed to the different contexts and partici-pants of the consultation workshops.

1.4. Process Achievementsand Scopes

The following was emphasized:

• The consolidations of planning based onNational Objectives integrated into thesectorial policies. However, this logic stillneeded to be strengthened through insti-tutional planning in order to fill the gapsand prevent overlapping.

• The involvement of public institutions incharge of policies and, in particular, thecoordinating ministries and instancesresponsible for transversal axes (gender,intercultural, generational and territorialapproaches).

• The communication of the plan’s objec-tives were communicated to broad sectorsof society. The participants also madesubstantial contributions to improve thePlan.

• The successful articulation of levels ofdeliberation, debate, and discussion aswell as a good representation from diffe -rent sectors.

• The establishment of the bases for a par-ticipative planning system that con-tributes to radicalizing democracy in thefuture.

The following main challenges were identified:

• A participation system that allows per-manent and efficient integration of thesociety’s aspirations in the different pla -nning processes must be promoted.

• Further debate must be encouraged inthe territories for the Plan’s applicationfor the effective establishment of theNational Decentralized System forParticipative Planning.

• Better articulation and synergy arerequired between the different levels ofgovernment in order to opti mize actionsthroughout the territories.

• The planning process must be consolidat-ed by a better articulation between plan-ning and resource allocation according tonational priorities.

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Any responsible political project must containa set of ethical, utopian and theoretical princi-ples to pave the road and ensure the viabilityof the collective and individual dreams andaspirations.

This Plan’s principles and guidelines seek tocontest the idea that the present is a mere his-toric fatality to which we must surrender.Denying the possibility of change compels co -mmon citizens to adopt conformist outlooks onthe future and prevents people from believingthat other forms of social life are possible. It isfor this reason that we must defend the legiti-macy of the politics of emancipation, as well asreclaim the right to envision a better future.

2.1. Ethical Guidelines

• Social and economic justice for the exerciseof freedom for all: In a fair society, each ofits members enjoys the same access to thematerial, social, and cultural meansrequired to survive and lead a satisfactorylife that allows each individual to reachself-fulfillment and sets the bases for theirmutual recognition as equals (Wright,E.O., 2006:3.)

• Democratic participative justice: In a politi-cally fair society, all members must havethe same power to contribute to the co -llective institutionalized control of thepolitical conditions and decisions that

affect their common destiny. This mustbe construed as the defense of the princi-ples of political equality, participation,and democratic collective power(Wright, E.O., 2006.)

• Inter-generational and interpersonal justice:In a fair society, actions and plans in thepresent must take into account futuregenerations. This involves an environ-mental and distributive promise thattakes in consideration the environmentaland social impacts of the use of naturalresources; gender equality; and theacknowledgement of the country’s cultu -ral diversity.

• Transnational justice: A fair global societyimplies overcoming the fact that eachindividual’s life options are limited byboth social and national accidents ofbirth. If we acknowledge the existence ofglobal public goods and the mobility ofhuman beings and resources betweencountries, then the (re)distribution of tan-gible and intangible goods and the leve -ling the weight of participation in theglobal political sphere should be treatedseriously. (Nussbaum, 2006, ob. cit.)

• Impartial justice: A fair society must pro-vide each and every citizen with juridicalsecurity and an equal treatment in allprocedures. In such societies, individualrights are respected as they are part of asocial objective (Dworkin, in Campbell,2002; Rawls, 1999.)

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2. Ethical and Programmatic Guidelines


2.2. Programmatic Guidelines

This Plan aims to disrupt the historic courseof Ecuadorian development and democracyby espousing the Five Revolutions of theGovernment of Citizens’ Revolution:

1. A constitutional and democratic revolutionto lay the foundations of an inclusive andreflective political community, by trustingin the country’s capacity to define ano -ther course for a fair, diverse, plurinatio -nal, intercultural and sovereign society.This demands consolidating the currentconstitutional process through regula-tions, the implementation of public poli-cies, and the State’s transformation inline with the rights encompassed in GoodLiving are truly exercised. To this end, itis essential to form radical citizens that setthe material bases for a national projectinspired by equality in diversity.

2. An ethical revolution to guarantee trans-parency, accountability and checks andbalances as the pillars on which to buildsocial relations that enable mutualacknowledgement between individualsand collective trust; essential for long-term change.

3. Economic, productive, and agrarian revolu-tion to overcome an inherited model of

exclusion, and direct State resourcestowards education, health, the road net-work, housing, scientific and technologi-cal research, to promote employment andproduction in a way which includes bothrural and urban areas. This revolutionmust be achieved by democratizing accessto water, land, credit, technologies,knowledge, and information, and bydiversifying the forms of production andproperty.

4. A social revolution, hand in hand withinclusive economic policies, for the Stateto guarantee the essential rights of allindividuals. This revolution must offeropportunities for socio-economic inser-tion and, at the same time, strengthenthe capabilities of individuals, communi-ties, peoples, nationalities and groups inneed of services that enable them tofreely exercise their rights.

5. A Revolution in Defense of Latin AmericanDignity, Sovereignty and Integration, touphold a clear, dignified and sovereignposition in Ecuador’s relations withinternational actors and multilateralorganizations, in order to advancetowards genuine integration within LatinAmerica and the Caribbean; and toinsert Ecuador strategically the countryin the world community.

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The prevalent concept of “development” isundergoing a profound crisis. In part this is onlydue to the colonial perspective from which theconcept is derived. But it is also a result of itsfailure throughout the world. The present glo -bal crisis has demonstrated that it is impossibleto maintain the current patterns of accumula-tion. For the South, it has meant an extractivistand devastating path to development, withunequal relations of power and trade with theNorth. Moreover the unlimited consumptionpatterns derived from this model are leading theentire planet to collapse, given that the bios-phere is unable to ensure its capacity for rege -neration. It is essential, therefore, to promotenew modes of production, consumption, andorganization of life and coexistence.

The hegemonic ideas of progress and develop-ment have generated a monoculture that invi -sibilizes the historic experience of the diversepeoples that compose our societies. A linearvision of time supports the concept of progress,modernization and development in which his-tory has only one purpose and one direction:developed countries are ahead and are the“model” all societies should follow. Whateverfalls outside these ideas is considered savage,primitive, obsolete, pre- modern (Sousa Santos,2006: 24.)

Development as modernization and economicgrowth tends to be measured through the varia-tions of the Gross Domestic Product (GDP.)Industrial development is what society should

expect development and the culmination of themodernization process. Underdevelopment isattributed to the backwardness of society;which ignores the importance of external fac -tors and the nature of the capitalist accumula-tion process.

In contrast, the concept of “human develop-ment” defends the idea of development basedon human beings, and not merely on markets orproduction. What must be measured, therefore,is not GDP but the living standards of peoplethrough indicators related to the satisfaction oftheir human needs.

The concept of human development empha-sizes quality of life, human opportunities andcapabilities that must be encouraged in order tocover different types of needs, such as liveli-hood, affect, participation, freedom, identity,creativity, etc. Quality of life is understood asliving a long and healthy life, the capacity toacquire knowledge, and having access to theresources required for a decent level of life(UNDP, 1997: 20). The emphasis is on whatpeople can “do and be”, based on their poten-tialities, ways of thinking, needs, cultural valuesand patterns of organization.

In addition to covering needs and expandingcurrent human capabilities, it is clear thathuman development must be sustainable. Thisis not viable without respecting historic andcultural diversity, the very basis on which thenecessary unity of the people is constructed. For

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3. Change of Paradigm:From Development to Good Living


this purpose, it is vital to grant equal rights andopportunities to women and men, to peoplesand nationalities, to boys, girls, youngsters, andadults. This also implies unrestricted citizenparticipation in the exercise of democracy.

In general terms, however, the prevailing con-cept of development has remained immune toquestioning. It has “resisted” feminist, environ-mental and cultural attacks and criticisms. Itsdetractors have been unable to institutionalizetheir alternative proposals. This is the reasonwhy, today, more than ever, the South needs toput forward proposals which to re-think social,cultural, economic and environmental rela-tions. By following the new social contract setforth in the 2008 Constitution, this Plan pro-poses a moratorium of the word “development”and the incor poration of the concept of GoodLiving in the debate.

3.1. Approaches to theConcept of Good Living

The Andean indigenous peoples have con-tributed to this debate by applying other episte-mologies and cosmovisions. One of theirgreatest contributions is the notion of sumakkawsay, ‘life to the fullest’. The notion of deve-lopment is inexistent in these peoples’ cosmovi-sion since the future is behind us because theconcept implies something we do not look at orknow. In the Andean cosmovision, the past isin front of us; we see it, we know it, it is ours,and we walk with it. Our ancestors are with uson the road; they join us, the community andnature to become one. We “are” together withall these living creatures that are part of ourlives. The upside world, the downside world,and this world are connected to each other andare part of a whole within a spiral, and not alinear perspective of time.

Ancestral thought is essentially collective. Theconcept of Good Living necessa rily resorts tothe idea of “us”. The community shelters, pro-tects, demands; it is the basis for the reproduc-tion of that collective subject that each andevery one of us is. This is why humans are con-ceived as one part of a whole that cannot beunderstood only as a sum of its parts. The whole

is present in each being and each being in thewhole. “The universe is permanent; it hasalways existed and will always be here; it is bornand dies in itself and only time can change it”(Kichwa saying). This is why to harm nature isto harm ourselves. Sumak kawsay, or life to thefullest, transmits this cosmovision. Living life tothe fullest consists in achieving total harmonywith the community and the cosmos.

The concept of Good Living converges withother concepts that are also present inOccidental thought. In his ethical and politicaltheories, Aristotle also talked about GoodLiving. For him, the ultimate goal of humanbeings was happiness, which can be achieved inthe context of a happy polis. In other words,happiness for all, which is each individual’shappiness, can only be achieved in the politicalcommunity. Goof Living, therefore, relates ha -ppiness to friendship, love, political undertaking,the possibility of contem plation, of theorizing,and creating works of art. All of these elementshave been forgotten in the prevailing notions ofdevelopment.

The word “development”, furthermore, hasbecome a synonym of “well-being”. We believe,however, that the translations of the term “well-being” in Spanish, namely “bienestar” needs tobe revised and raises problems we cannot elude.The verb “to be” in Spanish has two meanings:“ser”, which is a more permanent and existen-tial condition, and “estar”, a more transient,temporary condition. The expression “bienestar”omits the former holistic understanding of“being” (Ramírez: 2008, 387).

3.2. Principles for Good Living

Good Living’s combination of ethical and pro-grammatic guidelines for Good Living seeks toarticulate democratic liberties with the possibi -lity of building a fair and shared future. A freesociety is evidently not possible fighting eco-nomic and political inequality. Its developmentalso depends on the sustainable management ofnatural resources.

As suggested by Wright, E.O. (2006), the aim isto promote the construction of a society that

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expands democracy and its incidence on radicalsocial and material equality – and not focusexclusively on the market, as in the case ofneoliberalism, or of the State, as in the case of so-called ‘real socialis m’ – as the guiding force ofsocial development. The idea is to promote free-

dom, the citizens’ autonomous mobility, andtheir capacity to cooperate voluntarily in indi-vidual or collective actions. This capacity isbased on the premise that citizens having realcontrol over the use, assignment and distribu-tion of a country’s tangible and intangible goods.

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Figure 3.1: A Strong Civil Society

Source: Wright, E.O., 2006.


Human diversity3 makes it almost impossible toreach complete equality. Inequality, however,must be drastically reduced, and for this purposewe need to establish means with which toachieve a this reduction in inequality and to cre-ate scenarios that promote emancipation andself-fulfillment under principles of solidarity andfraternity that enable common recognition.

3.2.1. Unity in DiversityIn societies marked by a history of colonialdomination, living in a community, which is anessential part of Good Living, depends on theexisting opportunities to build such a commu -nity in the first place. We need to recognize

diversity as a substantial part of society by meansof intercultural learning that will enable thethriving of multiple cos movisions, forms ofknowledge, epistemologies and cultural practices.

The 2008 Constitution incorporates a crucialbreak with the past: the shift from a multi-cultural and multi-ethnic State, encompassedin the 1998 Constitution, to a plurinational andintercultural State. In societies like theEcuadorian society, marked by inequalities, wecannot think of interculturalism without con-sidering domination processes. Interculturaldialogue is based on the premise of a dialogueamong equals; and this is not possible whensome cultures are subordinated to others.

3 Human diversity is the result of external characteristics, such as the social and natural environment humans are immer-sed in their legitimate heritage, as well as personal characteristics like age, sexual orientation, gender, ethnic group,metabolism, etc.


Similarly, economic inequality is linked to deepongoing processes of social exclusion, discri -mination and segregation.

As a result and in order to build a plural, demo-cratic society, there must be a focus on threelevels: the social-economic level to assureequality; the political level to enable changes tothe structure of power so that difference nolonger favors oppression; and the social-culturallevel, in which differences may be acknow -ledged, and which opens the possibility of inter-cultural learning (Díaz Polanco, 2005.)

A plurinational State means building a radicallydemocratic post-colonial State. Pluri natio -nalism acknowledges the authority of peoplesand nationalities elected according to their usesand customs within the context of a unitaryState. Plurinationalism, therefore, values thedifferent forms of democracy that exist in thecountry: community, deliberative, and partici-pative forms of democracy that nurture andcomplement representative democracy.

The construction of a radically democraticState is also the construction of a polycentricState. Plurinationalism goes hand in hand withdecentralization which is not synonymous withthe weakening of the State. A strong decentra -lized State and a sound diverse society are bothpossible and necessary.

3.2.2. Human Beings Who Seekto Live in Society4

Human beings are social, gregarious and poli -tical beings. Personal fulfillment is unthinkablewithout acknowledging and interacting withothers. It is about acknowledging that we areunable to defend our own life without defending

the life of others – those who exist now andthose yet to come – and that, together, we mustensure that each person and community caneffectively choose to live the life they seek andexercise their rights.

Freedom must therefore be understood as thefulfillment of each person’s potentialities.Freedom for all is conditioned to the freedom ofeach individual.

People are interdependent and not isolatedbeings. As interdependent beings we need anddepend on other individuals in order to beautonomous, achieve “wellbeing” and socialreproduction. People acquire their intellectualand emotional abilities in the family, in institu-tions, in social milieus, and need a series of pro-tections related to material, emotional andintellectual wellbeing throughout their lives,and in particular during childhood and old age.

With this in mind, Good Living comprises pro-ductive processes which are compatible withthe repro ductive processes5. A developmentmodel based on Good Living must pursue a fai -rer social caring regime, in which caring activi-ties are better valued, distributed, and expresslydirected at eradicating the sexual division oflabor, for a more equitable provision and recep-tion of care (Herrera, 2009.)

3.2.3. Equality, Integrationand Social Cohesion

An egalitarian society is a non-stratified politi-cal community in the sense that it does not cre-ate unequal social groups. Many models basedon State assistance are limited to providingaccess to survival goods and have failed to takeinto consideration the various distances and

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4 For a more exhaustive development of the issues raised in this section, see Ramírez & Minteguiaga (2007.)5 Different studies, using different methodologies, estimate that the reproductive and care-related labor performed by pri-

marily female Ecuadorian individuals represents between 25% and 50% of Ecuadorian GDP (León, 1998.) The currentcare regimes are vectors of social injustice, inequality and exclusion. It is not merely that household workers earn muchless than other workers, but also the fact that people are not well taken care of; and that, after taking care of someoneelse all their lives, women do not receive any compensation or care themselves. In addition, many women are not in aposition to choose whether they give care services or not, as men often do, and thus lack free time.


limitations that separate individuals from oneanother. As a result, these models have repro-duced an unequal, poorly-cohered society inwhich there is a high probability of building andconsolidating patterns of subordination. Thesearch for a common place where male andfemale citizens mutually recognize themselvesas equals is postponed. We must clarify, however,that equality “does not mean that everybodymust have the same income [life conditions,lifestyle, tastes, wishes, expectations, etc.], butit demands an approximate equality that isinconsistent with the systemic generation ofrelations of domination and subordination”(Fraser, 1999.)

3.2.4. Complying with UniversalRights and PromotingHuman Capabilities

In Good Living, access to minimum or basicgoods is insufficient. The true goal is to developcapabilities and express individual identities.The reference must be a dignified life and notmerely survival.

Economics Nobel Prize Amartya Sen suggestedthat “given the fact that the conversion of pri-mary goods or resources into liberties ofchoice may vary from one person to another,equality in the possession of primary goods orresources can also bring a series of inequalitiesin the real liberties enjoyed by different indi-viduals” (1992).

The objective, therefore, must be to guaranteethe rights of citizens, and along with this, theirco-responsibility in complying with their dutiestowards others, their communities, and societyas a whole. If rights are the objective, policiesmust be universal and not selective. Focalizationmay reflect priority in case of temporary emer-gencies, but the guiding principle of mid- andlong-term economic and social strategies mustbe universal solidarity.

3.2.5. Harmonious Relationswith Nature

Ethical responsibility with current and future

generations and with the rest of species is acri tical foundation to prefigure human develop-ment. It acknowledges the human economy’sdependence on nature; it admits that economyis part of a broader structure – the ecosystem –which supports life as a resource-supplier andwaste-drain (Falconí, 2005).

It is not about keeping our natural heritageuntouched or frozen in time, which would be animpossible task. It is about protecting it at theadequate levels.

3.2.6. Fraternal, Cooperative andSolidarity-based Coexistence

One of the essential orientations of humancoexistence is to build relations that foster soli-darity and cooperation among citizens who re -cognize themselves as part of a social andpolitical community. This objective is consis-tent with a society that seeks to recover theindividual’s public and social nature and doesnot merely pretend to promote the develop-ment of a lonely and egotistic human being, asso-called free-market societies do.

Fraternity implies civic motivation: acknow -ledging the needs and interests of the other;accepting the justice of law and respecting insti-tutions that enable the exercise of a democraticsocial order, in which each and every individualhas an equal opportunity to become an activecitizen.

3.2.7. Liberating Work and Free TimeThe first and most basic form of freedom gene -rated by work is the possibility to assure one’sown autonomous maintenance.

Work distribution is often confused with employ-ment distribution. In the capitalist societies,work is essentially divided into: wage labor,autonomous mercantile work, non-mercantilehousehold work, and community work. In thissense, an egalitarian agenda consists in distri -buting the entire work load and not only thepart performed under wage labor conditions(Riechmann y Recio, 1997.)

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The following notion is emblematic of what issought: “let’s work less so we all work; let’s con-sume less so we all consume, with environmen-tally sustainable criteria to improve the qualityof life by taking care of others, of the surroun -dings, and of ourselves; let us not only questionincome distribution but the form of productionand the products consumed” (Riechmann yRecio, 1997: 34.) Moreover, reducing the work-day should not only be considered as a techni-cal instrument to achieve a fairer distribution ofwork, but as a transformative goal of society, togenerate more free time for individuals.

The mode of production must be focused onwork, and not based exclusively on the State’sproperty of the means of production, as realsocialism proposed, but on a mixed propertyregime where regulated private property, publicproperty, community property, and collectiveassociative (co-operative) forms of propertycoexist. This means transiting from an economyof greed to an economy of altruistic solidarity.Being socially efficient means to competethrough sharing, and to generate privatewealth, but within a system marked by solida -rity, reciprocity and social justice (De SousaSantos, 2007.)

3.2.8. Re-Building the Public Sphere6

One of the main problems of the past decadeswas the privatization of public goods. The cons-truction of a new society evidently demandsrecovering them. This implies reinstating theidea of public property and services as goodsthat are collectively and universally producedand appropriated. There is a group of goods towhich access cannot be conditioned in any way;and which cannot be converted into merchan-dise to which only an exclusive groups hasaccess. The State must guarantee unrestrictedaccess to these public goods.

Public matters must return to the fore; some-thing which people have to come to understandas the opposite of secrecy and concealment. In

the case of the State, transparency is essential.Otherwise, it may create inequalities in theallocation of resources. Making public mattersvisible deters relations of domination, whichtend to be legitimized by their private nature, inthe same way that violence against women andgender violence in general is often the result ofsecrecy and silence.

The “public” sphere is also related to the spacesdedicated to the interaction between citizens –spaces open to all people, with no exclusions,which do not reproduce the market space ofbuyers and purchasers.

3.2.9. Representative, Participativeand Deliberative Democracy

A democratic State also requires political insti-tutions and public governance which, followingplural and diverse structures of representation,allow citizen participation and public delibera-tion in decision-making processes. Only whendue spaces for participation and dialogue areopen to citizens, will their public incidence,self-government, autonomous capacity toorganize, and interest in public matters grow.

Participative governance entails the presen ceof active citizens, strong social movements,commu nity associations, citizen alliances, andcivil organizations, all working in networkswith State agents to deal with local and natio -nal matters and challenges. The institutionali -zation of multiple participation devices isparamount for citizens to gradually influenceand control political decisions. At the sametime, participation triggers the interest andprotagonism of the least favored sectors, which,in turn, bears a positive impact on a fairer(re)distribution of social wealth.

3.2.10.A Democratic,Plural and Secular State

A plurinational mega-diverse State defendsthe multiple identities which, in continuous

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6 For a detailed analysis on the public sphere see Rabotnikof, 2005.


interaction, reproduce a series of complex rela-tions with the nation. The idea of a citizen asthe holder of rights is united to the idea of acollec tive ownership of rights – language, cul-ture, justi ce, and territory.

Similarly, the notion of a State that acknow -ledges differences must anticipate specific legaland institutional solutions that enable theeffective equality of diverse individuals. In thisway, a space is open for specific policies of affir-mative action in order to mend the historicadvantages enjoyed by certain groups and toanticipate a context of equal opportunities forall Ecuadorians.

In a radical democratic society, cultural andartistic activities must be conceived as symbo licactivities that allow the free flow of the expre -ssion and capacity for critical reflection of indi-viduals. An essential part of the value of theseactivities is their capacity to embody the social,cultural and historic specificity around whichsocial life evolves. Cultural activities, therefore,must be guaranteed by the State as public goods.Due to their essentially free nature, their auto -nomy must be protected from the State’s admi -nistrative demands and the market’s speculations.

The defense of the State’s secular nature, unders -tood as the establishment of the suitable legal,political and social conditions for the full develop-ment of freedom of thought, is vital for the pur-pose of guaranteeing social pluralism. Secularismkeeps the State and its policies from privileging aspecific belief, opinion or view of the world.

Each individual citizen is, thus, considered thesole holder of freedom of thought. This in turnmarks the difference between the public sphere– which concerns all the citizens regardless oftheir intellectual orientations – and the privatesphere, and reaffirms the necessary separationbetween all churches and the State. Publicpowers must protect freedom of religion andcult, and the freedom of thought with no dis-crimination whatsoever.

In the exercise of sexual and reproductiverights, the State’s secular nature guarantees therespect for autonomous options and promotesthe rejection of dogmas. This enables people tolive in a context of diversity without intole -rance. It also means the State ultimately defendsthe use of reason, of knowledge and science,always verifiable and subject to perfection, andnot non-demonstrable beliefs. People are enti-tled, therefore, to make their own sexual andreproductive choices, and benefit from scientificadvances, based on their access to informationand unprejudiced free education.

3.3. Good Living in theEcuadorian Constitution7

The Constitution sets aside the restrictedvisions of development exclusively based oneconomic growth and places human beings asthe ultimate objective, achieving sumak kawsayor Good Living in the process. The Constitutionalso rejects the false dichotomy between Stateand market promoted by neoliberal thought,and establishes a complex interrelation betweenthe State, the market, society and nature. Themarket will no longer be the sole engine thatpromotes development. Instead it will interactwith the State, society and nature.

Good Living is vows for change; a sort ofchange that is built on a continuous basis inresponse to the claims made by Latin Americansocial actors over the last decades to strengthena broader vision that surpasses the narrow con-fines of quantitative economicism and cha -llenges the notion of material, mechanic andendless accumulation of goods. Instead the newparadigm promotes an inclusive, sustainable,and democratic economic strategy; one thatincorporates actors historically excluded fromthe capitalist, market-driven logic of accumula-tion and (re)distribution.

Similarly, Good Living revises and reinterpretsthe relation between nature and human beings,

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7 This section collects abstracts from Larrea, A. M. 2009.


and proposes a shift from the current prevail-ing anthropocen trism to what we may call bio-pluralism (Guimaraes in Acosta, 2008). GoodLiving posits that humans should use naturalresources in a way that allows their naturalgene ration (or regeneration.)

Art. 275 of the Constitution emphasizes theenforcement of rights as a precondition forGood Living; and the exercise of responsibili-ties related to interculturalism and harmoniouscoexistence with nature. It acknowledges therights of nature and, in this way, changes theprevailing vision of nature, understood asresources, to another completely differentvision whereby nature is “the space where life isreproduced”.

The Fundamental Law strengthens the State byrecovering its planning, regulating and redistri -buting role, and as a guarantor of public ma tters.It is not a simplistic statist vision in which therole of the market is merely replaced by the roleof the State. On the contrary, by strengtheningand expanding rights and recognizing participa-tion as an essential ele ment in the constructionof the new society, the Constitution seeks tostrengthen society and not merely the State.

For the new Constitution, sumak kawsay alsoimplies improving the people’s quality of life;developing their capabilities and potentialities;relying on an economic system that promotesequality through social and territorial (re)distri-bution of the benefits of development; guaran-teeing national sovereignty; promoting LatinAmerican integration; and protecting and pro-moting cultural diversity (Art. 276).

The significance bestowed to diversity in theFundamental Law is not limited to the culturalsphere; it also includes the economic system.The Constitution acknowledges that the eco-nomic system is a social and fraternal system. Itdoes this by incorporating the perspective ofdiversity of actors and patterns of property inthe economic system, and by surpassing themarket-focused vision prevalent in the previousconstitutional order, which defined Ecuador’seconomic system as a “social market-economy”.In the Constitution, the economy must serve the

reproduction of expanded life. This meansreverting capitalism’s perverse logic which seescapital accumulation as the engine of life.Instead of stressing capital, the new Constitutionemphasizes work as a core notion. From this pers -pective the key is to support the people’s eco-nomic initiatives from the perspective of work,and for the wealth to remain directly in thehands of the workers (Coraggio, 2004.)

3.3.1. Rights as the Pillarsof Good Living

In the new Constitution, the essential innova-tions concerning rights in the context of GoodLiving are based on the acknowledgement of theState as a “constitutional body of rights and jus-tice” (Art. 1), versus the notion of the social Étatde droit. This change implies establishing consti-tutional guarantees that enable the immediateapplication of rights, with no need for any secon -dary legislation. The Ecuadorian Constitutionalso expands guarantees without restricting themto the legal area. There are three types of guaran-tees: normati ve, public policies, and jurisdictio -nal (Ávila, 2008: 3-4.) Public policies guaranteethe enforcement of rights.

The notion of integrality, which is a key elementof Good Living, is ensured in the Constitution bynot segregating between rights; and by recogni -zing them as interdependent and of equal impor-tance and hierarchy (Art. 11, item 6.) Nosubstantial inalienable rights and adjective rightscan be overlooked until the former are entirelyfulfilled. In this sense, the Constitution cha -llenges the liberal vision of rights borne from theidea of “freedom” (that is, certain civil rights) indetriment of “justice”, understood as equality,which was the core of the 1984 Declaration ofHuman Rights (Díaz Polanco, 2005.)

3.4. Building a Plurinationaland Intercultural State

Ecuadorian society is characterized by its cultu -ral and ethnic diversity. However, from its veryorigins, the State has not been a mirror of soci-ety, and has failed to respond to the popula-tion’s demands, particularly those of Ecuador’s

24


different peoples and nationalities. The cons-truction of a Plurinational and InterculturalState implies the incorporation of peoplesand nationalities in the framework of a uni-tary and decentralized State in which adiverse society can coexist peacefully and therights of the entire population – indigenous,afro-Ecuadorian, and white-mestizo – areguaranteed.

Given discrimination suffered since colonialtimes, reparation for the different nationalities’

and Indigenous peoples’ historic rights throughaffirmative action and the construction of thePlurinational and Intercultural State (Art. 1 ofthe Constitution) in order to allow for their fullinclusion in the State, is minimal requirementof Good Living.

The terms ‘nation’ and ‘nationality’ are usedstrategically to imprint unity and the notion ofa struggle against exclusion and inequality, butin no way do they imply forms of territorialsepa ratis m or division.

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4.1. Why Did EcuadorNeed a Change inthe New Millennium?

This Plan, which is an instrument for socialchange, is based on an analytical diagnosis ofthe evolution of economic, social and politicalprocesses that illustrate the country’s faileddevelopment in the last decades. This analysisdemonstrates the crisis, the prevailing econo -mic models, the institutional options, and thepolitical decisions at the root of many of theproblems of Ecuadorian society.

4.1.1. Backgrounds of anexcluding social contractin Republican Ecuador

Ecuador’s history of inequality is based, amongother factors, on constitutional provisions thatgenerated a large part of the population’s sys-tematic exclusion. Historian Juan Paz y Miño(2007) argues that, between 1830 and 1929, thesuccessive Ecuadorian constitutions reflectedand an oligarchic landlord republic. During thisperiod, wealth became the mechanism for thereproduction of power and the State becamethe guarantor of the reproduction of thelandowning classes.

The 1830 Constitution, in each of its 75 arti-cles, established an exclusive, sexist and racistsociety. Art. 12 stipulated that, in order to beentitled to citizenship rights, a man had to bemarried, have 300 pesos in free value, a profe -ssion, know how to read and write, and couldnot be a servant. Art. 68 named parish priests asguardians of the indigenous people since they“are innocent, abject and miserable.”

Article 9 of the constitutions of 1835, 1843,1845, 1852, and article 8 of the Constitution of1851 reproduced the exact contents of Art. 12of the 1830 Constitution, except for theamount required, which was reduced to 200pesos. Only the 1884 Constitution suppressedminimal economic requirements for individualsoccupying executive or legislative positions.

The requirement of knowing how to read andwrite was only abolished in 1979 (Paz y Miño,2007.) The fact that, in 1950, at least 44% ofthe population was illiterate, and that in themid-1970s one in four Ecuadorians could stillnot read or write (Graph 4.1), excluded a quar-ter to a half of the population from the politicalcommunity. Past constitutions, therefore, havebeen institutionalized mechanisms for socialexclusion, segmentation and stratification ofthe Ecuadorian people.

26

4. Critical Diagnosis: Three Decades of Neoliberalism,31 Months of the Citizens’ Revolution


Other forms of discrimination were directlylinked to religion, gender and ethnic origin, inthis case Indian or afro-Ecuadorian. The “BlackCharter” issued by García Moreno in 1869 sti -pulated that, in order to be considered a citizen,men had to be catholic. Black slavery was notabolished until 1852 (Paz y Miño, 2007, 5).Women were granted citizenship and the rightto vote almost one century after the republicwas established, in the Constitution of 1929.

While the Liberal Revolution (1895) advancedthe modernization of the State in areas such asrights, particularly education, it is also true thatthe State continued to be a guarantor of the oli-garchic-landholding elite until the JulyRevolution in 1925. From then on, State inter-vention in economic affairs was to be imbuedwith an instrumental rationality. Civil andpolitical rights progressed gradually, but socialrights were guaranteed almost exclusively toformal workers. Thus according to historian,Paz y Miño, the July Revolution and its govern-ment propelled Ecuador into a new politicallandscape. Latin America in the 20th century

was to be defined by a capitalist vision ofmoder nization that lasted well into the 1990’s.

The 1998 Constitution represented importantqualitative progress in the area of civil andpolitical rights. However, with regards to socialand economic reforms, the institutionalchanges clearly endorsed a model of society inwhich the individuals entitled to rights wereeither formal workers or people with purchasingpower (capable of guaranteeing their ownrights). According to this model, the indivi -duals with the greatest potential for socialmobility and the greatest potential to guaranteetheir own rights were businessmen and women,who were seen as agents capable of stimulatingthe economy and distributing the benefits ofdevelopment throughout the market.

Ecuador has now had 20 Constitutions. Sincethe Republican period, with the exception of abrief developmentalist period which had onlylimited success, the development model inEcuador has generally consisted of capital accu-mulation through the export of primary goods

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Graph 4.1: Illiteracy, 1950 - 2001

Source: SIISE, version 4.0, based on 1950 – 2001 Population and Housing Census.



(cocoa, banana, etc.), or non-renewable goods(oil).

The strategy that underlined this process overthe last few decades consisted of a rigorousdefense of the free market and of private pro -perty. According to this model, the (re)distri -bution of wealth should be filtered throughmarket forces accompanied by focalized socialpolicy in the relevant areas.

The established development model largelyexcluded Ecuadorians from the formal market,making their rights difficult to guarantee. Thenotion of rights within this development modelwas considered exclusively for those who wereformally integrated into the formal labor mar-ket, or those individuals who possessed a pur-chasing power that was sufficient to guaranteetheir rights without the need to be inserted intothe labor market.

4.1.2. Dismantling the conceptof development8

The concept of development evolved around asimplistic definition of growth. The develop-ment goals promoted in the South weredesigned to mimic the industrial processes ofthe North, which in turn would accelerate theannual growth rate of GDP. This logic wasbased upon the assumption that naturalresources were unlimited, and that the planet’scapacity to provide for an ever-increasing popu-lation was infinite.

Parallel to these discussions, CEPAL formulateda development proposal based on a strategyknown as Import Substitution Industrialization.This strategy hinged on the conviction that adeveloping country, besides absorbing popula-tion growth and labor supply, should producethe manufactured goods it is unable to obtainfrom abroad as a result of its limited capacity toimport goods (UN-ECLAC 1970). Thus, theabsence of innovative entrepreneurship suitablefor market competition should be compensated

for by means of proactive State intervention,State-led industrialization, agricultural reform,infrastructure, and modernization. Indus -trialization in the southern countries should notbe considered to be an end in itself, but a meansto harness the fruits of technological progressand increase the standard of living of its peoples(Prebisch, 1996).

This school of economists also believed thatsouthern capitalism held a specific position inthe “global system” –characterized by unfavora -ble conditions for the exchange of raw materials,unequal social structures and disproportionateincome distributions typical of countries withlow growth levels. A closer analysis of theseconditions led to the evolution of the center-periphery thesis, which was very critical of neo-classical economic doctrine. The proponents ofthe center-periphery thesis thus looked for fairersolutions to global economic problems thatwould overcome the flaws they saw in neocla -ssical economic theory (Prebisch, 1987).

However, with the onset of the structuraladjustment programs that were implemented inthe early 1980’s, this development model cameto an end, and instead efforts were focused on“managing the crisis” of world capitalism. Thecrisis, which had seriously set back the USeconomy, was attributed to the economic straincaused by financing of the Vietnam War, andthe rise of international oil prices determinedby OPEC in 1973.

The process degenerated further in the 1990’s,when the concept of development was replacedby stabilization and structural adjustment pro-grams, which were accompanied by fiscal disci-pline policies that were considered to beessential to re-launching growth in countriesthat were affected by persistent macroeconomicimbalances.

Without a serious evaluation of the resultsobtained, the newer theoretical debates ondevelopment hampered any efforts to seriously

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8 This portion of the text is mainly based on the work of Falconí y Oleas, 2004.


pursue the imports substitution industrializationmodel. The model was written off as a failure onthe grounds that excessive State interventionwas far worse than market deficiencies.Therefore, unsurprisingly, the solution was seento be the reduction of State intervention andthe liberali zation of the economy (Falconí yLeón, 2003), and thus the greatest problemswere left to be resolved by the market. All thiswas resumed in a brief agreement, the so-calledWashington Consensus9.

While it must be stated growth is clearly prefe -rable to stagnation, and constitutes the basis ofthe resources required to acquire a better qua lityof life, it is also clear that the possibility ofgenera ting additional income is no guaranteethat wealth will be transformed into sustainablehuman development.

The new phase of capitalism has not managedto maintain growth rates as before; and theincome gap between the world’s poorest andrichest populations has increased continuously.In the South, violent conflicts, hunger, epi-demics, and autocratic governments are still therule. While in the North, protected zones offorests are expanded, in the South environ -mental deterioration increases (Muradian yMartínez Alier, 2001).

4.1.3. Neoliberalism and thecrisis of economic thought10

The economic trend that has ruled the theoryof development over the last three decades,neoliberalism, is in crisis. Its incapacity to solveglobal problems is increasingly evident. The

objectives that neoliberalism set out to achieveare yet to be reached, i.e. the belief that by pri-oritizing the balancing of the most importantmacroeconomic variables in order to re-generategrowth.

In effect, the development path that evolvedwas the product of a purely econometric ana -lysis. Neoliberalism failed to take into theaccount the more global considerations thatoffer substantive arguments and “social trans -cendence” to any serious theory on develop-ment. An analytical body that neglects itsrelationship with the entire social context fromwhich it derives, loses the capacity to proposeviable solutions to society’s problems becomesirrelevant and redundant.

The route towards a new development agendastarts by modifying the nature and condition ofeconomic analysis and by recognizing the needto give more importance to the organization ofcivil society and the ways in which it shouldexpresses its democratic sovereignty. A newroute towards development should steer clear ofsuch detached economic analysis, and take intoaccount the close relationship that existsbetween economics and other branches ofknowledge such as politics, anthropo logy, socio -logy, and psychology.

Abandoning a narrow vision of the economyalso demands leaving behind deceptive claimsto political neutrality of the type heralded byneoliberalis m. It is therefore important that weunderstand that social reality is entwined withvalues and ideas that influence public policyoptions. These ideas must be contextualized in

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9 The Washington Consensus ( the product of a conference held at the Institute for International Economics , Washingtonin 1989 ) can be summarized as an economic policy model based on fiscal discipline i.e. a sufficiently reduced budget defi-cit so as to avoid having to finance it through inflation taxes; public expenditure in areas capable of generating high eco-nomic revenue and to improve income distribution (prime attention on health, basic education, and infrastructure); taxreform by expanding the tax base and cutting down marginal tax rates; financial liberalization to achieve interest ratesdetermined by the market; single and competitive exchange rates to achieve an accelerated increase in exports; liberali-zation of trade by substituting quantitative restrictions with duties, which were to be reduced gradually until minimumuniform levels were reached, of between 10% and 20%; direct foreign investment promoted by offering attractive con-cessions to foreign firms (few regulations and low royalties) ; privatization of State companies; deregulation to facilitatethe participation of new enterprises and to increase competition; and to guarantee the low-cost ownership rights to makethem accessi ble to all social sectors, including the informal sector (Achion y Williamson 1998).

10 This section of the text is mainly based on the work of Falconí y Oleas, 2004.

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their historical moment in order to gain a fullerunderstanding of the issues at hand.

Reaching beyond the boundaries of the neoli -bera l paradigm demands an understanding ofthe actors involved in given contexts from amultidisci plinary perspective.

Understanding the specific characteristics ofthe economic and social policies in Ecuadorover the last four decades enables us to identifythe priorities that should underlie the cons-truction of a new national development modeland to visualize the main guidelines for a newpublic policy agenda that establishes the foun-dation for a fair and democratic future for thecountry. The following pages are devoted tothis.

4.1.4. Developmentalism, structuraladjustment, and dollarizationin Ecuador11

Throughout the last four decades, Ecuadorpassed from a development model focused onstrong State intervention and coordination to amodel in which the State’s regulatory, redistri -butive, and planning capacities were largely dis-mantled; a step considered necessary for theopening and the liberalization the market.

The changes in the relationship between theState and the market altered the country’spoliti cal-economic agenda significantly and, atthe same time, modified the configuration ofsocial actors and groups that benefitted from orwere impaired by, the effects of such an agenda.However, it is also true that there is a certainregularity and continuity in the “social powermatrix” (Offe, 1988), which has enabled thetraditional economic power groups to main-tain broad margins of influence which haveallowed them to have a continuous hand indefining public policies favorable to their pri-vate interests.

a. The limits of Ecuadoriandevelopmentalism

In the 1960’s, for the first time in Ecuador’s his-tory, an accumulation model was visualized asan alternative to the landholding and agro-export-based economy, which had prevailed inthe country throughout the 19th century. Thenew model of accumulation was centered on adevelopmentalist State that planned and inter-vened in strategic sectors of the national eco -nomy. The process’s anti-oligarchic orientationwas manifest in the attempt to alter the struc-ture of power held by the landlords in theSierra. Through agrarian reform and policiesthat counteracted the influence of both thehighland elites and that of the coastal agro-exporting oligarchy, the State devised a new setof industrialization policies that sought to cre-ate a modern bourgeoisie.

Industrialization was seen as the principalmeans to put an end to the excessive depen -dence on the international market and to theunequal exchange rates. The Import Subs -titution Industrialization strategy progressivelyended in an implicit agreement for social mo -dernization between entrepreneurs, workers,and politicians: “... it actually came to be thefirst State policy of the Republican Era”(Mancero, 1999: 327).

This wave of reforms was conducted by the mi -ddle classes, new professionals and intellectualswho encouraged the State’s new role in mana -gement, and wanted to strengthen its technicalcapacity and public planning instruments.

Although these reform policies did not fullycomply with the redistributive goals and evenpreserved certain mechanisms that perpetuatedsocial exclusion, in the mid-1960’s the basis fora capitalist development model was consoli -dated in Ecuador, with the direct participationof the State.

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11 The fourth section of this chapter is mainly based on the works of Andrade P., 2005; Ramírez F. y Ramírez J., 2005;Ramírez F. y Rivera F., 2005; and Falconí y Oleas (2004).


However, the incipient modernizing trends inthe economic sector had no counterpart in thepolitical realm. While the State replaced someof the oligarchic mechanisms for political coor-dination, the democratization of politicsremained limited because the Executive powerreinforced its authoritarian links with society,and the traditional groups of power kept hold ofthe spaces that would allow them to have astrategic input in policy-making.

Unlike what happened in countries likeArgentina, Brazil, and Mexico, the economicgrowth model in Ecuador based on ImportSubstitution Indus trialization, together with anactive role of the State in the economy’s regula-tion and, particularly, in the distribution ofwealth, was not fully consolidated. On the con-trary, the Ecuadorian developmentalist cyclepreserved the economic growth model at theglobal level based on primary exports (mainlyagricultural and mineral exports.)

Even if, since 1925, the State had increased itscapacity to regulate the economy, it failed toacquire sufficient independence from the tradi-tional dominant sectors to be able to adoptpublic policies that would guarantee sustainedand inclusive economic growth based on theinternal market. This was a direct result of thestrong ties that existed between the State andthe landowning classes. It was a politicalalliance that included the emergent “depen-dent” urban bourgeoisie and middle classes;excluding, both politically and economically,the popular sectors which, by the end of the1960’s, were predominantly rural.

Capital intensive industrialization promoted bythe military governments between 1973 and1979 through alliances between traditionalEcuadorian oligarchic groups and transnationalcorporations eroded the working class’s capaci-ty to protest by blocking the type of politicalalliances that in other countries led to virtuoussocial integration and domestic market growth.The result was an increased dependence on thefinancial sectors (Conaghan, 1984). Finally, itimpeded an important segment of theEcuadorian population from transforming theirneeds into market demands.

b. ‘Native neoliberalism’Two periods are evident in the Ecuadorianneoliberal experience: a relaxed period from1984 to the end of the second half of the 1990’s;and a complex one that ended in 2005, after theoverthrow of ex- President Lucio Gutiérrez. Inthe first period, as a direct result of State con-trol, the dominant sectors accomplished targetsthat were essential for their economic reproduc-tion which included: exchange rate and interestrate liberalization and, most importantly, partialderegulation of the work market and of thefinancial system.

The difficult phase entailed higher levels ofpolitical con flict and turbulence between thedominant elites particularly with reference tothe orientation of the State’s reform processes.But, above all, there was social resistance fromthe Indigenous Movement, to the neoliberalpolicies, particularly the privatization of publiccompanies in the energy and social security sec-tors. All this gave rise to a difficult and lengthycontext of political weakness, institutionalinstability, and social-economic crisis thatdivided society and obstructed the developmentof common orientations regarding an economicstructure to integrate and guarantee minimumliving conditions for the large majority of thepopulation.

c. The easy cycle of the reformsWith the arrival of a corporate-wise politicalalliance to power (1984), the main proposalswere the country’s opening to the foreign mar-ket, economic liberalization, and deregulationof the economy and finances. The unfinishedpriority for industrialization, a legacy of the1970’s, was replaced with emphasis on exports,while the monetary stabilization policy startedto disassemble the central planning system.

This period’s main paradox, however, was theimpossibility of suspending State interventio -nism. The reduction of the State’s role wasselective and, once again, it reinforced subsi-dies to exports-related corporate and produc-tive sectors. In spite of the anti-State rhetoric,tariffs and duties were reinstated for certainimports; prices were again controlled for prod-ucts that had been deregulated; and controls

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were re-introduced to the exchange market.The increased public expenditure was financedwith foreign credit and loans from the CentralBank of Ecuador to the government. Thesemeasures had a negative impact on the annualinflation rates that bordered 100% by the end ofthat decade (CORDES, 1999).

Market deregulation was partial and selective;which demonstrated the decisive interventionpossessed by certain private agents in the for-mulation of economic policy, which ultimatelyled to a “neoliberal nationalization process”(Montúfar, 2000).

Moreover, the proposal that the regime tried todevelop was characterized by a personalisticanti-institutional management style with per-manent clash between the main State powers.Violent political mechanisms proliferated torepress opponents, such as the special forces andparamilitary groups that violated human rightsin a way that had never before been witnesses inthe history of the Republic.

The victory of social democracy in 1988 repre-sented, above all, a mayor rejection of the for-mer regime’s political administration. Thegovernment marked a difference by trying torecover a weakened democratic institutiona lism.This, in addition to a more open attitude towardsunions and initiatives such as the NationalLiteracy Campaign and a multilateral interna-tional policy, were signs of a relative change.

The government insisted on an economic policyof adjustment, this time, under a gradualistmore gradually. The plan contained permanentmini-devaluations and occasional macro-deva -luations; increased interest rate liberalizationand progressive elimination of preferred credit;monthly readjustment of fuel prices; eliminationof subsidies and limited wage increases (Báez,1995). From the juridical point of view, legalamendments were made in the areas of taxes,duties, manufacturing, and labor fle xibilization,

among the most important, that shored theneoliberal agenda.

However, the regime failed to achieve full eco-nomic stability. The difficulties created by therepro gramming of the debt negotiated by the for-mer administration and the speculative effect ofthis incremental reform, limited the State’sability to respond to the demands accumulatedduring over the course of an entire decade. Thepopulation revealed a considerable reduction inboth its political capital and in its power ofacquisition. In fact, from 1988 to 1992, averageinflation was 50%, and by 1992 it had surpassed60% (Barrera, 2001).

The adjustment policies implemented between1982 and 1990 have been described as a “tortuousroad” towards economic stability due to a patternof amendments in which changes were fre-quently successful, but altered immediately oreliminated in response to a variety of politicaland economic pressures and, in certain cases, asa result of external shocks or natural catastro-phes. While certain elites initiated changes,other pressure groups, economic sectors, politi-cal parties and, to a lesser extent, popularprotests, tired to hamper them (Thoumi yGrindle, 1992).

The most consistent attempts to advance astructural amendment agenda consisted of a sta-bilization program that was implementedbetween 1992 and 1995 in an effort to restoreexpectations of inflation, eliminate fiscaldeficit, reduce exchange rate volatility12, attractforeign investment, and reduce the size of theState. This agenda was part of the letter ofintention negotiated with the IMF to make wayfor the renegotiating of the foreign debt.

At the beginning of this period the decision wasmade to leave OPEC, liberalize the exporters’currency sale, and promote the privatization ofState companies. The government expressed itsdecisive will to follow the path of neoliberal

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12 The exchange rate which, following a disproportionate devaluation, was established at a fixed rate, with the intentionof serving as an anchor of inflation because of fiscal discipline; and was fixed at 2000 sucres per dollar. This mechanismwas similar to that used in Mexico. The Argentinean convertibility (2001) can also be seen as a case of nominal anchor.


modernization. It was clear that it was not amodel based on either recovery plans or (re)dis-tribution. The public agenda failed to take intoaccount structural problems, such as income(re)distribution, and the positive effects thatwere experienced were largely a by-product ofrelative price stability.

In 1994, the Law for the Financial Insti -tutions was passed to liberalize the bankingbusiness. The controlling capacity of theSuperintendence of Banks was left to thefreewill of the private banks association; “finan-cial groups” were formalized, and insider loanswere allowed for up to 60% of the grantors’technical equity. In the following years, theconsequences of these deregulating measureswere fatal for the country.

Nevertheless, and in spite of the political affi -nity with the strong parties present in theNational Congress, the government was unableto consolidate a sound majority and negotia-tions with the Social Christian Party (PSC)opened the road to the breakdown of the poli -tical system. The reaction from certain publicsectors was, however, significant. In view of aweakened union sector, the IndigenousMovement appeared as a strong faction with aconvincing political project. The main lines ofconflict with the Government were related tothe struggle for social security guarantee and theneed to expand of policies such as agrarianreform, particularly for peasants. There was awide-spread rejection of privatizations and tothe increase of strategic resource prices, such asgas, oil-derivatives, petrol, and electricity.

The results of the economic policy showed that,by 1994, inflation had dropped to 25.4%; thefiscal balance had a 1.2 surplus in relation tothe GDP, and the country possessed reservesthat exceeded 1.7 billion dollars. Even econo -mic growth seemed to recover (Araujo, 1999).In this context, the administration sought toadvance some structural of the reforms that

had been postponed for a long time. Laws wereissued to make stock exchange more flexible, torestrict public expenditure, and to facilitateforeign investment in the oil sector by deregu-lating fuel prices. In addition, economic stabi-lization came with winding and partial publicdisinvestment. Ten State companies were priva-tized for an amount of 168 million dollars(Nazmi, 2001).

The limited consistency of the government’spolitical agreements obstructed the viability ofits objectives. Disputes between factions proli -ferated. However, the country’s political con-flict was not the sole result of social protests,nor was it the entirely attributable to the pre -sence of the anti-reform parties. In fact, a con-siderable proportion of political inconformitywas due to the disputes among the economicpower groups13.

By the end of 1995, the government called for areferendum “The basic content of the confronta-tion revolved around the social service systemand work deregulation in the public sector”(Ibarra, 1996:19). Around 58% of the votersrejected the reforms and caused the politicaldefeat of the neoliberal agenda. Allegations ofcorruption against the regime’s economic policyadded to the failure. After a political trial, thehead of the government fled the country. Theneo-conservative project, thus, lost its bestchance to crystallize.

The problems for the sta bilization process had aperverse effect – Petroecuador sunk into theworst defunding of its history. A series of debitsto its accounts made by the Ministry de Financein 1995 left the State oil company with a deficitof around 70 million dollars that year. This, inaddition to the administrative managementplaced Petroecuador in an extremely weak situ-ation of which it still has not recovered.Transnational companies took the lead andnational interests were placed under privatelocal and transnational benefits.

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13 Most privatizations determined by the National Modernization Council (CONAM) in areas such as telecommunica-tions or electricity, for example, were not made effective due to such disputes.

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d. Neoliberalism’s Difficult Phase:From Financial Crisis to the ExtremeNominal Anchor

Between 1997 and 2000, there were five succe -ssive governments. Two presidents were deposedand fled the country to evade legal corruptioncharges. The political crisis, combined withsocial protests, and conflicts among the elites,sunk the country into a deep socio-economiccrisis. The outcome was a hasty self-mutilationof the monetary policy based on the economy’sdollarization.

Bucaram’s populist government (1996-1997)proved to divert only marginally from the previ-ous economic agenda. Bucaram introduced areasonably broad set of economic reforms aimedat establishing a monetary convertibility systeminspired by the Argentinean proposal14. He alsoincluded a series of measures that were designedto suppress fiscal subsidies and price hikes; aswell as bringing about an aggressive wave of pri-vatizations. The administration introduced sig-nificant reforms into both the oil sector, and insocial security.

Although this agenda reassured both the cor-porate sectors and numerous internationalorganizations, it simultaneously sparked politi-cal confrontation on two fronts. On the onehand, the traditional economic elites wereupset with the government’s growing dependenceon new trading groups, disconnected from thetraditional exclusionary circuits of theGuayaquil oligarchy. On the other hand, the“anti-adjustment” policies generated opposi-tion from within the indigenous and socialorganizations that had been gradually strength-ened over the last few years.

The combination of these factors turned out tohave a high political cost, and the regime wasquickly worn out. Authoritarian undertonesmarked the government’s political relationswith a number of sectors, in an attempt to abatethe financing of groups linked to the SocialChristian Party. This was exacerbated by theunwillingness to address the evident corruptionand inefficiency of senior public officials.Combined, these factors led to the isolation ofthe Bucaram administration in less than sixmonths. A new wave of social mobilizationsculminated in the overthrowing of the regimein February 1997,

Following a weak interim government, theDemocratic Christian Party rose to power amidstsocial and political conflict and economic deba-cle. The El Niño Phenomena, the irresponsiblebehavior of the bank control authorities, theeffects of financial deregulation, the lack ofgover nance, and wide-spread corruption, led thecountry into an unparalleled crisis. With theencouragement of the main political parties, inDecember 1998, the government guaranteedunlimited deposits to the financial system15.

Since 1999, the two major, recurrent economicproblems were the frail nature of the financialsystem and fiscal weakness. The government’seconomic authorities set no limit to the assis-tance it provided to the collapsing banks16. Inpractice, the State’s intervention was unable toavoid the sector’s insolvency and ratherabsorbed the private loss through taxes, inflation,and the dissolution of the national currency.

In March 1999, the crisis reached its peak – the“bank holiday” was decreed and savings deposits

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14 A monetary policy that “through legal changes, indissolubly links the monetary supply to currency availability in theinternational monetary reserve, and establishes the corresponding parity (typically, one to one) between the new natio-nal currency and the US currency. In conclusion, a bi-monetary system was to be established in the country” (Romero,1999.)

15 In the National Congress, meanwhile, the PSC – parliamentary partner of Mahuad – managed to eliminate the AGD’sright to intervene in goods and in the bankers’ related companies, and obstructed the granting of immunity to controlauthorities and prosecute the bankers who violated the law (Revista Vistazo No. 779, Feb. 2000.)

16 The successive governments since the early 90’s had acted in similar ways. In 1996, for example, billions of sucres werespent on saving the Banco Continental, whose owners had fled to Miami (Ecuador Debate No. 47, Aug. 1999).


were frozen. The Central Bank, in turn, pursuedits policy of intense currency emission to avoidthe collapse of the financial system. In this way,the State situated itself at the core of the reco -very of the insolvent financial sectors.

The government assumed that the generalreduction of activities, the immobility of invest-ments, the total or partial closure of companies,and the rise of unemployment could be regar -ded as minor issues17. Once again, it gave prio -rity to providing stability to the banking sectorover and above the reactivation of productiveactivities. The power of the economic groupslinked to the banking system directly influ-enced the orientation of the public agenda.After 20 years of performance, the democraticinstitution had still not reached sufficient matu-rity to prevent economic interests from transla -ting itself into unrestrained political power.

The year 2000 began with an uncontrollableeconomic situation and an illegitimate govern-ment. In this situation, the dollarization for -mula emerged as some kind of political buoy forthe presidency,18 rather than providing a techni-cal solution. Annual inflation reached 100%and the value of the currency set by the govern-ment to start the “dollarization” topped 25,000sucres per dollar. Shortly after, the State startedadministering approximately 59% of the assets,60% of liabilities, and over 70% of the financialsystem’s equity19.

The contradiction is evident. If, on one hand,the budget for the social sector was decreasedand the focus set on reducing the fiscal deficit;

on the other hand, there was a continuous flowof support filtered to the private sector. Thiscaused a perverse effect by increasing the fiscaldeficit, that is, the opposite effect to that postu-lated by neoclassic economists. In the country,the private sector’s imbalances and resourcerequirements have explained the deficit and,thus, the need for continuous fiscal adjustmentmeasures (Izurieta, 2000, in Ramírez R., 2002).

The factors that led to the growing inequality inthe country can be understood within thisframework. The demands of economic policy,through prioritizing stability through fiscaladjustment, not only turned the social policyinto a subsidiary and assistance policy, but alsomade it unsubstantial for wealth (re)distribution.This is how inequality is explained in relationto the few resources destined to social invest-ment, to expenditure cuts in the second half ofthe decade aimed at reducing the fiscal burden,and inefficiency in focusing on social emer-gency programs which never promoted socialmobility. As a result, the “new” social policyhad almost no impact either on poverty or onthe population’s wellbeing (Vos, et. al, 2000, yRamírez R., 2002).

The dollarization gave way to a political reper-cussion that re-articulated corporate, financialsectors as well as the center-right and right-wing parties around the president’s proposal20.Even so, indigenous mobilization once againsparked and formed an alliance with the highmilitary command. Indians marched to the capi -tal of the Republic and, on January 21, 2000,Army officers and troops made their entrance

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17 According to the Superintendence of Companies, in 1999, 2500 companies were closed (not only small and medium com-panies, but even firms in modern and dynamic sectors, such as the banana, shrimp, and fishing sectors). Likewise, openunemployment in the economy’s formal sector passed from 9.2% in March 1998 to 17% by July 1999 (Romero, 1999).

18 A few days before announcing the dollarization, the president himself called his measure as “a jump to nowhere.”However, at times when the regime’s stability was under threat, and even contrary to the opinion of many officers ofthe Central Bank of Ecuador, the Executive made the jump to nowhere. Shortly after, the measure was ratified by hissuccessor. Alberto Acosta (2000) recollects the Presidency’s uncertainty with respect to dollarization: “Mahuad’sMinister of Finance himself recognized in an interview published in Brazilian newspaper ‘Folha de Sao Paulo’(17.1.2000) that ‘dollarization is a desperate move’ (....) CORDES, an organization chaired by former president andMahuad’s political peer Oswaldo Hurtado, stated that it was a ‘political move with no technical preparedness’ (....)”

19 Acosta A. 2000: 14; Central Bank of Ecuador, 2002: 43.20 Two days after the dollarization was announced, Mahuad’s reputation improved. Various parties, including the PSC, the

PRE, and the DP-(the government party), announced the legislative backing to the proposal with which its politicalviability was assured. The corporate and small industries chambers also approved the measure (Revista Gestión No. 67,Revista Vistazo No. 667.)

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into to the National Congress. The presidentwas overthrown during the night.

The new government had no participation inthe National Congress and, amidst a new waveof social protests led by the Indian Movement,sought to stabilize the economy in the shortterm by maintaining dollarization and promo -ting foreign investment in the oil sector. Noattention was paid to the other social and eco-nomic pro blems. The frailty of the politicalsitu ation blocked certain privatization initia-tives which were left in to one side, in anticipa-tion of a change of power.

The first moves towards dollarization were notentirely negative due to a favorable interna-tional economic conditions, defined by risingoil prices; the increase in the amount of moneyreceived in remittances from Ecuadorian wor -kers who migrated to industrialized countries–which incidentally became the country’s se -cond largest source of income after oil exports–;and the construction of the new Heavy CrudeOil Pipeline that began in 2001 which financing

was the largest foreign investment in Ecuadorsince the 1960’s (Larrea, 2002).

As a result of the relative price unbalance at thetime of the dollarization, the capacity of the oli-gopolies and other economic agents to raiseprices, and the partial reduction of some subsi-dies, revealed high inflation rates. Their persis -tence and magni tude not only eliminated thetemporary advantages achieved by the externalsector in the real exchange rate during themonths following the dollarization, but alsoreverted the situation and seriously affected thecountry’s international competitiveness.

The local production’s progressive loss of com-petitiveness seems to the “Achilles’ heel” ofdollarization. The deterioration of the balanceof trade was apparent: it varied from a surplus of1,458 billion dollars in 2000 to a deficit of 969million in 2002, and 31 million in 2003. Thefurther results of the balance of trade respondedmainly to the increase in oil prices. Positive ba -lances were recorded since 2004, with a peak of1,448 billion in 2006.

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Graph 4.2: Evolution of the trade balance 2000-2006

Source: Banco Central del Ecuador.



Without monetary emission, exports constitutethe main source of currency supply. In a contextof commercial liberalization, dollarizationobstructs any reaction to and the use of instru-ments that our neighbor economies rely on iftheir local producers lose competitiveness. Theway in which this process was managed trans-lated into a failure to level out the domesticinterest rates with the international rates, andto guarantee access to the international finan-cial markets.

Besides, in the political phase that followed,two problems emerged and complicated themonetary scheme’s sustainability. Firstly, theregulation of the fiscal policy implemented bythe Organic Law for Fiscal Responsibility,Stabilization and Transparency (LOREYTF),issued in June 2002, gave priority to payingand repurchasing the foreign debt; and social

investment was restricted by placing a peak of3.5% of real annual growth. Legal pre-assign-ments practically reduced the possibility ofexercising an anti cyclical policy to zero. Ifdolla rization was a straightjacket for a mone-tary policy alienated by banking rescue plans,LOREYTF left the Minister of Economy tothe role of a public expenditure cashier.

The second problem was less evident but equa -lly or more significant: the extreme nominalanchor failed to change the agents’ conduct anddistributive problems continued to be managedin the way that they were handled under condi-tions of relative monetary sovereignty, andtaken care of by the issuing Central Bank. Theneed for currency encouraged private andpublic actors to advance solve economic pro -blems through the increasing exploitation ofnatural resources (Falconí y Jácome 2002)21.

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Graph 4.3: Evolution of non-oil trade balance 1990- 2006



21 The construction of the Heavy Crude Oil Pipeline (OCP), which crosses different environmentally sensitive zones— such as Mindo — is a clear example of this trend.

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Nevertheless, the non-oil balance of traderecorded a constant deficit since the first year ofthe dollarization. In 2000, the deficit reached

728 million dollars, and in 2006, 3,714 milliondollars. It is thus evident that dollarization hasnot dynamized exports.


A growth rate that was always less than thatproposed by those who supported dollarization,increased inequality and social exclusion, asdemonstrated by poverty, inequality, wages, andlabor indicators. If in the early stages of dolla -rization these indicators were partially relaxed,the inflexible nature of the monetary schemewas already sending warning signs about theprecarious conditions that would be faced bythe majority.

By means of conclusion, Ecuadorian economichistory over the last decade is less related todevelopment and more related to growth fai -lure. In the long term, the results of the combi-nation of the above-mentioned factors could beassimilated to the model proposed globally byneoliberalism, with evident inconsistencies.This model, in a society of permanent clashesbetween bourgeois factions, acquires comple -tely original dynamics that could be called“native neoliberalism”.

4.1.5. Commercial opening: wasthe Economy democratized?22

Contrary to the electoral promises made, the riseof Sociedad Patriótica to power (2003-2005) inalliance with Pachakutik, the IndigenousMovement’s political branch, pursued the sameeconomic policy as their predecessors.

Endorsed by the agreements made with theIMF, the President of Sociedad Patriótica keptfiscal policy as the single mechanism for adjust-ment in a dollarized economy. He decreed theincrease of oil and oil derivatives and publicservice prices. His foreign policy revealed a sus-picious alignment with the US counterdrugagenda, embodied in Plan Colombia. Thesepolicy decisions caused the IndigenousMovement to withdraw from the governmentalalliance it had joined into, campaigning for the

end of neoliberalism. The gradual distancingfrom electoral offers and the increased percep-tion of authoritarianism and disregard for demo -cratic institutions played an important part inthe government’s overthrow in April 2005.Once again, powerful citizen demonstrationsforced the change of mandate.

Although many of the senior officers ofSociedad Patriótica were military, ex military,and relatives of the party’s main leaders, thestrategic positions in institutions that were keyto maintaining the economic agenda were filledin by individuals with strong links to the coun-try’s traditional banking and corporate circles.This has been one of the main strategies used bythe powerful groups over the last two decades inorder to maintain their spaces of power andcontrol over the economy.

The neoliberal promise of economic growthbased on the promotion and liberalization ofexports was attractive and easy to implement.The effects in terms of power and resource re-concentration, restructuring and realigning ofthe powerful sectors of the Ecuadorian economywere particularly evident at three levels:

• A new ‘proletarization phase’ of theEcuadorian agricultural sector, alteredthe composition of the powerful sectorsand changed the relations between thosesectors and the agrarian workers. Whilethe promotion of exports did not implyan effective expansion and diversifica-tion of the country’s productive structure,it did contribute to the dynamism of cer-tain segments of Ecuadorian privateexports, such as shrimp and flower pro-duction.23 This, however, occurred inadverse conditions due to technologicalenhancement that took place in the midstof a phase of persistent concentration of

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22 This portion of the document is mainly based on the works of Andrade P., 2005.23 Between 1990 and 1998, flower exports’ FOB value went from US$ 13,598,000 to US$ 161,962,000, that is, the value

was multiplied by twelve; in 1998, flower exports were 5% of the total exports (Larrea, 2004; Korovkin, 2004, the au -thors quote statistics from the Central Bank of Ecuador), by 1998, the sector had generated 36,000 jobs. In this period(1990-1998), Ecuador went from being a marginal fresh flower exporter to a Third-World producer (World Bank,2004: 87.)


productive assets. The property of fertileagricultural land was placed in few handsdespite the large number of landless pea -sant families. Likewise, neoliberal laborflexibilization reduced the workers’opportunities to organize themselves intounions.24

• From 1994 onwards, the Ecuadorianfinancial system’s internationalizationculminated in massive bankruptcy ofbanks and other financial entitiesbetween 1998 and 2000. The deregula-tion of financial control laws weakenedthe State’s capacity to control the finan-cial operations performed among eco-nomic groups and the banks in whichthey were majority shareholder.

Although it was the middle-class and thepopular classes that endured the maindamages of the economic collapse, therelations between the powerful sectorswere also changed as a direct result of theeconomic collapse and the dollarizationof the economy. In an economy organizedin oligopolies, the groups that wereformed constitute the core of the “newpowerful sectors,” surrounded by minordependent groups. The dollarization andpayment of a heavy foreign debt wereclearly the mechanisms that articulatedthe relations between the most influen-tial political groups in Ecuadorian societyat that time. These factors were influen-tial in the decisions that determined thatunder a new monetary system, the exportmodel was reinstated.

• Transfer of equity and assets (decapita -lization) to pay the debt. The availableevidence shows that, after the bankingcrisis and the dollarization that tookplace in 2000, the key factor in theEcuadorian economic recovery was the

new oil boom. The opening of new oilfields and the construction of the new oilpipeline were possible because of theState’s association with foreign trans -national corporations and the high inter-national prices. However, unlike whathappened in the 1960’s, the State hadnot presently not invested in any eco-nomic resources to develop industrialinfrastructure, but rather in promotingprivate primary exports (flowers), payingthe foreign debt, and financing imports.The foreign debt payment is directlyrelated to strengthening some economicgroups in the financial sector.

The Ecuadorian people, thus, not onlydid not receive any benefit from the oilboom’s income, but were forced intoeven greater austerity in public expendi-ture to create the necessary surplus to paythe public debt.

Dollarization has influenced and conti -nues to influence the economic strategiesadopted by power groups– it has fostereda demand led by the preferences of con-sumers with the greatest purchasingpower, who buy imported products andservices provided in many cases by inter-national franchises that are also con-trolled by oligopolies composed by majoreconomic groups.

In summary, in spite of that fact that the roadtowards oligarchic domination is not as preva-lent as it had appeared at the end of the 20th

century, at present, the aforementioned actorsand power groups still hold huge de facto poweron key segments of the democratic institutionsand political decisions in the National State.

The power battles between the most affluentsectors of society created opportunities that ledto the appearance of new actors, which united

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24 Banana exports also grew in the studied period due to the conditions resulting from labor flexi bilization, among otherreasons.

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with social movements, particularly theIndigenous Movement and other collectiveorganizations that resisted the structural adjust-ment policies of the 1990’s. They emerged inthe form of assemblies, citizen movements andsocial coalitions that further weakened thelegitimacy of the political parties’ and deman -ded the definitive departure from the neolibe ralexperiment in Ecuador.

4.1.6. A global balanceof the neoliberal policy

The above-described panorama leads us to con-clude that the growth model implemented inEcuador over the last 15 years has led to the sim-pli fication of national production due to theprevalence of economic sectors that generateincome from favorable international prices, atthe cost of a national productive structure.

Competitiveness focused on the cost-reductionof labor, and on obtaining extractive income indetriment to the ecosystem: together with mar-ket deregulation and an inefficient taxing system

that obstructs the collection of fiscal revenuefrom capital and taxpayers with higher incomesare all neoliberal practices that resulted in theserious weakening of the effective functioning ofthe State. Needless to say, the State’s role as theguarantor of rights, a producer of quality publicgoods, and an efficient promoter of stable andsovereign human development were paralyzedby the neoliberal experiment.

Consequently, the weakness of both the Stateinstitutions and of the productive apparatus wasevident by the end of the last century due to itsincapacity to adequately confront adverse fac-tors, such as El Niño (1998) and the banking cri-sis (1999). Both events determined an increasefrom 12.84% to 52.18% in the rate of povertyexperienced by the country’s population between1995 and 1999. Six years later, in 2006, thenomi nal stability expected from dollarizationpermitted poverty and extreme poverty rates toreturn to levels similar to those recorded onedecade before. However, given the populationgrowth over the last 10 years, at present there aremore poor people in absolute terms (Chart 4.1).

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Chart 4.1: Evolution poverty and extreme poverty in consumption, 1995 – 2006

–as a percentage of population–

Source: SIISE-INEC, based on INEC, ECV. Several years.



The problems resulting from the natural disas-ters, the financial crisis, or the change of curren-cy did not have a symmetric impact on thepopulation. According to ENEMDUR, between1990 and 2006, only the highest income stratadid not experience any setback in their percapita income; while the first eight tenths of

the population systematically saw their incomeperception levels fall. Throughout the men-tioned period, social polarization is clear (graph4.4): while in 1990 the difference between therichest 10% was 18.6 times higher than thepoorest 10%; in 2006 this difference is 28 timeshigher (Ramírez R., 2007).

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Graph 4.4: Concentration of household per-capita income

Source: ENEMDUR, 1990-2006.


As mentioned above, the period of liberalizationwas conducive to better qualified labor which,in turn, increased the wage gap between quali-fied and un-qualified workers. Additionally, thiscontributed to an increased concentration ofincome and inequality as described above.25

Growth, interpreted in an abstract sense26 andmacroeconomic stability are necessary but do

not translate automatically into povertyreduction. Furthermore, growth and macrostability should not be considered to be deve-lopment objectives per se, but rather beunderstood as instruments that need to bearticulated to the benefit of the poorer sectorsof society. i.e., they must simultaneously takeinto consideration mechanisms for the inclu-sion of the country’s most vulnerable groups

25 This process appears not to have changed very much, in as much as the average level of education amongst employeedevoted to export-related activities (the so-called tradable sector) is almost 4 times higher than that in sectors devotedto covering the internal market (economy’s so-called non-tradable sector).

26 The term abstract growth implies that it does not create a productive structure capable of integrating national laborand promoting national sovereignty versus variations by external factors.

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into both the social and the productive infra-structure of the State.

Household income and consumption have notbeen distributed equitably; this has deterredadded-value growth and the possibilities for theexpansion of the national economy. However,production has also undergone an industrialconcentration process that has benefited price-

fixing companies to the detriment of price-takingcompanies27; it has limited real competitiveconditions; and obstructed transparent marketpractices and the expansion of formal, well-compensated, and inclusive labor demand. Theindustrial concentration in Ecuador, as mea -sured by the Gini coefficient, proves that indus-trial production is in the hands of a fewcompanies (Chart 4.2).

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Chart 4.2: Industrial concentration 2005*: The Gini Coefficient**

* Branches selected at random.

** The Gini coefficient is a statistic measure for distributive inequality that varies from 0 to 1. The more close to 1 the more inequality; and a

hypothetical fully equitable distribution would be 0.

(1) Thirty one companies of which seven reported no sales.

(2) Ninety seven companies of which 46 reported no sales.

(3) Eighty companies of which 18 reported no sales.

(4) First one hundred companies in sales.

(5) First one hundred companies in sales.

Source: Producto Indicador, 2005.


While it can be said that the external sectordrives economic growth, it is also true that thetype of economic growth that is generated isdisproportionately distributed throughout thecountry, and thus not conducive to develop-ment.

In spite of the fact that the strongest period ofthe economy’s libera lization gave relativeimportance to the productive apparatus’s trada -ble sectors (those able to trade in the inter-national market), over the last decade thesesectors experienced only limited increase inproductivity. Between 1992 and 1997, therewas a 2.4% increase on all tradables and1.3% for non tradables, excluding oil. Simul -taneously, branches with intense capital use– oil (tradable), electricity, and water (until

then non-tradable) – experienced significantgrowth in their productivity (8.5% and 13%,respectively.) However, demand for labor inthese areas only reached 0.7% of the totaldemand for labor in non-agricultural sectors.Meanwhile, non-agricultural non-tradableactivities that reached 82.7% of the total non-agricultural labor demand underwent a fall of0.9% in their productivity (Vos, 2002).

While these data tell us about two lost decadesvis-à-vis development, there is also an illusionof growth that stemmed from the country’shousing crisis after the banking rescue, fosteredby the elites in 1999 to support a sector thatsuffe red from huge management deficienciesand broad discretionary margins and interestslinked to the management of citizens’ savings.

27 Price-setting companies are monopolistic entities that increase their products’ prices without facing a significant reduc-tion in demand. Price-taking companies, on the other hand, are small companies that have no major influence on themarket’s price determination.


Since 2000, the main argument to keep dolla -rization was based on the need for increasingexports to finance the external balance in ageneral scenario of economic liberalization.The results show this strategy’s failure. Between2000 and 2005, the Ecuadorian economy’sopening index increased from 0.748 to 0.812which, according to the prevailing orthodoxy

would indicate an appropriate evolution. Thebalance of trade, however, declined. The actualincrease in imports was equivalent to 45.1%,but exports only grew 34.1%, particularly due tothe increase in international oil prices, a vari-able which is completely uncontrollable andhinges almost entirely on external factors(Graph 4.5).

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Graph 4.5: Exports and imports 1993 - 2006

–as a percentage of GDP–



The prompt increase in imports and the slowgrowth of non-oil exports explain the limitedpossibilities of generating dignified work. Thiscontributed to the deterioration of living condi-tions through unemployment, underemploy-ment, and a real decrease in wages.

While the surge in oil exports contributes tosustain fiscal expenditure, it is not a real optionfor labor growth since the small amount of workgenerated in this activity largely depends oncapital. Ultimately, such openings, which havebeen negative since 2001, are supported by the

remittances sent from abroad by workers whohave fled the country (Graph 4.6).

Society has endured the consequences of thestructural adjustment imposed by the coalition ofexternal political and economic forces, and thenational elites who did not have a project of theirown beyond accumulation and defen ding theirprivileged positions. The effects are indisputable:an increasingly fragmented, polarized society inwhich the deterioration of many people’s lives isevident; a society that is increasingly and unfair-ly intransigent, and inclined towards continuouspolitical instabi lity and conflictive issues.

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4.1.7. Ecuador’s challengesin the world crisis

Crises are part of the system. Over the last 200years, there have been 23 economic crises inthe so-called First-World countries. The currentcrisis is not only financial – this has been thelast visible characteristic. It is also a crisis ofethics and trust, a food crisis, an energy and anenvironmental crisis, and most relevant, a crisisof the entire capitalist system. The internatio nalfinancial crisis was accentuated in the eyes ofthe world when the US financial market collap -se, and spread its effects to the rest of the world.The South, which has no responsibility for thiscrisis, is now its victim.

Within the context of neoliberal policy, thelogical solutions to this crisis would have beenpolitical, pro-cyclical, and fiscal austerity mea -sures. In the commercial sphere, a senseless andindiscriminate liberalization would have beenput in place and adjustments would have beenmade through the flexibili zation of labor.

Ecuador has faced the crisis by implementingmeasures that respond to a new post-neoliberal

vision: anti cyclic measures aimed to keep thepoorest sectors from being affected. TheGovernment has designed policies to protectthe country from the crisis – short-term policiesto confront it and medium- and long-term poli-cies to promote a different model for generatingwealth. In this way, we have taken steps toavoid the country’s vulnerability. Had therebeen more time to reap the results of thismacroeconomic policy, this crisis would haveaffected us much less.

The immaculately timed efforts made by ourcountry to recover the State’s role since 2006 mustcontinue. They must be strengthened and priori-tized in two ways: firstly, through the efficient useof public resources that have been diminished byeffects of the crisis; secondly, by strengtheningnational support for the agenda for reform con-tained in this Plan so as to pass over the crisiswithout affec ting the poorest sectors of society andwithout sacrificing the main objectives of GoodLiving or the State’s transformation.

Additionally, in the economic arena, it is clearthat the crisis will influence the cash flow and

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Graph 4.6: Income from remittances and migration 1990 - 2006

Note: The 2006 data on migration flows are collected until September.

Source: Banco Central del Ecuador, Instituto de Estadísticas y Censos.



this will be reflected through restrictionsimposed on the post- neoliberal program.Accordingly, budget re-programming must beaccounted for in the short, medium, and longterms, in order to guarantee a consensus on thepriorities that should define the process and anefficient use of internal resources applied to thenational development strategy. Finally, effortsmust be made to find the required externalfinancing sources (multilateral, regional, orbilateral) with respect to national sovereignty.

Regarding income, expanding the tax reform willbe an ongoing challenge based on the unders -tanding that no strong distributive incidence ispossible without a sound collecting capacity.

The need to maximize oil reserves and diversifyproduction, including the generation of addedvalue for primary goods and market diversifica-tion, are urgent measures that must be under-taken in order to reduce the effects of theformerly described external shocks.

Regarding expenditure, the reduction ofbureaucratic administrative transaction costsmust be promoted in order to facilitate theimplementation of public policies.

In what concerns the regulatory function, theconso lidation and implementation of a newfinancial architecture that incorporates a varietyof popular finance initiatives should be consi -dered a priority. In addition to this however, it isalso crucial to have transparent and agile fiscalmanagement; to reduce economic insecu rity; andallow for the re-launching of long-term privateinitiatives (particularly within the po pular andsolidarity economy, but also in the corporateeconomy) in order to protect labor and reactivateproduction within previously excluded sectors ofsociety. These measures are vital if we are to tack-le the problem from the root, and thus to reacti-vate the people’s economy. The role of the IESSBank, the re-launching of the capital market, theFinancial Security Network, and the new respon-sibilities set for the public banking sector, all formpart of this new financial architecture.

The search for an intelligent and sovereign inser-tion of the commercial sphere into the interna-

tional arena must be considered. While in theshort term the main challenge involved keepingspaces open in existing markets; the medium andlong term goals must be to diver sify the markets.The type of insertion that Ecuador strives toachieve prioritizes South-South integration, andthe efforts to consolidate UNASUR. The under-lying challenge is to continue supporting theagen da of the countries that are seeking to esta -blish new rules of the game to establish a diffe -rent international power balance.

In view of the possible war of devaluations, alegitimate and operative exchange safeguardmechanism, with border control measures,needs to be incorporated within the interna-tional regulations to block the entrance ofproducts that could harm the national produc-tion in a timely manner.

The negotiation of agreements resembling freetrade agreements must be prevented in order tosuccessfully foster an endogenous economic modelfor Good Living. Likewise, efforts should be madeto strengthen Ecuador’s case in the legal battles itfaces against international corporations: thus thevalue that is at stake is equi valent to the entireannual budget in Ecuador, thus limiting furtherpossibilities to bring about much needed change.

Politically, bad management of the crisis wouldsignify falling into the hands of the opposition;therefore, political management must befocused on building a strategy that preventsanti-crisis measures from falling into chaos.General rules must be firmly set in place so as toreconfigure a model that is not only conduciveto good governance, but also to the ongoingconstruction of the national development goals.

4.1.8. Demographic TrendsA long-term strategy needs to take into consi -deration demographic trends and variationsthroughout a given period.

According to the projections, by 2025 Ecuador’spopulation will have reached 17.1 millioninhabitants. It is expected that the growth willslow, reaching an average annual rate of 1.1%after 2020; the fertility rate is expected to be 2.1

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children per woman. A larger population is,thus, expected but with a slower growth rate.

Simultaneously, life expectancy at birth isexpected to reach 77.5 years; and child morta lityrates are expected to drop by almost to half, i.e.,from 20 to 11 thousand live births between 2008and 2025. As a result, the balance between thedifferent age groups will change significantly.

The relative importance of the populationunder 15 will drop from 31.2% to 24.5%; whilethe population between 15 and 64 will rise from63 to 66%; and the population 65 years andolder will rise from 6 to 9.3%28. In other words,we are confronting a more accentuated demo-graphic ageing process, as the following graphs,which illustrate the Ecuadorian population evo-lution pyramids since 1980, show.

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Graph 4.7: Population distribution per sex and age, 1982; 2008; 2025

28 Projections also show that, resulting from the sustained drop of fertility and the progressive increase of the population’slife expectancy, the demographic aging rate will almost duplicate its figure between 2008 and 2025 – at present, per 100persons under 15 there are 27 individuals 60 and over; by the end of the first quarter of this century, there will be 54.


The change in the pyramid means that thepopu lation of working adults will increase,while the population under 15s will decrease29.This will create a so-called “window of oppor-tunities”, i.e., the period when the maingrowth of the population in working agesenables an increase in national production andwealth through the progressive incorporationinto the labor market30.

Additionally, the changes in the age profile willlead to important changes in economic con-sumption. During the next 17 years, the averageannual growth of goods and services demandedby the population under 15 years old is likely toturn negative (-0,1%.) Meanwhile, the demandof the population between 15 and 64 years oldwill rise at an average annual rate of 1.5%; andthat of elder adults is expected to reach an ave -rage annual rhythm of 2.4 times higher than theformer level (3.8%).

As with consumption, the demand for healthservices by the older adult population’s willgrow at a significantly higher rate than that ofthe population ranging between 15 and 64 yearsold (3.8% versus 1.9%, respectively); and thatof persons under 15 years old will turn negative(-0,2%).

According to projections that estimate that thepercentage of the population from 5 to 14 yearsold will start dropping from 2010 onwards,demand for basic education is likely to startdropping as well. Regarding secondary educa-tion, the population between 15 and 17 yearsold will increase by 2015, and decrease there-after. Unlike the former sub-groups, the popu-lation that is likely to demand highereducation, i.e., those between 18 and 24 willincrease and will reach 1,983,000 persons by2025. Therefore, significant emphasis must beplaced on higher education, taking into

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29 In absolute terms, the population under 15 will drop in around 108,000 individuals (average of 6,300 per sons per year);while the population in working and elder adult ages will increase in 2,600,760 per sons.

30 In this context, the demographic dependence rate will record a sustained drop of around 51% by 2025.

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Source: INEC-1982 Population Census, Population Projections 2008 & 2025.



account the increase in the EconomicallyActive Population.

In fact, projections suggest that the EAP willincrease at an average annual rate of 2.2%31.This means that every year, an average ofaround 170,000 persons will be incorporatedinto the labor force. If this is the case, 154,000annual jobs will need to be created just tomaintain the current unemployment rate ataround 7%.

4.2. 31 Months of theCitizens’ Revolution

4.2.1. The Political Change:A Democratic Severance fromthe Oligarchic Domination

On April 27, 2009, 51.99% of the voters rati-fied the political project of Movimiento PatriaAltiva y Soberna (PAIS) and, in an unprece-dented victory; candidates Correa-Morenowere elected in the first round for the period2009-2013. After 10 years of political instabili-ty and social unrest, the Ecuadorian peoplechose to hand over power to a movement thatembodies not only high hopes for change, but amovement that offers real possibilities forchange enshrined in a progressive, humane andintegral understanding of what constitutesdevelopment.

Prior to the elections in April 2009, the peoplevoted in favor of the proposed changes on threeseparate occasions: the refe rendum for aConstituent Assembly was ratified; the repre-sentatives to the National Assembly elected;and the approval of the Constitution was put tothe vote.

The ratification of the political project pro-posed by Government of the Citizens’Revolution, by means of constitutional reform,is what gives legitimacy to the major reformsneeded in order to transform the society’s eco-nomic model. The founding idea on which theproject is based, gives way to a new way of visu-alizing the coexistence between economic,political, social and environmental dimensionsof society. Each of the electoral opportunitieshas clearly demonstrated, through direct parti -cipation in the ballots, that there is mass supportfor the both for State’s proposal for structuraltransformation, and for the conception of a newmodel for development.

Furthermore, for the first time in thirty years,the territorial distribution of votes did notreflect the country’s historic regional divisions(Coast/Sierra, Quito/Guayaquil.) The optionof change won even in the city of Guayaquil– where the right-wing PSC has controlled alllocal power networks for the last 15 years – andthroughout almost the entire the national terri-tory (Map 4.1.)

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31 Between 2008 and 2025 the percentage of EAP will rise from 6.3 million to 9.1 million individuals.


As shown on the map, the project of the Citizens’Revolution has sound nationwide support and,hence, has managed to break the backbone ofthe political domination held by the traditionalpower blocks in Ecuador over the last two and ahalf decades. The legitimacy of the presidentialleadership and the citizens’ increased skepti-cism towards traditional political party struc-tures has markedly changed the correlation offorces. The oligarchic groups and the powerfuleconomic sectors have lost most of the graspthat they once held on State institutions.Democracy can only be affirmed when econo -mic power is clearly separated from politicalpower. Six consecutive and successful nationalelections in less than three years, through legaland legitimate processes, open the possibilitiesfor disputing the de facto power. This couldperhaps be considered to be the main achieve-ment of the Citizens’ Revolution over the last31 months.

4.2.2. Post-Neoliberal PerspectivesThus, we are at the beginning of a new cycle forradical change that seeks new answers toEcuador’s structural problems. This new cyclelooks towards the construction of a new collec-tive identity founded in principles of sovereigntyand equality in order to ensure the Good Livingof the entire society.

The complex constellation of historical factorsthat have been analyzed throughout this textdo, indeed point towards the need for a seriousin the change policies needed to bring aboutdevelopment. Indeed, it may become evidentthat a crisis was necessary to create opportuni-ties that would engender a new agenda for deve-lopment, particularly in the South. It is clearthat the 21st century has provided hospitableconditions for the advance of neoliberalism,with power still concentrated in the hands of aruling transnational capitalist class that have a

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Map 4.1: Results of the 2009 Presidential Elections

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Source: Consejo Nacional Electoral.



direct control over the financial capital circuitsand the western global corporate sectors(Harvey, 2007).

Paradoxically, since the first signs of the currenteconomic meltdown, the national economies ofa number of countries, even in places where theneoliberal creed still seems solid, have turnedtheir eyes to State intervention as a way to sus-tain and reactivate credit, production, anddemand and, thus, save the financial system.

Even before the outbreak of the financial crisis,a number of Latin American countries hadalready moved towards a public agenda that wasseeking to dismantle neoliberal policies. As amatter of fact, at the beginning of the 21st cen-tury, new progressive political coalitions hadcome to power by capitalizing upon the popula-tion’s disenchantment with market-orientedpolicies. Uneven and fragmented moderniza-tion processes and low economic growthincreased poverty, reproduced inequalities, anddismantled the State’s universal social serviceprovisions. This receding state presence beganto manifest itself in social resentment and indi -fference towards political institutions. Hencethe victory of political coalitions seeking tostrengthen the role of the State in the provisionof social services is unsurprising. This tendencyis reflected in the electoral participation of largesectors of the popular and middle classes(Ramírez F.; 2006:30-44).

Re-launching public participation within theframework of a strong State, along with thereturn to a strong focus on more inclusivenotions of development, are signs that pointtowards the establishment of a post-neoliberalcycle in eco nomy. This turn is characterized bypolicies focused on the (re)distribution of wealth,the reconstruction of key institutions and Statecapacities to activate an unorthodox road todevelopment.

4.2.3. Meanings and Progress ofNew Public Action: theConstitution as the Horizon

In the 31 months that have elapsed sincePresident Correa took office, the State has

regained considerable significance. The domesticagenda has been focused on re-establishing theState’s capacities in the fields of developmentplanning, regulation, and control of the econo-my’s strategic sectors, as well as of the distribu-tion and (re)distribution of social wealth. In thesphere of foreign policy, a geopolitical strategyhas been advanced to promote different pro -cesses of regional integration and international,sovereign insertion into the global system.

Preparing and activating a new public agendahas however, generated intense political dis-putes with the traditional elites (including cor-porate sectors, banks, financial circles and themedia), and other prominent political partiesall of which are associated to the prevailinglibe ral ideas. Even different State agencies,public corporations and other sectors associatedwith the old order have challenged and openlyblocked the extensive expectations of changeendorsed by the new Government. The anti-systemic strategy and the anti-neoliberal ideo -logy promoted by Rafael Correa since thebeginning of his electoral campaign in 2006 hasconsistently placed him in a position that is dia-metrically opposed to the established power.

Supported on the grounds of sound popular su -pport and benefitted by the party system’s hugeweakness, Rafael Correa’s political movement,Alianza País (AP), and the Government strucka number of blows to the structure of power thathas characterized and underpinned the Stateand national development since the 1990’s.The regime’s political decisions thus positionhim outside of the hegemonic battle betweenthe two dominant political groups that havedisputed power since the return to democracyin 1979: the economic interests articulatedaround the Social Christian Party (PSC)which, at a given time, also comprised IzquierdaDemocrática (ID) and Democracia Popular(DP); and those represented by AbdaláBucaram, Álvaro Noboa, and Lucio Gutiérrez.

The Government has successfully confrontedthis broad power block. The State’s confiscationof almost 200 assets from the powerful IsaíasGroup (September 2008) and the collection ofthis group’s public debt reaffirmed the Citizens’

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Revolution’s defense of public interests and itsanti-oligarchic vocation. In this sense, an effec-tive rupture from the traditional matrix ofsocial power is evident.

It is in this scenario that the constitutional pro ject,ratified on September 28, 2008, emerged. The Lawis characterized by the following principles:

• The establishment of a social economybased on the principles of solidarity.

• The reconstitution and rationalization ofthe State.

• The decentralization of the State.• The recovery of public planning.• The strengthening and generation of

environment regulations.• A commitment to the rights of nature.• The acknowledgement of a plurinational

State.• The promotion of social participation

and citizen empowerment.• The construction of a constitutional State.• The expansion of rights.• The conception of a development model

that distances itself from traditionalneoliberal creed.

• The predominance of civil over militarypower.

• The expansion of universal suffrage toexpand the right of vote to the politicalcommunity by empowering youngstersover 16, Ecuadorians living abroad, for-eigners, imprisoned persons who areawaiting trial, policemen/women, andthe military.

The Constitution thus contains the demandsand interests that have emerged from popularstruggles against neoli beralism. The singularityof the ongoing political process has been char-acterized by new directions of change and polit-ical rupture with the “old order” that have nowacquired a constitutional statute. Thus, theclaims of a hugely diverse cross-section of soci-ety have been converted into the axes for long-term political change.

Besides the rejection of political parties and thedemand for increased social participation anddemocratization, this ideological field expressesmore demand for the State and less prevalenceof the market “in the road to development”(Chart 4.3).

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Chart 4.3: Citizens’ perceptions

of State and market in Ecuador: 1998 - 2007 (%)*

* The consulted source does not show data for every year.

Source: Latinobarómetro, 2007.


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Along with the political ideas detailed above isthe urgent need to re-launch the State as apivo tal actor in the regulation of the economyand in the reactivation of the productive sec-tors. Based on some of the ideas of BresserPereira (2007), this new approach could beginto recover give greater importance to the follo -wing factors:

a) the need to collectively build a nationalstrategy for productive investment, inno-vation, employment generation, andsocial inclusion;

b) the idea that, historically, investmentfinancing has essentially comprisednational capitals and domestic savings,and not, as the orthodox creed says,external savings and the transfer of capi-tals from rich countries;

c) the conviction that stability must notonly relate to prices, but also to competi-tive exchange rate and a moderate inte -rest rate so as to provide reasonableemployment levels and not be exclusi -vely dedicated to attracting capital;

d) the need to keep a certain fiscal balancethat largely differentiates it from thedevelopmentalist phase of the 1950/1980cycle in order to maintain the role ofState as the main instrument for nationaldevelopment (public deficit, however,will be used at given moments for strate-gic investment and to stimulate demand);

d) the premise that the macroeconomicsphere is hinged on public investmentand not primary surplus which is consi -dered to be “the only a way to concealpayment of interests to the annuitants”;and

f) the need to promote distributive and re-distributive policies with the doubleobjective of consolidating a rights-basedsociety and strengthening the internalmarket (Brasser Pereira, 2007).

In Ecuador, the new Government has takensome steps in this direction. The developmentmodel is articulated with the aim of re-esta -

blishing the (re)distribution of wealth and mar-ket regulation, and active efforts have beenmade to ensure public investment recovery inmaterial and financial infrastructure in strategicsectors of the national economy.32

The new government has expressed its implicitwill to regulate the economy’s private sectorsmore efficiently; to expand the State’s ability toadministrate and control the conditions set bymultilateral institutions, transnational corpora-tions, and financial capital; and to rebalancethe disproportionate (re)distribution of earningsbetween public and private spheres. Althoughthe process is still in its early stages, the first twoyears of government must be defined as a periodof political transition.

According to projections made by CEPAL,Ecuador was the fifth country with the highestgrowth rate (6.5%) in Latin America in 2008,with a growth rate in the non oil sector of 7.9%.In these two years of government, the Gini coe -fficient (the economic tool most commonlyused to measure inequality), dropped from0.511 to 0.483 between December 2006 andDecember 2008, i.e., by 0.03 points. Alsonotable is the gradual reduction in inequalitydemonstrated by the fact that the differencebetween the richest 10% and the poorest 10%of the population in Ecuador dropped from 28to 24.5 times between December 2006 andDecember 2008.

In this context of the international financialcrisis, the viability of this emerging constella-tion of post-neoliberal policies will largelydepend on the country’s correct insertion in theongoing regional integration processes. TheNational Government is actively participatingin the construction of this process. Besidesstrategic agreements for refining oil withVenezuela, commercial agreements with Chile,and potential cooperation for infrastructuralprojects with Brazil, Ecuador has also played akey role in the newly founded UNASUR andhas played an important part in the creationof the Banco del Sur. The country is also now

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32 During the 2001-2006 period public investment was 6.5% of the average annual, and in the 2007-2009 period it rea-ched 9.9% of the average annual GDP, i.e., 50% more than in the previous seven years.


formally part of the ALBA-TCP. Ecuador is alsoengaged in dialogue with other strategicallyinteresting countries and emerging global powers(India, China, Russia, Iran). Furthermore thecountry is no longer a member of the ICSID, oneof the most coercive instruments associa ted withthe domination imposed by global markets.

In the midst of the global crisis of capitalism,the National Government’s challenge consists

of maintaining its line of post-neoliberal poli-cies focused on the creation of a fair societydesigned to promote equal opportunities anddefend popular interests.

All the changes detailed here move towards along-term development strategy: “Towards aNew Way of Generating and RedistributingWealth for Good Living”, which is describedbelow.

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The new agreement for coexistence proposedby the Government of the Citizens’ Revolutionis an effort to give birth to a constitutionalState of rights and justice (which goes beyondthe État de droit), the plurinational and inter-cultural State, and the society of Good Living,set forth in the 2008 Constitution. The long-term strategy that will enable building a newway of generating, distributing and redistribu -ting wealth is outlined below.

5.1. A New Agreementfor Coexistence

A new Constitution implies generating a newsocial contract and a new agreement for coexis-tence among the individuals in the politicalcommunity. The contemporary lite rature onthe theory of justice states that every social con-tract is based on the idea that “the principles ofjustice are the principles that rational and freeindividuals concerned to further their owninterests would accept given an initial positionof equality” (Rawls, 1999: 11.) This implies thatthe parties to this social contract are not in asituation of domination or asymmetric depend-ence with each other; that they are independent,free, and equal.

Historically, this has not been so in Ecuador.Past constitutional principles have not favoredeverybody; on the contrary, they have beendeliberate expressions of exclusion. The newConstitution starts by recognizing the existence

of these processes and the gaps that still separateEcuadorians from one another. In this sense, itproposes to leave behind the principles of a utili -tarian liberal society (unable to put into practiceits professed liberal rights) in order to createmodern form of republican egalitarianism.

Anchored in socialist values that are based onegalitarian principles, the Constitution seesequality as a governing principle to buildanother society. This is based on the convictionthat any inequality, not resulting from responsi-ble and conscious action, is unjustifiable andinacceptable. The new Constitution grantsgreat importance to correcting social gapsthrough redistributive processes and givesrenewed importance to the old thesis of repu -blican property, whereby a community of smallproprietors constitutes a sound foundation forgood republican wellbeing.

The new Constitution proposes to build arepublican society that fosters the constructionof positive freedom, based on the absence ofdominance and the promotion of the flouri -shing of capabilities and potentiality of indivi -duals. For this purpose, it is essential thatindividuals should enjoy sufficient materialresources. Moreover, a responsible republicancitizenry must be encouraged so that it mayconstruct its own preferences autonomously.

This construction needs institutionalized spacesfor participation and deliberation in which eachcitizen may defend his or her own positions.

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5. Towards a New Way of Generating andRedistributing Wealth for Good Living


5.2. Accumulation and(Re)distribution forGood Living

It goes beyond saying that this new social con-tract is entirely incompatible with an econo -mic strategy based on the export of primarygoods and raw materials, which prevents thekind of economic democracy sought in theConstitution. A route map is therefore essen-tial if we are to generate and redistributewealth differently.

A new strategy of economic accumulation and(re)distribution is only one of many changesrequired to achieve Good Living. However, in asociety with high levels of unsatisfied basicneeds, it is essential to foster an economic alter-

native to the prevailing model of primary pro -duct export-led growth, which has so failedEcuador throughout history.

With the exception of certain short-lived phasesof Ecuador’s republican history, when the cons-truction of a national industry was envisaged,the wealth generated through the exports ofagricultural goods only benefitted small – gene -rally corporate and landowning – groups.Moreover, oil was never “replanted” to diversifyor industrialize the economy. More recently, theeconomy’s liberalization and dollarization dee -pened this pattern of wealth concentration inthe hands of a few who saw Ecuador’s demandfor industrialized products as a market niche tobe exploited. Importers have been the greatbeneficiaries of this strategy (Figure 5.1).

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Figure 5.1: Accumulation regimes, State models,

and main governments with national scope projects

Source: SENPLADES/ Undersecretary of Democratic Reform of the State, 2009.

Prepared by: SENPLADES, 2009.


5.3. A New Long-TermAccumulation and (Re)distribution Strategy

Setting aside the primary goods export-ledmodel, democratizing the access to the means ofproduction, creating the conditions for anincrease in productivity, and generating qualitywork for all, are not goals which can beachieved immediately. The success of theseobjectives depends on the implementation of amedium to long-term process, in which stepsare taking in a courageous, progressive andrational fashion.

Ecuador’s main comparative advantage is itsbiodiversity and, unquestionably, its main com-petitive advantage would be to acquire theknowledge of the best ways to make use of thisbiodiversity, through its conservation and bybuilding national industries related to bio- andnanotechnology. In this sense, the strategy mustbe oriented to building, in the medium- andlong-term, a society of “bio-knowledge” and ofcommunity-based eco-touristic services. Unlikethe orthodox vision of growth, this strategyincorporates information, science, technology

and innovation, to knowledge, as endogenousvariables in the productive system33.

It should be highlighted that Good Living’sfocus in the early phases of this medium- tolong-term strategy is the satisfaction of thepopu lation’s basic needs through the sustai -nable generation of wealth. While the era ofindivi dualism and self-interest defended anotion of growth and (re)distribution based onthe notion of trickle-down, Good Livingstresses solidarity, reciprocity and coopera-tion, and the concept of “distributing while pro-ducing” and “producing while re-distributing.” Asa result, a popular, social and solidarity-basedeconomy is the main tool to make (re)distri -bution and the process of wealth generationinseparable from one another.

The achievement of an endogenous and sus-tainable economy for the 2009-2030 periodmust rely, therefore, on mid-term planning. Theobjectives set for 16 to 20 years’ time should beachieved progressively, in a process articulatingfour main phases. Figure 5.2 resumes the fourphases contemplated in the strategy to coverbasic needs.

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33 We must recall that, according to estimates, “more than 90% of the biological diversity that subsists in the planet islocated in the tropical and subtropical regions of Africa, Asia, and South America”. To this we must add the ancestralIndian knowledge of yet undiscovered species and the otherwise “unknown” uses of many known plants. Among theworld’s species of plants, more than two thirds are native to peripheral and semi-peripheral countries. More than 7000medical compounds used by western medicine have derived from the knowledge of plants. Throughout the last century,communities have largely contributed to industrial agriculture, pharmaceutical and biotechnological industry (...)Pharmaceutical, food, and biotechnological multinationals have misappropriated the knowledge of our peoples withminimum or no repayment, and have processed these substances and patented processes and products that they laun-ched to the market (Boaventura de Sousa Santos, 2003:146.)


The first phase is the transition in terms of accu-mulation. Although dependence on primarygoods to sustain the economy will remain, (re)dis-tribution – which is the core of change duringthis period – will be intensified. A process ofselective imports substitution34, promotion ofthe touristic sector, and strategic public invest-

ment35 to foster systemic productivity, shouldlay the foundations of a national industry andsubstantial changes in the energy matrix36, bothconsidered wealth-generating engines. The pri-orities, in this first phase, are technologicaldisa ggregation and investment abroad to formhuman capabilities and cultivate the conditions

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Figure 5.2: Phases of the endogenous sustainable

strategy to satisfy basic needs

Source: SENPLADES, 2009.


34 For an effective substitution of imports, the main task will be to develop the following industries: petrochemical, bio -energy and biofuel; metal-mechanic industry; biomedicine, pharmaceuticals and generics; biochemistry; hardware andsoftware; and environmental services. In addition, priority is placed on value-added generating activities with impor-tant effects on employment generation and the satisfaction of basic needs (with emphasis in social housing), food,small-scale fishing, crafts, community tourism, textiles, and shoe confection.

35 One of the main challenges is to link the country’s necessary public investment to national savings.36 Production and consumption can be more environmentally-friendly if renewable energies and energy efficiency are

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for community-based ecotourism. Followingthis logic, the protection of intensive sources ofwork and employment, as well as initiativesderived from the social and solidarity-basedeconomy, will be considered a priority, togetherwith food sovereignty and, in general, the satis-faction of the basic needs.37

Part of the (re)distribution strategy is to keepsurplus from remaining in the hands of middle-men, which is why rethinking the service sectoris also a key factor during this period.

In the second phase, the new national industrybears a greater relative weight than the primarysector. As a result, the consolidation of an energysurplus is sought primarily through the produc-tion and consumption of clean and bio-energy.38

The wealth generation strategy is supported bycommunity-based ecotourism and the surplus isdistributed through the productive process itself,by strengthening a popular, social, and solidarity-based economy. Investment in research anddevelopment also is given high priority, througha virtuous tripartite alliance: universities, (publicor private) indus try, and public research insti-tutes or technological research centers. For thisreason, consolidating a system of higher educa-tion and research bent on achieving excellencewill be a priority. Income generation for thenational economy still depends on the responsi-ble and sustainable extraction of non-renewablenatural resources, such as hydrocarbons and,eventually, mining.

The third phase is based on a strategy for exportdiversification and substitution, in which a

national industry covering the domesticdemand and generating surplus for exportsplays an important role. Similarly, this strategyseeks to substitute exports with goods withhigher added value and stop depending exclu-sively on extractive processes. The nationalindustry’s relative weight in the economy willbe equal to the relative weight of primarygoods. Investment in science and technologymust foster productive innovation in aspectsrelated to the industries initially established tosubstitute imports.

In the fourth phase, the strategy’s objective is thelaunching of bio-services and their technologi-cal application. The relative size of these servi -ces – mainly knowledge services and touristicservices – is expected to be greater than the pri-mary sector. Knowledge services and theirapplications are related to the industries pro-moted in the first phase.

The objective, therefore, is for Ecuador’sstrategic and sovereign insertion in the worldto depend on the endogenous strategy of satis-fying basic domestic needs, and not the otherway around, as has been the case throughouthistory, and in particularly during the neoli -beral years during which Ecuador essentiallyrespon ded to exogenous and market-drivenstimuli.

It is important to stress that the above strategypresented here also seeks to deconstruct thecreation of two false disjunctives: a) conserva-tion “versus” satisfaction of needs; and b) effi-ciency “versus” distribution.

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37 We refer to these sectors in some detail in the description of the 2009-2013 strategies in the following section.38 For this purpose, investment in this sector must be consolidated in the first phase of the Strategy.


The probability of success the Governmentagenda and an endogenous strategy to satisfy basicneeds, will depend on the conscious and consis-tent actions implemented by the State today(2009 - 2013). Success will also depend on therelative power of the social-political coalitionsthat support or reject the Government’s objec-tives, and on the course of a set of institutio naland social structural conditions that willinevitably affect the outcome.

The viability of the first phase of the endogenousstrategy to satisfy basic needs, is conditioned bytwelve strategies which are also the starting pointfor the following three phases of its application.

6.1. Democratization of theMeans of Production,(Re)distribution of Wealth,and Diversification ofthe Forms of Propertyand Organization

In addition to it being a matter of social justice,it has been demonstrated that the countrieswith the best coefficients in productive assetdistribution, not only grow more, but also enjoya more balanced and democratic form ofgrowth, which enables them to build moreegali tarian societies.

The National Government has undertaken asustained process of democratization of the

means of production, with special emphasis onland, water and productive assets that have nosocial function. Fundamental changes will bepromoted in the industrial, craft and servicesectors, and in agrarian structures, in order topromote certain rural sectors, small fisheries,and peasant family agriculture. The latter willimply a process of productive diversification,the upholding and defense of ethnic and cultu -ral diversity, institutional development, theaccess to productive opportunities and assets,the participation of the citizens, and a sustai -nable use of natural resources. An essentialcomponent of this strategy will be radicalizing(re)distribution: democratizing access to credits,technology, technical assistance, etc. Additio -nally, the commercialization of agrarian pro -ducts will follow a model based on shortcommercial chains and producer-consumersyner gy. Equally, basic needs will be guaranteedthrough the universal provision of quality ser -vices in public education and health, housing,food, clothing, and through dignified produc-tive and reproductive work.

This strategy stresses the agrarian and cattleraising sectors, for which the effects of neolibe -ral policies have been particularly harmful.However, other productive spheres related tothe coverage of basic needs will also be encou -raged: the food industry, the constructionindustry, with emphasis on social housing andon basic sanity infrastructure, small-scale acti -vities (including fishing), the craft, textile andshoe industry, and community-based tourism.

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6.2. Transformation of theEconomy’s Model ofSpecialization Throughthe Selective Substitutionof Imports

In Ecuador, economic specialization based onresource extraction and the production of rawmaterials limits the possibilities of achievingGood Living, because it reproduces a pattern ofunequal accumulation and irrational exploita-tion that degrades the ecosystem. One of itsmain features is the absence of specialized andhighly qualified labor. These also goes hand inhand with low real wages and, as a conse-quence, has a negative impact on domesticdemand, since the majority of the populationhas low consumption capacities and is unable tosave up. With feeble domestic demand, theinternal market fails to develop and the produc-tive expansion continues to privilege the exter-nal sector. The country’s external dependenceand the economy’s vulnerability are contingenton foreign demand and international prices.Finally, this pattern of economic specializationis subject to scale-decreasing performanceswhereby increasing investments yield decrea -sing economic benefits.

Moreover, dollarization does not allow themanipulation of the exchange rate in order tocounteract the negative effects of a nationaleconomy subjected to the variations of rela-tive commercial exchange prices. This is whythe selective substitution of imports is essen-tial – not only as a medium– and long-termdevelopment policy, but also in order to reducethis monetary vulnerability and protect the sus-tainability of the current monetary model.

The alternative must be a specialization modelthat focuses on value-generating secondary andtertiary production to develop the internal mar-ket without overlooking foreign trade advantages.The new model must emphasize specialized laborin order to increase real wages in the economyand thereby increase domestic demand through arise in consumption and sa vings capacity. Withgrowing domestic demand, the internal marketmay develop which, in turn, reduces the coun-

try’s foreign dependence and the economy’s vul-nerability to external shocks. Finally, this newpattern of economic specialization allows forthe creation of clusters that strengthen produc-tive chains with a positive impact on producti -vity and economic performance.

The stagnation of Ecuador’s pattern of specia -lization is a result of the fact that the primaryand extractive export-led economic modeloffers higher short-term returns on investment.This traditional pattern of accumulation has alow cost structure and the country already hasthe basic infrastructure required to develop it.In contrast, the more endogenous economicmodel has a higher cost structure and the coun-try will need to acquire new infrastructure andcapacity to allow for its development. As aresult, the only way to change the current spe-cialization model is through State intervention,economic policies and the important publicinvestment that will establish the conditionsrequired in order for the secondary and tertiarysectors to be more appealing and profitablethan the primary sector.

A policy of substitution should apply to thefollo wing sectors: secondary and tertiary sec-tors; value generating sectors, infrastructuredeveloping sectors; and the strategic capacitiesfor the sectors in question; sectors which makeuse of qualified labor; sectors linked to thedevelopment of technology and to specializedhuman capacities. Additionally, substitutionpolicies must also achieve the following: theymust i) make intensive use of valued-addedlabor; ii) contribute to food sovereignty; iii) nothave over-detrimental environmental impact;iv) be linked to strategic sectors in the long term;and v) not base their productivity on natu ralcomparative advantages.

6.3. Increase of Real Productivityand Diversification of Exports,Exporters and Markets

Increasing real productivity, diversifying pro-duction and transforming exports and importsin the medium- and long-terms, facilitatesEcuador’s strategic, intelligent and sovereign

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insertion in the world. This strategy implies a newconcept of competitiveness, in which commer cialwars, excessive debt, pressure to keep wages low,and unemployment resulting from the rigidity oflabor mobility from non-qualified to specializedlabor, have no place.

Productivity must rise and reach satisfactory le -vels without resulting in the exploitation of indi-viduals or nature. Productivity must therefore beunderstood differently, as the greatest possibleproductive yield without affecting the impact onlabor and the environment negatively.

In Ecuador, the exportable production is cen-tered on the primary sector and traditionalproducts which depend on static comparativeadvantages, determined by an irrationalexploitation of the country’s natural resources.Moreover, this type of production is also essen-tially exported to a series of traditional, fixedexport destinations. This makes the exportablesupply more vulnerable, since there is no diver-sification of risks related to demand contractionin any given market. On the supply end,concen tration occurs in the context of a limi tedtype and number of producers and exporters,which hinders the rise of expansive productionchains. Deconcentration is therefore essential.

Both deconcentration and import substitutionare necessary if we are to change the economy’spattern of accumulation by transforming thevicious cycle of primary production, low humancapacities, decreasing performances, low wages,scarce domestic demand, external dependence;into a virtuous cycle of value-generating produc-tion, improved human capabilities, enhancedperformance, better wages, recovered domesticdemand, reduced external dependence, andincreased sovereignty.

6.4. Ecuador’s Strategic andSovereign Insertion in theWorld, and Latin AmericanIntegration

The concept of sovereignty that Ecuadorendorses connects integration – with and forthe peoples of the world – with the people’scapacity for self-determination in their publicdecisions, and in their political, terri torial,food, energy, economic, financial, commercialand cultural matters.

The main objective of Ecuadorian foreign poli-cy is to promote endogenous developmentthrough the reengineering of its internationalrelations, in a way that takes into considerationthe different international stakeholders in astrategic fashion.39

Ecuador’s sovereign international relations thusbecome a tool in the restructuring of the pa -ttern of capital accumulation, distribution and(re)distribution and fomenting of tertiary econo-my. In terms of foreign policy, this means esta -blishing, in the short, medium and long-term, anumber of strategic alliances, in alignment withour National Objectives, so as to strengthen analternative axis focused on the South, and turnthe page on the “letters of intention” and theconditions of the past.

The new international order we are pursuing isdemocratic and multipolar. It is world in whichthe peoples of the South are protagonists. Itsinstitutional architecture favors multilateralismand promotes novel processes of integrationand cooperation for development, as well asharmonious political dialogue. Latin Americanregionalism is the starting point for the promo-tion of such spaces. The Union of South

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American Nations (UNASUR), the BolivarianAlliance for the Peoples of the Americas(ALBA) and the Organization of LatinAmerican and Caribbean States (OELAC) areour priorities.

Ecuador also promotes the construction of aNew International Financial Architecture.Ecuador defends the need for the creation andconsolidation of multilateral institutions whichdo not exclude weaker partners in the decision-making processes. These institutions shouldalso focus on development policies whichemphasize the satisfaction of peoples’ basicneeds and which are aligned to national andterritorial priorities.

Ecuador also defends the establishment of apayment compensation mechanism coordina -ted by the region’s central banks with the aim ofreducing transaction costs for interregionalcommercial flows. This Sistema Único deCompensation Comercial Regional – SingleRegional Commercial Compensation System(SUCRE) is a regional mechanism for the stabi-lization and integration of financial markets. Itstands in stark contrast with the historicallyonerous policy of favoring financial intermedia-tion of the hegemonic economic power centers.The SUCRE will enable the integration of neweconomic and commercial stakeholders, becausethe dependence on the dollar or other currenciesas payment mechanisms – which favors the coun-tries that issue the currencies – will decrease.

Opening new market niches, with favorableconditions for Ecuador, will also generate exter-nal demand for a production that generatesqualified labor.

Additionally, subsidies, duties and safeguardsfor the selective substitution of imports, withinthe framework of international agreements,may also play an important role.

Another objective of economic policy is toreduce intermediation to the minimum, andexpand the universe of actors involved in inter-national trade, for them to become the newengines of the social and solidarity-based eco -nomy projected at the world level.

In order to produce goods and services of highadded value, it is vital that foreign earnings,such as foreign direct investment and non-reimbursable international cooperation (tech-nical assistance, financing, and donations),should be invested in science and technology.

Ecuador proclaims human mobility as a consti-tutional right and condemns all types of xeno-phobia, discrimination, and ill treatment of itsnationals abroad and of foreigners in Ecuador.Human mobility should, on the contrary, faci -litate the creation of spaces for political dia-logue and cooperation, for the development ofall peoples of the world.

6.5. The Transformation of HigherEducation and the Transfer ofKnowledge in Science,Technology and Innovation

Higher education and academic research mustbe conceived as public assets given that theirdevelopment inevitably benefits society as awhole. Ecuador is one of the Latin Americancountries with the smallest higher educationcoverage, which is why increasing its access is apriority. Access should be granted through apolicy of equal opportunities.

For this purpose, it is crucial that the social-eco-nomic level ceases to be an impedi ment toaccess to higher education. This may be donethrough scholarships, quotas or credits for edu-cation, in spite of the importance of meritocraticcriteria. One way of reconciling the meritocraticsystem with the logic of affirmative action is byimplementing leveling systems which allow forthe treatment of existing educational inequalitiesat lower educational levels.

Special emphasis must be given to the supply ofhigher – university and non-university – educa-tion. Diversity in the supply side should notencourage great disparities in terms of the qua -lity of the education and, thereby, reproducethe segmented logics of an unfair society.

Other forms of negative discrimination on thebasis of religion, culture, ethnicity, politics,

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gender, and sexual choice, must also beattacked, both in access to education and in theeducational process itself.

It is also essential, in order to guarantee quality,objectivity, impartiality and high educationalstandards, to evaluate and accredit higher edu-cation institutions, and their programs, trainingand tuition.

Similarly, it is crucial for individuals with highacademic standards and more investigative andteaching experience, to have access to an aca-demic and research-oriented career.

It is also clear that the research performed inuniversities must play a vital role in transfor -ming the current economic model based onexports of primary goods. Linking research pro-duced in universities to public research institu-tions is paramount for the purpose of creatingsynergies that contribute the added value tonational industries.

Another important concern is the transfer oftechnology and knowledge through interna-tional cooperation. This transfer should beaimed at the satisfaction of basic needs, and theconsolidation of the national industry. Foreigndirect investment must also be providedtogether with technology and knowledge,without any conditions or dependences, so thatit can be applied in endogenous development.

Since biodiversity is one of Ecuador’s maincomparative advantages, generating informa-tion from this natural wealth through researchand basic and applied sciences is also essential.For this purpose, having a germplasm, tissue,and DNA bank is fundamental. Similarly, theconstruction of the “biopolis” means investiga -ting everything related to production, transmi -ssion, and consumption of clean and efficientalternative energies.

Investing in human skills for individuals tostudy in specific areas, particularly if it is rela tedto the country’s development, should be made acornerstone of public policy, and encouragedthrough scholarships for postgraduate studies in

first-class universities. In addition, specific poli-cies must be issued to avoid the process of brain-drain and to take actions to repatriate highlyeducated Ecuadorians to Ecuador. As a result,the country should foster student mobility pro-grams, mainly at the postgraduate level, as wellas programs designed so that lecturers andresearchers can travel at the regional and inter-national level for the purpose of exchangingand acquiring knowledge exchange and inte-grating knowledge networks.

Finally, it corresponds to the State and to theGovernment to create the corresponding publicpolicies to avoid the deepening of the process ofprivatization and mercantilization of highereducation.

6.6. Connectivity andTelecommunications for theInformation and KnowledgeSociety

Achieving Good Living implicitly means tran-siting towards the Information and KnowledgeSociety, taking into consideration the use of theInformation and Communications Technologies(ICTs), as a way of increasing productivity, andas an instrument to generate equal opportuni-ties, foster citizen participation, promote inter-culturalism to value our diversity and strengthenour plurinational identity, and to expand theexercise of rights and promote justice in all itsdimensions.

Accordingly, the State’s actions in the comingyears must focus on three essential aspects: co -nnectivity, hardware supply and the use of ICTsto achieve the Revolution of Education.Emphasizing these aspects fosters positive exter-nalities which have an impact on governmentservices and dynamizes the productive apparatus.

The State must ensure that the infrastructurefor a good connectivity and telecommunica-tions network covers the entire national terri-tory so that ICTs are available to everyone.Providing hardware to the population alsocomplements connectivity and can be a crucial

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element for guaranteeing better levels of digitalliteracy. To this end, two key strategic actionsmust be considered: 1) facilitating the access tocomputers for all primary and secondary schoolstudents; and 2) providing rural parish boardsand schools with up-to-date technology inorder to circumvent digital isolation and maketechnology available to the communities.

Total connectivity and hardware are powerfultools. In the field of education, ICTs allow forlong-distance training and may reduce schooland educational desertion. ICTs can also meanimprovements in the quality of teaching as wellas allow a continuous process of teacher conti -nuous training.

A deep transformation of the system of highereducation is a priority. Only a profound restruc-turing of the education system can give Ecuadorthe professio nals and academics able to use,exploit, and pro duce the ICTs the country sobadly needs, and in a way which increases pro-ductivity.40

6.7. Change of Energy Matrix

Ecuador’s energy matrix is what one mightexpect of a country that is dedicated to theexports of primary products with low addedvalue and the imports of industrialized goods.In Ecuador, 96% of energy production, theequi valent of 90% of the total energy supply41,is concentrated in fossil fuels such as crude oiland natural gas, with renewable sources ofenergy (such as hydroelectricity and biomass)barely representing 4% of national energy pro-duction. In addition, more than 90% of energyimports – which amount to 10% of the totalenergy supply – correspond to oil derivatives

(LPG, diesel, high octane naphtha, etc.). Attimes, Ecuador also imports electricity fromneighboring countries and other non-energeticoil-derived and petrochemical products (lubri-cants, etc.)

The change of the energy matrix must thereforecomply with the following:

• To increase the share of renewable ener-gies. To this end, we must implementhydroelectric projects without delay and,additionally, and promote projects forthe use of other renewable energies:geothermal, biomass, wind and solarsources of energy.

• The imports of oil derivatives must bereduced to a minimum. This can beachieved through the building of theRefinery of the Pacific.

• Using crude oil as an input in this newrefinery will also allow Ecuador to shiftfrom its current role as a crude oil expor -ter to becoming an exporter of petro-chemical and oil derivatives, with greateradded value.

• Given that the transport sector is the mainconsumer of energy in Ecuador, it is essen-tial to make the sector much more efficientand less fossil-fuel intensive. Current pa -tterns of transportation have serious impli-cations in cities where they cause trafficjams and environmental pollution.

• One of the great challenges is to tacklethe dramatic energy loss that results fromenergy transformation. Losses of energythrough distribution can be effectivelyreduced by applying adequate technicalmeasures.

• Programs for energetic efficiency must fo -cus on the industrial and household sectors.

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40 For industries with high technological input but low rates of productivity, see Katz (2009: 13).41 The total energy supply amounts to the equivalent of 235 million barrels of oil.


The public sector must set an example inefficient and responsible energy con-sumption.

• Citizens must become aware of the needfor energy savings and sustainable con-sumption.

The 2009-2013 period is, from the point of viewof planning, by far the most important. It is du -ring this period that the foundations required toreorient the energy matrix towards a more effi-cient, effective and environmentally friendlysystem, have to be established. This periodinvolves studies, feasibility analysis, detailedengineering plans and financing strategies.

In the short term, the projects aimed at chan -ging the energy matrix that have already begunmust continue. A series of small-scale projectsthat also increase energy efficiency, such asenergy-saving bulbs, imports of energeticallyefficient electric appliances, etc., must also beimplemented quickly.

Finally, it is clear that integral sovereigntyincludes energy sovereignty as one of its maincomponents. This is why it is important to deve -lop productive capacities that enable us to beenergetically self-sufficient, particularly in termsof the generation of electricity.

6.8. Investment for Good Livingwithin SustainableMacroeconomics

The objective of this strategy is to build threefundamentals pillars for Good Living. The first iseconomic sustainability which can be achievedby channeling savings towards both public andprivate investment in production. The second isthe development of the human capabilities andsocial opportunities that enable a more equitableeconomic organization and a fairer social coexis-tence. The third is the accumulation of the pro-ductive capital required to change the economy’spattern of specialization and accumulation.

Following the political program of the Citizens’Revolution and the new Constitution, publicinvestment shall grow as an instrumental variableof State intervention. Public spending will bedefined in view of achieving Good Living.Fiscal goals and debt are variables that mustguarantee macroeconomic sustainability.

The first pillar mentioned above, requires aradi cal social security reform, which, in turn,will allow for the channeling of the social secu-rity surplus for the safe and profitable promo-tion of production and would strengthen thesustainability of social security in the long run.A safe and productive use of internal savingscan be achieved by placing the profits derivedfrom non-renewable resources in productiveinvestments with high social and economicreturns. These policies will allow a savings-pro-ductive investment balance that reduces specu-lative practices and capital flight. In turn, thiswill foster a macroeconomic equilibrium withthe generation of employment.

The second pillar will be achieved, first of all,through investment directed at the supply ofessen tial goods and services, with the aim of im -proving and safeguarding the capacities of soci-ety as a whole: investment in nutrition, primaryhealthcare, basic education, etc. Another stra -tegy is to create the necessary access conditionsto potentiate social and individual capacities inpractice; investments aimed to work genera-tion, access to credit are among other examplesof this condition.

The third pillar is related to the need to accu-mulate capital in the value-generating produc-tive sectors. The investments that allow thistype of accumulation can be divided in twocate gories: infrastructure for systemic producti -vity (electric generation, telecommunications,petrochemical industry, software, electronics/hardware, research and development, etc.); andspecialization in installation capacity (researchin science and technology, specialized indus trialtraining, transfer of technology, etc.)

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6.9. Inclusion, SocialProtection and Security,and Guarantee of Rightswithin the Frameworkof the Constitution

Security mechanisms have been essential com-ponents in the development of all societies.These mechanisms have enabled the reproduc-tion of life throughout history and have becomea universal demand of people who have asser tedtheir right to secure a dignified existence.

A number of dominant actors of economicaccumulation have weakened and practicallydestroyed many security mechanisms. This hasresulted in high levels of insecurity.

The State has not compensated this situation.Rather, it has further encouraged this concen-trated and exclusive accumulation which hasrecreated, in a number of different ways, astrong “insecurity” for individuals and commu-nities, many of which banked on linking theirwellbeing and security to the performance ofglobalized accumulation42 (Peemans, 2002.)

6.9.1. Mechanisms for Inclusion,Social Protection, andGuarantee of Rights inLight of the New Agreementfor Coexistence to StrengthenSocial and Economic Capacities

Social protection and security are rights thatrequire inclusion, social participation and, acritical agreement to establish a society of

equals. This does not mean homogenizing waysof living and thinking, but giving rise to aninclusive institutional framework that guaran-tees the same opportunities for each individualto enjoy the benefits of collective existence,and to have a say in the decisions on how toachieve these objectives.43

We have established that the material bases forfreedom and citizenship are related to the dyna -mics of the distribution of production and notonly to the fruits of growth. Similarly, accumula -ting wealth cannot be disaggregated from havingrights. The following seeks to achieve this:

• The strengthening of a solidarity-based“territorialized social economy”.44 Specialattention will be paid to ventures thatintegrate their productive objectives tothe access to basic servi ces, food, health,quality education, quality social housing;and to tourism, based on cultu ral andecological diversity.

• The acknowledgement and social retri-bution of reproductive work, immate riallabor, and the different forms of self-production, are vital if we are to trans-form the social organization of work(Coraggio, 2008.) As a result, dignifiedwages and the possibility of exercisingthe right to free association are essen-tial. But, above all, social security mustbe amended to privilege its access toworkers who do not contribute to it:indivi duals involved in autonomouswork, non-compensated householdlabor, human care, immaterial labor,rural subsistence work.

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42 Policies of total or partial privatization of public services (health, education, energy, water distribution) in the name ofefficiency, means limiting access to the poorest sectors of population. Implementing policies of labor flexibilizationmakes the workers’ situation much more precarious. Recommending hands off fiscal policies alongside orthodox eco-nomic policies that generate inequality and social insecurity is evidently irresponsible.

43 CEPAL (2006) “Protección de cara al futuro, financiamiento y solidaridad”, Montevideo, Uruguay.44 In this sense, Coraggio proposes the following: “we want a society with a market rather than a market society. This

means that the para digm of an efficient company and a self-regulated market cannot guide our social-economic practi-ces. We have already seen that development strictly guided by market principles, particularly when there are global for-ces operating, generates unequal development, excludes people from society, makes human life vulnerable,commercializes politics, disintegrates local communities and societies, and produces planet-wide ecological disasters.Our sole objective cannot be to only integrate to this world those who are now excluded” (Coraggio: 2008.)


• The implementation of universal socialpolicies, not merely addressed to thepoorest sectors of the population, but forthe purpose of guaranteeing rights andGood Living to everybody must be amain concern. This permits:- the development of social protection

mechanisms, for example through theexpansion of the coverage of integralchildren’s development programs inpoor areas.

- the implementation of an educationalreform oriented to improve the quali-ty of public education;

- the satisfaction of basic sanity andsocial housing needs with connectivi-ty and a services, taking into accountcultural and geographic factors.

6.9.2. The Guarantee of Rights as aPriority of the Accumulationand (Re)distribution Strategyfor Good Living, within TheFramework of the Constitutionalorder and Justice

The Constitution is the best instrument for theguarantee of rights. It determines the contentsof the Law; it establishes the guarantees for itsexercise and limits the application of authorityand the structure of power; it is meant to bedirectly enforceable by any individual, authori-ty or judge. Constitutional rights are, at thesame time, limits on power and compulsorymandates for public authorities; they are theresult of historic claims, made before and abovethe State.

The word “guarantee” implies rights with a spe-cific and operational content, and assurancessociety undertakes to respect, in relation to pro-cedures, as well as institutional, legal and finan-cial frameworks for the exercise and fullenjoyment of rights.

As a consequence, we seek to foster mechanismsfor State intervention that comprise threedimensions: an ethical dimension based uponthe universal principles of human rights; a proce-dural dimension, a group of established mecha -nisms that facilitate dialogue between social

and political actors and translate each agreementreached in a normative instrument and, in theirturn, translating these instruments into policies;and a dimension of contents related to social pro-tection that guide specific actions in this field. Inthis sense, the challenges are the following:

• The development of constitutional gua -rantee mechanisms. The justice systemmust reformed, especially criminal andlabor laws, and the enforcement of cons -titutional justice must be expanded.

• The public sector must encourage commu -nication, information and training pro-grams in order to ensure the disse minationof knowledge on the exercise of rights.

• The judicial pluralism of the new Statemust be reinforced through the acknow -ledgement of the Indigenous communities’rules, procedures and dispute resolutions.

• The “guarantees approach”, from thepoint of view of social investment, con-stitutes a prioritizing element for Statespending. From the point of view of thecollective design of public policies, it is away of establishing a national consensus.

6.10.Sustainability, Conservation,Knowledge of the NaturalHeritage, and Promotion ofCommunity Tourism

From the perspective of the acknowledgementof the rights of nature, and reconciliation withmultiple cosmovisions, the critical question is:how to live well with social and environmentaljustice within the limits of nature?

The current political project proposes a transi-tion from the current extractivist, dependentand territorially disordered model, to a modelbased on moderate and sustainable use ofresources that takes into account spatial varia -bles intelligently, that assures food sovereigntyby taking in consideration population growth,that protects the environment and evaluatesthe risks of natural disaster by taking precau-tions and implementing mitigation measures;and that democratizes planning and decision-making among citizens.

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From this perspective, the first four yearsrequire the following measures:

• First, it is important to consider naturalheritage as a whole; it is crucial to con-serve and effectively and consistentlymanage natural spaces, particularly pro-tected areas, by evaluating their high le -vels of biodiversity, and by taking intoaccount human intervention, from thecommunity, private and public spheres,through a process of participation.

• Second, it is crucial to prevent and con-front the levels of land, water and atmos-pheric pollution, in urban, rural andmarine arenas. Supplying basic sanitationto all of the population is also paramount.

• Third, whereas it is important to incor-porate the notions of economic utility, itis also vital to include the concept of co-responsibility with regards to the humanimpact on the macro environment.Global warming is a good example ofthis. It is therefore essential for publicpolicies to mitigate environmental effectsand to respond to environmental degra-dation by proposing new alternatives,such as the Yasuní – ITT initiative.

• Fourth, it is vital that water, and access toit, be considered a right and an essentialaspect of the national heritage. The Stateand the population are obliged to protectwater’s natural cycle, as well as its qualityand quantity; to distribute it equitably, toprioritize human consumption; to use itresponsibly; and to guarantee its environ-mental quality.

• Fifth, the promotion of natural tourism,particularly community tourism, is analternative activity that enables makinguse of the natural landscape, generatingeducational and recreational opportuni-ties, as well as the distribution and(re)distribution of work and wealth.

6.11.Territorial Developmentand Organization,Deconcentration,and Decentralization

In some cases the term ‘territory’ refers to apolitical-administrative division; however itcan also include other meanings, such as hydro-graphic basins, economic spaces, or areas underthe influence of a people or nationality withspecific intercultural relations attached to it. Atthe same time, the term ‘region’ can be used indifferent ways: a geographically homogeneouscharacteristic; an area with a particular emphasison a given economic activity; an urban nucleus;an administrative area or a political constituency.In the case of Ecuador, we speak of three typesof regions: the geographic regions; the planningzones corresponding to the Executive’s internalcoordination; and the autonomous regions, alevel of government still under construction asper the provisions of the Constitution.

This strategy proposes mechanisms to transformEcuadorian territory, as well as to promote a(re)distribution of wealth among and betweenthe territories. It includes public policy guide-lines for the management of Ecuadorian territo-ries and planning for the coordination betweengovernment agencies to foment complementa -rity and synergy.

6.11.1.Promoting a polycentric,articulated, and complementarynational territorial structure

The territories must be conceived as spaces withspecific functions, articulated in a complemen-tary way to promote equal opportunities, ensurean equitable access to basic utilities, health,education, nutrition, dignified housing, andproductive resources. This means promotingthe association of different geographic spaces inthe country and encouraging the formation of

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regional systems structured in an overarchingnetwork in order to favor the country’s endoge-nous development. This means surpassing sim-ple concepts that advocate competition overcomplementarity.

The territorial approach is interwoven with thetwelve objectives for Good Living. It includespromoting and reinforcing a national polycentricstructure of human settlement that is articu lated

and complementary, and seeks to advance domes-tic integration, as well as to improve and rendermore efficient the country’s transport infrastruc-ture, connectivity and energy infrastructure.

A transversal element in the territorial strategyis the promotion of production, systemic pro-ductivity45, research, innovation, and scienceand technology, in accordance to each territo-ry’s capacities, vocation and potentialities.

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45 It is important to underline the significance of giving priority to work and wealth generation over accumulation.

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Figure 6.1: National Plan objectives mainstreaming with National Territorial Strategy




The analysis of the territories must include andcomplement social-network building mecha-nisms and the sense of belonging resulting fromhistoric and cultural processes at the roots of adiverse, plurinational and intercultural society.

In addition, the territorial perspective compri -ses both an internal and an external outlook: itprovides Ecuador with a strategic and sovereignvision of its insertion in the world and con-tributes to the consoli dation of a decentralizedand deconcentrated political model based onarticulated planning and participative territo -rial management.

6.11.2.Rural Good Living46

One of the central elements of the governmen-tal agenda for the coming years is Good Livingin rural territories. This means abandoning avision that focuses exclusively on the agrariandimension of the rural sphere, to a vision basedon an integral political economy of the ruralworld that takes into consideration the guaran-tee of rights, the links between agriculture, themanufacturing sector and services, and a diver-sity of work strategies and forms of incomegene ration of rural families.

Moving towards rural Good Living also requiresmobilizing the resources and assets of popula-tions (natural, physical, financial, human, socialand cultural), as well as promoting the democra-tization of the access to the means of production(water, land, capital, knowledge), and the con-ditions that enable correcting market flaws suchas the supply of infrastructure, education andhealth, without disregarding culture and inter-culturalism, science and techno logy, the reco -very of ancestral knowledge and wisdom, thepromotion of association, etc. Rural GoodLiving’s territorial approach does not excludesectorial policies for the agro-cattle-raising. Onthe contrary, it complements them by adoptinga broader more comprehensive perspective ofthe rural economy and society. Moreover, it is of

crucial importance that ethnic-cultural compo-sition of the rural population, as well as thefeminization of poverty, should be taken intoaccount.

The concept of rural Good Living also requiresa more flexible understanding of the ruralsphere, which must include disperse popula-tions but also small and medium towns andcities with economy and way of life closelyrelated to a rural existence, to natural resourcesand to agriculture.

Finally, the basic conditions for food sovereigntymust be generated from the rural territories.Food sovereignty implies recovering the role ofsociety in deciding what, how, where, and forwhom to produce, while emphasizing thestrengthening of small producers who, in thecase of Ecuador, cultivate the majority of foodincluded in the “basic subsistence basket”. Thefoodstuff produced must be sufficient, healthyand sustainable, and they must be commercia -lized through fair and equitable mechanisms.

6.11.3.ConsolidatingDevelopment planningand land use management

The National Territorial Strategy is the result ofa complex territorial planning process. In it, di -fferent planning instruments are proposed,including agendas for zonal development andplans for land use at each governmental level.

“Agendas” are instruments of public coordina-tion that identify the qualities and potentiali-ties of the different planning zones. Agendasterritorialize policies and public investment inorder to promote basic agreements for territo rialdevelopment. Agendas emphasize: productivedynamics; environmental management with aspecial focus on protected areas; the mana gementof hydrographic basins; public services to pro-mote rights, particularly those related to health,education, nutrition, housing; the identification

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46 See Chiriboga, Manuel (2008). Diseño de las políticas nacionales de desarrollo rural terri torial, MIES-PRODER, Quito.See also Hidalgo, Francisco (2009). Apuntes para la formulación de políticas públicas en materia de soberanía alimen-taria; and SENPLADES, (2009.) Estrategia para el Buen Vivir rural, Quito.


of investments in infrastructure that foster terri -torial integration and cohesion; and planningfor large-scale with a national impact.

According to the Constitution, all governmentlevels must formulate their own planning fordevelopment planning and land use; and article293 stipulates that the budgets of AutonomousDecentralized Governments will go hand-in-hand with local planning, and be compatiblewith the National Development Plan.Territorial planning also requires the generationof capacities for territorial analysis. Timely sta-tistics and mapping information must be pro-vided, and mechanisms of accountability,appropriation and participation of citizens mustbe institutionalized.

6.11.4.Decentralization,Deconcentration andReinforcing Managementand Coordination Capacitiesin the Territories

Decentralization and deconcentration aremechanisms for the (re)distribution of power andfor the democratization of society. Thesemecha nisms must be based on a new model ofState; a State that recovers its regulating, coor-dinating and redistributing capacities within aprocess of rationalization of public administra-tion with a clear division of competences.

The State must adopt a new territorial organiza-tional regime. It is vital that voluntaristic, “à lacarte” decentralization gives to a mandatory,progressive decentralization by the Consti -tution and the Law. Besides, the creation of anew intermediate level of government is anti -cipated: the region. The main function of theregion is to act as a planning pivot between thenational and local levels. Finally, AutonomousDecentralized Governments must be assignedadequately planned resources, to generate terri-torial equity, reward fiscal efforts and compli-ance with the goals of this Plan.

The State must be deconcentrated. In thisregard, the executive branch’s zones seek torationalize public service provision to avoidoverlap, administrative deficiencies or state

absence, which have been all-too— common ina context of ambiguity and lack of clarityregarding the competences of each governmentlevel. In this context, the challenge is to reducedeficits of institutional development in theterri tories, and to implement mechanisms forinter-institutional mechanisms between thecentral government (sectorial institutions) andits deconcentrated local representations.

Moving towards an effective decentralizationand deconcentration of the State also impliesfostering citizen participation and the genera-tion of spaces for the interaction of differentactors, so that they may be able to share visions,strategies and objectives, in order to democra-tize the relations between the State and societyat all levels of government.

6.12.Citizen power andsocial protagonism

While neoliberalism places the market at thecore of social regulation and so-called realsocialism privileged the State, the new demo-cratic socialism must be built on the basis of thecitizens’ needs and aspirations. It is thereforecrucial to give way a process of collective deli -berations, which sets the criteria for the framingof the production, circulation and distributionof social wealth, and generates the rules thatgovern the political community.

With the establishment of Citizen Power in the2008 Constitution, participation is construed aspart of the rights of citizens as well as a newprinciple for State action and public manage-ment at all levels of government. In this way,the constitutional framework establishes thebroad guidelines of the strategy to promote andencourage citizen participation.

Given that civil society’s dynamism largelydepends on autonomous initiatives undertaken bycitizens and social organizations, the State mustcreate the adequate institutional and materialconditions for such dynamics to effectively influ-ence the orientation of government processes.The deployment of citizen power requires a proac-tive role from the State in matters concerning:

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• The egalitarian distribution and (re)dis-tribution of social wealth: the capacities forparticipation and deliberation are largelyconditioned on access to quality health,education, culture, technology, informa-tion, etc;

• The transformation of the institutionalframework and public management pro-cedures for the purpose of securing amore democratic State, subject to perma-nent popular scrutiny;

• The promotion of the right of participa-tion, together with the training of civilsociety and adequate communicationprocesses that expand the competen cesand know-how that citizens and socialorganizations require in order to interactwith public institutions.

• In a context in which Ecuadorian civilsociety seems to have exhausted some ofits participative energies47, this proac-tive role of the State in promotingsocial participation is an inescapabletask. This must take place with unres -tricted observance to the principles ofcivil society’s pluralism, autonomy andself-determination. This depends, inturn, on clearly establishing the criteriaand conditions – spaces, procedures,contents, purposes – in which interac-tion between State and society takesplace. The Cons titution provides formultiple instances and mechanisms tochannel such interaction.

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47 Ecuador is a country in which a strikingly high rate of people (52 per cent) declares not having participated in any typeof political or social organization. The same is true with regards to participation in protests or “authorized demonstra-tions”: barely 5 per cent of Ecuadorians declare having taken part in this type of participative space – which is thelowest in the region. This percentage rises to 9 per cent when people are asked if they have “participated in any typeof protest in the last 5 years.” Regarding citizen participation in local governments – perhaps the most suitable scale onwhich to analyze citizen participation –, the trend remains the same: over the last 7 years, participation in local govern-ment dropped approximately 47 per cent: from 10.8 in 2001 to 5.7 per cent in 2008. (Latinobarómetro, 2008.)


In Ecuador, exclusion and marginalization havehistoric and cultural roots. In the last threedecades, these processes have been aggravatedand have emerged in a more complex form.These new forms of exclusion have been shapedby changes generated through globali zation, thematerialization of new productive and labororganization, the change in family models andunusual social situations resulting from the risein human mobility. The forms and conditions ofexclusion expressed in the social structure havekept specific individuals and groups from freelyexercising their right to citizenship.

The State has responded by implementingsocial protection mechanisms based on hand-outs or the application of palliative policiesalmost always limited and insufficient, withoutincorporating the plural and interculturalapproaches required by a diverse population.

The new model of Good Living implies anorganic distribution of the country’s wealth interms of infrastructure, goods and services, essen-tial to expand human capabilities and liber ties,and an efficient economic performance. Today,the State acknowledges and guarantees theindivisible nature of the Good Living’s systemof rights and, above all, vouches for its institu-tional and public concretion.

As a result, this objective propose to apply inte-gral policies that are capable of tackling the

complexity of exclusion and promoting newlogics for cohesion and (re)distribution, in recog-nition of diversity. This new model’s mecha-nisms for inclusion, social protection andterritorial integration, identifies and values allindividuals, particularly the groups in need ofpriority attention; and recognizes diversity incommunities, peoples and nationalities.

The exercise of rights, with emphasis on health,education, social security, nutrition, water, andhousing, means that all people are to be inclu -ded and integrated in the social dynamicsthrough the equitable access to material, socialand cultural goods. This means that the Stateneeds to put an end to economic inequalities,contribute to the democratization of the meansof production and give way to the Good Livingthat the society so desperately needs.

Policies1.1. To guarantee the rights of Good Living to

overcome all inequalities (particularly inhealth, education, nutrition, water andhousing.)

1.2. To foster the quality and efficiency of thepopulation’s social protection and socialsecurity throughout people’s lives, underprinciples of equality, justice, dignity, andinterculturalism.

1.3. To promote social and economic inclu-sion with a gender, intercultural, and

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7. National Objectives for Good Living

Objective 1:To Foster Social and Territorial Equality, Cohesion,and Integration with Diversity


intergenerational approach for the gene -ration of equal conditions.

1.4. To democratize the means of productionto generate equitable conditions andopportunities.

1.5. To ensure the equitable (re)distributionof wealth.

1.6. To recognize and respect social-culturaldiversity and eradicate all forms of dis-crimination, whether based on gender,sexual preference, ethnic, cultural, poli -tical, economic and religious factors, or onorigin, migration, geography, age, socio-economic background, disability, etc.

1.7. To protect and foster the rights ofEcuadorians living abroad and foreignersliving in Ecuador, and their families.

1.8. To foster rural Good Living.1.9. To promote integral, balanced, equitable

and sustainable territorial managementthat favors the formation of a nationalpolycentric structure.

1.10. To assure children’s integral developmentfor the full exercise of rights.

Goals1.1.1 To increase the percentage of households

established in a single house to 71% by2013.

1.1.2 To reach 98% of enrollment in basic edu-cation by 2013.

1.1.3 To increase teenage enrollment in highschool to 66.5% by 2013.

1.1.4 To increase to 8, the grading of the “lifesatisfaction” of the population by 2013.

1.1.5 To revert economic inequality at least tothe 1995 level by 2013.

1.2.1 To give social security coverage to 40% ofthe population by 2013.

1.3.1 To give 40% of disabled people a fulloccupation by 2013.

1.4.1 To reduce land concentration levels by22% by 2013.

1.4.2 To reduce the concentration of access tocredit in 10% by 2013.

1.5.1 To increase tax collection by 15% by2013.

1.5.2 To achieve that 50% of all taxes aredirect taxes by 2013.

1.5.3 To increase the recollection of the VATpaid by individuals and income tax col-lection by 10% by 2013.

1.5.4 To increase the redistributive effect ofthe VAT paid by individuals and incometax by 10% by 2013.

1.8.1 To double the participation of peasantfamily agriculture in agricultural exportsby 2013.

1.8.2 To reduce intermediation by 20% by2013.

1.10.1 To extend child development services to75% of all children by 2013.

1.10.2 To reduce by 25% the percentage of chil-dren who work and do not study by 2013.

1.10.3 To increase the average duration ofexclusive maternal lactation to 4 monthsby 2013.

1.10.4 To eradicate childhood mendicancy by2013.

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Objective 2:To Improve the Citizens’ Capabilities and Potentialities

Developing citizens’ capabilities and potentiali-ties demands harmonious and integral actions.Adequate and timely healthcare guaranteesvital energy; quality education favors the acqui-sition of knowledge for life and favors indivi -dual and social achievements; culture definesthe system of beliefs and values that compose

collective identities; and sports are an impor-tant support for socialization.

The accumulation of vital energy demands apreventive vision of healthcare in which a basicelement is adequate nutrition, in parti cular du -ring pregnancy and the first five years of child’s


development. Physical activities and sports areelements that dynamize capabilities and poten-tialities and contribute to integral physical andpsychological health.

Education is crucial to reinforce and diversifyindividual and social capabilities and potentia -lities, and to foster participative and critical citi -zens. Education remains one of the best ways ofconsolidating a democratic society that con-tributes to the eradication of economic, politi-cal, social and cultural inequalities.

From a strategic perspective, it is essential todevelop various forms of knowledge with highadded value, as well as technical and technolo -gical research and innovation. The combina-tion of ancestral forms of knowledge withstate-of-the-art technology can reverse the cu -rrent development model and contribute to thetransition towards a model of accumulationbased on bio-knowledge. In the medium term,local and exportable production is expected tobe based on science, technology and innova-tion, as well as biodiversity.

In the rural sphere, knowledge and access tonew communication and information technolo-gies plays a key role in the reduction of transac-tion costs. Education is key for the reduction ofthe digital gap that so deepens inequalities.Higher education is also a powerful tool for thepromotion of individual capabilities, especiallywhen it allows for the development of “positiveliberties”, and when it accompanies a process ofincreased focus on scientific research and tech-nological development so as to reverse the cu -rrent model of development.

Policies2.1. To assure healthy, nutritious and natural

foods made with local products in order todrastically reduce nutritional deficiencies.

2.2. To progressively improve the quality ofeducation with a rights, gender and inter-cultural approach, and the promotion ofinclusion to reinforce union in diversityand foster an education system whichallows for the completion of studies.

2.3. To reinforce intercultural bilingual edu-cation and the deepening of the intercul-tural character of education.

2.4. To generate a continuous training andformation process for all stages of life,with an emphasis on promoting gender,generational and intercultural equalityand opportunity, in arti culation with theobjectives of Good Living.

2.5. To reinforce higher education within ascientific and humanist vision articulatedto the objectives of Good Living.

2.6. To promote scientific research andknowledge, the revaluation of ancestralknowledge and wisdom, and technologi-cal innovation.

2.7. To foster the access to information andnew information and communicationtechnology, in order to allow people to bea part of the “society of information” andstrengthen citizenship.

2.8. To promote sports and physical activitiesin order to reinforce the population’scapabilities and potentialities.

Goals2.1.1 To reduce chronic malnutrition by 45%

by 2013.2.1.2 To guarantee a minimum daily consump-

tion of 260 Kcal/day by 2013.2.1.3 To reduce the percentage of children

born underweight to 3.9% by 2013.2.2.1 To ensure that at least 30% of students in

6th and 9th grades obtain the mark “Good”and not less than 8% “Very Good” in thesocial sciences by 2013.

2.2.2 To ensure that at least 20% of students in3rd, 6th, 9th, and 12p grades obtain themark “Good” and not less than 8% “VeryGood” in Mathematics by 2013.

2.2.3 To ensure that at least 15% of the stu-dents of 3rd, 6th, 9th, and 12th grades obtainthe mark “Very Good” in Language by2013.

2.2.4 To ensure that at least 10% of the stu-dents of 6th and 9th grades obtain the mark“Very Good” in the Natural Sciences by2013.

2.2.5 To ensure that at least 46% of the teach-ers obtain the mark “Very Good” in theInternal Evaluation by 2013.

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2.2.6 To ensure that at least 60% of teachersobtain the mark “Good” in the internalevaluation on specific knowledge.

2.2.7 To reduce functional illiteracy to 10% by2013.

2.5.1 To increase the number of investigatorsdevoted to I+D+i to 969 by 2013.

2.5.2 To reach the Latin American average inthe rates of higher education registrationby 2013.

2.5.3 To reach at least 1500 postgraduatescholarships by 2013.

2.6.1 To increase by 75% the articles publishedin indexed scholarly magazines by 2013.

2.6.2 To ensure spending in I+D+I reaches atleast 0.44% of GDP by 2013.

2.7.1 To ensure that 55% of all rural educa-tional establishments and 100% of allurban educations establishments haveaccess to Internet by 2013.

2.7.2 To multiply by three the percentage ofhomes with access to Internet by 2013.

2.7.3 To ensure that 50% of all homes haveaccess to telephone landlines by 2013.

2.8.1 To send 45 participants to the OlympicGames in 2012.

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Objective 3:To Improve the Quality of Life of the Population

Quality of life is an essential aspect of GoodLiving, since it relates to creating the necessaryconditions to satisfy the material, psychologi-cal, social and ecological needs of individuals.

This concept integrates factors that link indi-vidual and collective wellbeing, happiness andsatisfaction, interpersonal solidarity, and sus-tainable social and economic relations respect-ful of individuals and nature, in the context ofthe cultures and value systems in which indi-viduals live, and in relation to their expecta-tions and demands.

This objective proposes that public policiesshould be conceived within an inter-sectorialand rights approach and should be appliedthrough protection mechanisms and the provi-sion of integral and integrated services. In thesemechanisms, social, economic, environmentaland cultural factors are articulated with empha-sis on the groups, the peoples and nationalitiesin need of priority attention.

The improvement of the quality of life is amulti dimensional and complex process deter-mined by decisive aspects related to the qualityof the environment, the right to health, educa-tion, food, housing, recreation and sports, socialand political participation, work, social security,and personal relations. The conditions of the

surroundings where work, study and rest andrelaxation take place, as well as the quality ofpublic services and institutions, bear a directinfluence on the quality of life, understood as afair and equitable (re)distribution of social wealth.

Policies3.1. To foster the healthy life of the popula-

tion and the practices which foment it.3.2. To strengthen the prevention and con-

trol of disease, and to promote the capa -city to explain, prevent and control deathrates.

3.3. To guarantee timely, quality, warm andequitable integral healthcare at no costfor the users.

3.4. To provide integral care to women andpriority attention groups, with an approachwhich emphasizes gender, age, fami ly,community and interculturalism.

3.5. To recognize, respect and promote ances-tral and alternative medical practices, aswell as the use of ancestral medicalknowledge.

3.6. To guarantee dignified, safe, healthy,equitable, sustainable and efficienthousing.

3.7. To create the conditions for human safe-ty and mutual trust for people in living indifferent surroundings.


Goals3.1.1 To multiply by three the percentage of the

population which does physical exercisemore than 3.5 hours per week by 2013.

3.1.2 To reduce obesity in schools to 5% by2013.

3.2.1 To reduce the incidence of malaria by40% by 2013.

3.2.2 To decrease to 4 the mortality rate ofhemorrhagic dengue fever by 2013.

3.2.3 To reduce the AIDS mortality rate by25% by 2013.

3.2.4 To reduce the mortality rate of tuberculo-sis to 2 per 100.000 by 2013.

3.2.5 To reduce the mortality rate derived fromdiseases caused by the poor quality ofwater to a third by 2013.

3.2.6 To reduce pneumonia or and reduce itsmortality rate by 18% by 2013.

3.3.1 To ensure that public institutions cover70% of births by 2013.

3.3.2 To increase to 7 the performance qualifi-cation of public health services by 2013.

3.4.1 To reduce teenage pregnancy by 25% by2013.

3.4.2 To reduce maternal mortality by 35% by2013.

3.4.3 To reduce early neonatal mortality by35% by 2013.

3.6.1 To reduce the percentage of overcrowdedhomes by 33% by 2013.

3.6.2 To grant access to sanitation services to80% of homes by 2013.

3.6.3 To decrease to 35% the percentage ofhouseholds which rely on physicallyinadequate housing by 2013.

3.6.4 To decrease to 60% the percentage ofhouseholds with qualitative housingdeficit by 2013.

3.7.1 To revert the trend of rising criminality,and reach 23% by 2013.

3.7.2 To increase to 7 the users’ assessments ofthe quality of the service of the NationalPolice by 2013.

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Objective 4:To Guarantee the Rights of Nature and Promotea Healthy and Sustainable Environment

Nature has too often been perceived as a set ofresources, subject to human exploitation andappraised from a strictly economic standpoint.The Fundamental Law implied a radical shiftand included the concept of the guarantee ofthe rights of nature.48

The State, in its commitment to the popula-tion’s Good Living, must assume its responsibi -lities towards nature. Similarly, the notion ofsocial co-responsibility requires that indivi duals,communities, peoples and nationalities, the pri-vate sector, social communities and the popula-tion at large, take care and protect nature.

Water and biodiversity must be treated as a stra -tegic legacy, which, in turn gives rise to a num-

ber of challenges; achieving significant changesin the institutions that conduct environmentpolicies, regulations and control is one suchchallenge. This also means fostering effectivedeconcentration in the territories, in articula-tion with the new State structure, under theprinciple of the recognition of population, cul-tural and environmental diversity, and alwaysbearing in mind that Ecuador is part of theworld community.

To this end, it is essential that the proposedchanges come with effective transformations inthe patterns of production and consumption, inorder to prevent, control and mitigate environ-mental damage and strategically confront glo -bal warming.


Policies4.1. To preserve and sustainably manage the

natural heritage, land-based and marinebiodiversity, which must be regarded asstrategic sec tors.

4.2. To promote an integral approach to thetreatment of Ecuador’s hydrographic rea -lity, including the State’s strategic use ofhydrographic basins, always bearing inmind their socio-cultural and environ-mental value.

4.3. To diversify the national energy matrixby promoting an efficient and greaterparticipation of sustainable sources ofrenewal energies.

4.4. To prevent, control and mitigate environ -mental damage as a crucial contributionto the improvement of the quality of life.

4.5. To promote the adaptation to – and miti -gation of – the variability of weather andclimate with an emphasis on the processof climate change.

4.6. To reduce social and environmental vul-nerability produced by natural andanthropic processes.

4.7. To incorporate an environmental approachin all social, economic and culturalpublic policies.

Goals4.1.1 To increase by 5% the total area under a

regime of environmental conservation by2013.

4.1.2 To include 2,521 square kilometers ofmarine-continental coastline under an

environmental conservation regime by2013.

4.1.3 To reduce the rate of deforestation by30% by 2013.

4.2.1 To reduce the presence of mercury inmining activities to 0.0001 mg/l by 2013.

4.3.1 To increase the installed energy capacityto 1.091 Megawatts by 2013 and anadded 487 megawatts by 2014.

4.3.2 To decrease the ecological footprint so itdoes not exceed Ecuador’s bio-capacityby 2013.

4.3.3 To raise the share of alternative energy inthe total installed energy capacity by 6%by 2013.

4.3.4 To ensure that 97% of households haveaccess to electricity by 2013.

4.3.5 To ensure that 98% of urban householdhave access to electricity by 2013.

4.3.6 To ensure that 96% of rural householdshave access to electricity by 2013.

4.4.1 To keep the average annual concentra-tion of air pollution below permittedstandards by 2013.

4.4.2 To remediate 60% of environmental lia-bilities by 2013.

4.4.3 To reduce the amount of PBC by 40% by2013.

4.4.4 To reduce the amount of pesticides(POPS) by 60% by 2013.

4.5.1 To reduce to 23% the “high” level ofthreat of eco-systemic vulnerability toclimatic change; and to 69% the “aver-age” level of level, by 2013.

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Objective 5:To Guarantee Sovereignty and Peace; to Promote Ecuador’sStrategic Insertion in the World, and Latin American Integration

Sovereignty lies with the people; and their collec -tive will is the basis of authority. The exercise ofsovereignty is performed through public entitiesand institutions and through the direct partici-pation of citizens established in the Funda -mental Law. One of the main duties of the Stateis to guarantee national sovereignty.

Sovereignty relies on territorial and legalintegrity. But the 2008 Constitution exceedsthis traditional concept to give it political, terri -torial, nutritional, economic and cultural impli-cations and significance. As a result, guaran teeingsovereignty implies maintaining and defendingthe State’s political self-determination and


independence, both at the domestic and at theinternational level.

This new vision of sovereignty recognizesdiverse forms of organization in society, aimedat developing process of self-determination andinfluencing public decisions and policies. It alsorejects the traditional and homoge nizing notionof the “mestizo” nation and emphasizes theneed to recognize the diversity of the peoplesand nationalities.

The National Government also seeks to strate-gically insert Ecuador in the international sys-tem, following the ideal of the peoples’sovereign integration. This integration requiresmutual respect between States; the acknow -ledgement of the diversity of the differenthuman groups that share global territory; andthe protection and inclusion of fellow citizensbeyond the borders.

The State rejects international relations of sub-mission and heralds Ecuador as a territory ofpeace. Special emphasis is placed on not allo -wing sovereignty to be violated. Foreign policyalso shifts its focus and gives due importance toSouth-South relations; foreign policy should pro-mote dialogue and the construction of symme tricrelations among equals to facilitate an endoge-nous economy for Good Living.

Food sovereignty implies a substantial changeaway from a historic condition of dependenceand vulnerability in relation to production andconsumption. Energy sovereignty, on the otherhand, cannot be achieved to the detriment offood sovereignty, nor can it affect the popula-tion’s right to access to water.

There is also a clear need to recover the State’seconomic and financial instruments to reversethe current patterns of foreign debt and aligninternational cooperation and foreign invest-ment to the National Objectives of develop-ment. Recovering the sovereignty of theradio-electric spectrum in order to promotesovereign cul tural production with contentcompatible with the new plurinational andintercultural State, is also essential.

Policies5.1. To exercise sovereignty and to foster the

peaceful coexistence of people in a cul-ture of peace.

5.2. To defend territorial integrity and theState’s sovereign rights.

5.3. To reduce the vulnerability caused bydependence on external sources of foodand energy.

5.4. To foster political dialogue and sovereignnegotiations in international coopera-tion and economic relations.

5.5. To promote our integration with LatinAmerica and the Caribbean.

5.6. To promote sovereign, strategic and com-plementary foreign relations with a frame -work of mutual solidarity.

5.7. To combat organized transnational crimein all its expressions.

Goals5.1.1 To reduce poverty (unsatisfied basic needs)

on the Northern border by 25% in urbanareas, and by 50% in rural areas by 2013.

5.1.2 To reduce poverty (unsatisfied basic needs)on the Southern border by 20% in urbanareas, and by 50% in rural areas by 2013.

5.1.3 To reduce poverty (unsatisfied basic needs)on the Central border by 25% in urbanareas, and by 50% in rural areas by 2013.

5.1.4 To have no conflicts with either regularor irregular armed forces that affectsnational sovereignty or threatens theState, by 2013.

5.2.1 To half the inadequate use of householdliquefied petroleum gas (LPG) by 2013.

5.3.1 To substitute imports of corn, soya paste,wheat and barley, and reduce foreign par-ticipation in domestic consumption to40% by 2013.

5.4.1 To arrive at 60% of the cooperation flowsincluded in the national budget, by 2013.

5.5.1 To increase the Latin American integra-tion index to 0.4 by 2013.

5.6.1 To increase to 0.95 the relationshipbetween industrial exports and non-oilprimary exports by 2013.

5.6.2 To reduce to 0.65 the concentration ofexports per destination by 2013.

5.6.3 To decrease by 13% the concentration ofimports per country of origin by 2013.

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Work is the backbone of society and is of funda-mental importance in the lives of individualsand families. The 2008 Constitution recognizeswork as a right and as a social duty; and in eco-nomic law it is deemed the source of personalself-fulfillment and the basis of economy.

In modern history, labor exploitation has con-solidated a form of accumulation that does notfavor the interest of workers. Work has beenconceived as an exploitable and dispensablemeans, subject to dynamics that are alien to theintrinsic purpose of the process of productionand to the family and social cycle.

The new Constitution proclaims respect for thedignity of working people by demanding the fullexercise of worker’s rights. This means fair com-pensation and reward, as well as a healthy workenvironment and stability of labor, in particu-lar, in order to correct the asymmetry in wor -kers’ conditions throughout the country.

In Ecuador, the labor structure, with regards tothe organization of production, is highly hetero -geneous. Both in urban and rural spheres, mostprocesses of production and service provisionare based on small, family, associative or indi-vidual units, with popular, family dynamics, andworkers looking at supporting themselves ratherthan aspiring to large-scale accumulation.These productive processes are also based onresources such as knowledge, skills, local sa -vings, social networks, etc. By and large, how-ever, this type of economic activity hasperformed in adverse conditions due to a lack ofrecognition from the State.

This Plan for Good Living recognizes and supportsdifferent forms of production organizations:community, cooperative, public, private, corpo-rate, associative, family or household-based,autonomous, and mixed; as well as the differentforms of work – including autonomous, subsis-tence or based on care for others – and familyand neighborhood forms of reproduction andsurvival.

Social cooperation, which is characteristic ofthe subsistence and care economies, is an essen-tial element to build a social economy based onsolidarity and on a more equitable society.Associative productive forms, therefore, mustbe replicated in all sectors of the economy togenerate better conditions for the individualswho participate in them.

Policies6.1. To consider all forms of work, to generate

dignified work conditions, and to ensurecompliance with labor rights.

6.2. To foster the acknowledgement ofautonomous work, human and familycaring activities, subsistence activities, aswell as the integral transformation of theconditions of workers.

6.3. To foster associations as the basis toimprove work conditions and to generatenew employment.

6.4. To promote fair wages, reward and com-pensation with no discrimination, and toreduce the gap between the cost of the“basic consumer basket” and the basicwage.

6.5. To foster economic activities aimed atmaintaining employment and to promotethe generation of new jobs, as well as theprogressive reduction of underemploy-ment and unemployment.

6.6. To promote safe, healthy, inclusive, non-discriminatory and environmentally-friendly work conditions and surroundings.

6.7. To foster training and education proce -sses in the context of work.

6.8. To create the conditions for the absorp-tion into labor and the productiveprocesses of the migrant populationreturning to Ecuador, and to protectmigrant workers.

Goals6.2.1 To aim for a ratio of 1 in the equality of

hours devoted to reproductive work by2013.

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Objective 6:To Guarantee Stable, Fair and Dignified Work in its Diverse Forms


6.3.1 To increase the number of foreign visitorsto 1.57 million by 2013.

6.3.2 To double the percentage of people withan active participation in production,trade or agriculture associations by 2013.

6.4.1 To decrease the percentage of individualswho receive wages inferior to the mini-mum vital wage by 27% by 2013.

6.5.1 To decrease national gross underemploy-ment by 10 points by 2013.

6.5.2 To reverse the growing trend of youthunemployment and reduce it by 24% by2013.

6.5.3 To increase the access to higher educa-tion of population quintiles 1 and 2 by40% by 2013.

6.7.1 To increase the average work productivi-ty in the industrial sector by 25% by 2013.

6.7.2 To multiply by 4 the percentage of theeconomically active population receivingprofessional public training by 2013.

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Objective 7:To Build and Strengthen Public and Intercultural Spacesfor Social Interactions

The construction of spaces for collective inter-action is essential in a democratic society.Public spaces promote a sense of egalitarian andactive participation in the construction of co -llective projects that involve common interests,among citizens. For this purpose, a discrimina-tion-free system of participation must beencouraged with the perspective of overcomingracism, sexism, xenophobia, and other discrimi -natory practices. Participation should be pro-moted bearing in mind the importance ofspaces for exchange and deliberation.

Public spaces contribute to knowledge anddevelopment of culture, arts and communica-tion. From the point of view of rights, theseshould be construed as public goods that fosterdialogue, bridge differences and favor mutualacknowledgement between diverse individualsand social groups that compose Ecuadoriansociety. This in turn enables the free expressionof beliefs, attitudes and identities. The statemust create mechanisms that revitalize memo-ries, identities and traditions, as well as promotethe exhibition of current cultural creativity.

The generation of healthy, joyful, safe andinclusive public spaces must be encouraged sothat individual may enjoy a non-instrumentaluse of their time. The use of free time in cultu -ral, artistic, physical and recreational activities

for all age groups improves the health, unders -tood both in physical and spiritual terms, of thecountry’s inhabitants.

Policies7.1. To guarantee the right of people to access

and enjoy public spaces in equal condi-tions.

7.2. To promote rights and duties regardingthe use of public spaces.

7.3. To foster and optimize the use of publicspaces to practice cultural, recreationaland sports activities.

7.4. To democratize the supply of diverse cul-tural expressions by ensuring the free cir-culation, recognition and respect ofmultiple social identities.

7.5. To promote the creation and consolida-tion of permanent public spaces of inter-action between diverse groups, thatpromote interculturalism, mutual recog-nition and collective expressions.

7.6. To guarantee the right to the free, inter-cultural, inclusive, responsible, diverseand participative communication of thepopulation.

7.7. To guarantee the right to enjoy the cityand its public spaces following principlesof sustainability, social justice, genderequality and cultural respect.


7.8. To improve the safety levels of publicspaces.

Goals7.3.1 To multiply by three the percentage of

people who perform recreational touristicactivities nationwide by 2013.

7.4.1 To increase the weekly time devoted toculture by 40% by 2013.

7.8.1 To decrease the mortality caused by tran-sit accidents by 20% by 2013.

7.8.2 To reduce the rate of homicides by 50%by 2013.

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Objective 8:To Affirm and Strengthen National Identity, Diverse Identities,Plurinationalism and Interculturalism

In each period, historically conditioned systemsof culture take the form that social life dictatesand are transmitted from one generation to theother. This is what we call ‘identity’; a group offeatures that express the relations of the commu -nities with their historic and social conditio -ning. Both long-term and transient features canbe identified. The first ensure the continuity ofsocieties in time; mostly through tradition andhistoric memory. The second correspond tomoments of social and human reality.

The interconnection between the social andcultural spheres implies that the State must pre-serve and guarantee cultural rights (both indi-vidual and collec tive), as a basic tenant of thereproduction of human life. Society, in turn,must be vigilant that the State complies withthis role. State and society both have sharedresponsibilities in to ensure the conditions forthe permanence and reproduction of culture inits multiple expressions.

Ecuador’s plurinational and intercultural charac -ter means that the State must adopt a broad andinclusive conception of culture. The State musttake into account and mirror the multiplicity ofsymbolic universes expressed in Ecuador’sdiverse historic memories, and recognize thepractices and livelihoods of the different peo-ples and nationalities. Additionally, the Statemust recognize the practices of cultural groupsthat emerge as the result of contemporary socialtransformations.

This new perspective enables us to examineother forms of regional, gender and genera-tional diversity and analyze each individual’scapacity to contribute to the construction ofrelations based on equality, dialogue and cre-ativity.

Interculturalism, together with plurinationa -lism and Good Living, implies being capable ofreaching agreements between differentiatedcultural, social, political and institutionalactors, within the context of an inclusive, sove-reign and reciprocal society able to establish along-term development proposal to confrontthe challenges of globalization and its contra-dictions in the current world crisis.

Policies8.1. To support the construction of a plurina-

tional and intercultural society, in recog-nition of differences and mutual respect,under the principles of Good Living.

8.2. To overcome social and cultural inequa -lities by guaranteeing universal access todiverse cultural goods and expressions.

8.3. To promote the knowledge and expre -ssion of the diverse socio-cultural identi-ties of the different peoples and natio -nalities that make up Ecuador, as well as ofthe Ecuadorians who live abroad, in orderto strengthen Ecuadorian identity.

8.4. To foster and support individual, groupand community cultural creative processes


in all their forms, languages and expre -ssions.

8.5. To foster and support processes that pre-serve, strengthen and disseminate collec-tive and individual memory and thecountry’s cultural and natural heritage inall its wealth and diversity.

Goals8.3.1 To increase the indigenous population’s

fluency in their native languages to 80%by 2013.

8.5.1 To ensure that 30% of national heritagesites are open to the public by 2013.

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Objective 9:To Guarantee Rights and Justice

The main purpose of the new constitutional orderis the acknowledgment, promotion and guaranteeof rights. In this regard, it marks a diffe rence withthe former model since it redefines the relationsbetween State, society and nature. Individuals,peoples and nationalities decide their desti nies,and the State authority defines the cohesivemechanisms with which decisions contribute tothe construction of a collective project.

The Constitution is the primary instrument forthe guarantee of rights. It determines the con-tents of law; it provides mechanisms to guaran-tee rights; it establishes limits to the exerciseand structure of power; and it can be directlyenforced by any person, authority or judge.Therefore, in order to assure the exercise ofrights, the Constitution subjects and limits allpowers, including constituent power.

No less important is the recognition of the exis-tence of other legal systems, such as the indige-nous, regional, inter-regional and universalsystems. This approach stands in stark contrastwith the liberal model of the State, in whichthere is scope for but one legal system andhuman rights are subject to legislative approval.Similarly, the essential objective of the State isto promote equality and avoid exclusion anddiscrimination. In this way, the creation andenforcement of the judicial system are directlyaimed at producing democratizing results.

This objective seeks to strengthen juridical plu-ralism and institutionalizes the principles ofefficiency, timeliness, transparency, honesty

and impartiality in the judicial system. Aboveall, it contributes to guaranteeing an egalitarianaccess to the administration of justice, particu-larly for people in need of priority services.There is thus an emphasis on the eradication ofall forms of violence that infringe on the rightsof individuals, communities, peoples andnationalities.

Finally, special attention must be given to therights of prisoners and their families. Theirrights should be guaranteed and protectedthrough public policies seeking to transform theprison system into a rehabilitation system thatgenerates opportunities for social and economicintegration.

Policies9.1. To enforce and practice juridical plura -

lism by observing constitutional rights.9.2. To promote a code of laws consistent

with the plurinational nature of theconstitutional framework of rights andjustice.

9.3. To foster an independent, efficient, effec-tive, timely, impartial, adequate and inte-gral administration of justice.

9.4. To eradicate practices of violenceagainst the individuals, peoples andnationalities.

9.5. To promote a social rehabilitation systemthat enables the exercise of rights andresponsibilities of imprisoned people.

9.6. To promote the knowledge of legal andjuridical processes among the population.


Goals9.3.1 To ensure that 75% of cases are resolved

by 2013.9.3.2 To reach 60% of efficiency in the resolu-

tion of criminal cases accumulated by2013.

9.4.1 To reduce violence against women:- physical violence by 8%.

- psychological violence by 5%.- sexual violence by 2%.

9.4.2 To eradicate the aggressions of teachersin primary and secondary schools.

9.5.1 To reduce by 60% the current deficit ofsocial rehabilitation centers by 2013.

9.5.2 To eradicate the incidence of tuberculosisin prisons by 2013.

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Objective 10:To Guarantee Access to Public and Political Participation

The 2008 Constitution consolidates participa-tion; and participation is a transversal axisthroughout the constitutional text. Parti -cipation, for the exercise of popular sovereign-ty, should not only be performed through publicentities, but also through mechanisms for thedirect participation of individuals, communi-ties, peoples and nationalities. In addition, thecommunity of individuals entitled to partici-pate directly in the country’s decisions hasexpanded. Today, young people under 18,migrants, foreigners, the military and thepolice, as well as imprisoned individuals yet tobe sentenced, may vote.

Community democracy is also acknowledgedfor the first time, alongside direct and represen-tative democracy. In the Constitution, the sub-jects for participation are no longer onlycitizens, but also communities, peoples andnationalities. In this way, both individuals andcollectives can wield an influence on decisionsregarding planning, budgeting, management,regulations, control, and on the evaluation ofpublic policies.

Promoting the participations of citizens impliesreinforcing the collective organizations’ demo-cratic power; this means stimulating the capa -city of individuals to mobilize individuals,communities, peoples and nationalities, to carryout voluntary, collective and cooperativeactions of various types so that civil society maybecome the axis that guides the performance ofthe State and of the market.

A democratic government is obliged to stimu-late citizen participation and social organiza-tion without monopolizing them; and toinstitutionalize mechanisms for their free par-ticipation in the State. As a result, true demo -cracy must guarantee the generation and accessto accurate and updated information on thepopulation’s life conditions; it must institutio -nali ze mandatory accountability; and it mustenforce compliance with electoral rules andquotas that guarantee parity representation.

Policies10.1. To promote collective and autonomous

organizations of civil society.10.2. To reinforce, generate and innovate new

forms of checks and balances and accoun -tability for constituents.

10.3. To promote political and electoral partic-ipation under equal conditions in popularelections, official nominations and publicinstitutions.

10.4. To guarantee free and timely access topublic information.

10.5. To promote statistical and cartographicadvances that generate quality infor -mation.

10.6. To promote sustained citizen training andeducational processes that acknowledgeand take into account multiple diversities.

Goals10.2.1 To increase the participation of people

older than 18 years old in organizationsof civil society to 50%, by 2013.


10.3.1 To increase the participation of womenin electoral contests to 30% of all can-didates, by 2013.

10.3.2 To increase the participation of youngpeople in electoral contests to 15% ofall candidates, by 2013.

10.3.3 To increase the electoral participationof all Ecuadorians living abroad to 0.7,by 2013.

10.6.1 To reach the Latin American average inthe people’s professed support fordemocracy, by 2013.

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Objective 11:To Establish a Sustainable Socio-economicSystem based on Solidarity

The 2008 Constitution establishes theEcuadorian economic system as a social andsoli darity-based economy. This, however, is notan exact depiction of the current reality, butmerely a desirable objective. As a result, a tran-sition must be undertaken from the currentmodel based on neoliberal capitalist hegemonythat deepens wealth concentration, fosters aloss of sovereignty, and encourages privatiza-tion, extreme forms of mercantilization, specu-lative and predatory practices against humansand nature, to a sovereign economic systemmodeled on Good Living, which seeks to over-come injustice and inequality.

The central focus of the new economic systemis Good Living and food and economic securityand sovereignty. Its aim is the reproduction oflife cycles, in its integral sense, and the achieve-ment of balances between production, work andenvironment, with self-determination, justiceand sovereign international relations. Thismeans fundamentally changing the economiccycle, that is, production, reproduction, distri-bution and consumption. It implies inaugura -ting a new productive system; from a primaryexport-led and extractivist model to a modelthat privileges diversified production and ser -vices based on knowledge and biodiversity, suchas ecotouris m and biomedicine.

This transition is especially viable becausestrong bases already exist in our economy forwhich to build this new model. There are todaymany diverse forms production and reproduc-tion logics, especially the ones related to subsis-

tence and family economies, although thesehave not been recognized by neoliberal logic.Popular forms of production with local roots,often embedding a sense of cooperation andreciprocity, or displaying knowledge related toconservation and natural resources, haveremained a fundamental feature of the “other”Ecuadorian economy. This unrecognized andignored form of economic production andexchange has nevertheless enabled many peo-ple to sustain basic production and livelihoodsin the midst of the neoliberalism’s eagerness forunrestrained accumulation, often fomented bynational and transnational elites.

Economic diversity, as a key of transition, isinseparable from a form of economic democra-tization that comprises several different dimen-sions: access to resources in equitable conditions;revalorization and strengthening of actors, terri-tories, pro cesses and economic relations – par-ticularly the relations that have systematicallybeen confronted to great disadvantages thathave resulted in poverty –; and direct participa-tion in decision-making processes.

The State – not only in its role as regulator ofthe economy but as a redistributor and directprotagonist of economic activity – must play anessential role in the defense of economic justiceand in the transition to another economicmodel. Actions, processes and policies such asde privatization and the state control overstrategic resources and infrastructure, are thusparamount. The State must play a crucial rolein planning to achieve an endogenous economy


for Good Living; in investments and State’spurchases, contracting and hiring of services, inorder to create the appropriate productive con-ditions and to stimulate sectors and territoriesin disadvantageous situations; in the expansionand consolidation of public companies andservices; and in the promotion of a regional andeconomic integration that benefits the country.

The new productive model also seeks to imprinta public character to technology and know -ledge. The model must also be associated to apublic financial sector that articulates thepublic, private and popular sectors, and whichis able to direct national savings to nationalproduction in its diverse forms.

As part of the new economic cycle, and indefense of the need for a new social and environ -mental awareness, it is vital to generalizeresponsible consumption patterns that strengthenfood sovereignty and the endogenous economy.

Policies11.1. To promote a sustainable and territo -

rially balanced endogenous economy forGood Living to guarantee rights. Thiseconomic system must seek productivetransformation, diversification and spe-cialization, based on the promotion ofdiverse forms of production.

11.2. To promote small-scale activities andmedium-size units of economic associa-tion, and to promote demand for thosegoods and services.

11.3. To promote the productive conditionsrequired to achieve food sovereignty.

11.4. To promote the sovereign developmentof strategic sectors, within a context ofthe environmentally and socially respon-sible use of non-renewable resources.

11.5. To strengthen and expand the coverageof basic infrastructure and public servi -ces in order to increase economic capa -cities and opportunities.

11.6. To diversify the mechanisms of eco-nomic exchange, to promote fair pricesand quality schemes to minimize thedistortions of intermediation, and toprivilege complementarity and solidarity.

11.7. To promote adequate conditions fordomestic and international trade, with aspecial emphasis on trade’s relationshipwith production and living conditions.

11.8. To identify, control and sanction unfaircompetition practices, violations of eco-nomic rights and public and collectivegoods, to promote equal conditions andopportunities in the market.

11.9. To promote access to knowledge andtechnology, and to foster their endoge-nous generation as a public good.

11.10. To promote changes in consumptionpatterns, in order to reduce imports, andin particular imports for luxury items,and to generalize healthy habits andsocially and environmentally responsi-ble and solidarity-based practices.

11.11. To promote the ecosystem’s sustainabi -lity by implementing clean productiontechnologies and practices.

11.12. To seek macroeconomic sustainabilityby strengthening the public sector’s eco-nomic role in planning, (re)distribution,regulation and control.

11.13. To promote national savings and invest-ment by consolidating the financial sys-tem as a public service. There must becomplementarity and synergy betweenthe public, private and popular sectors.

Goals11.1.1 To reduce the concentration of exports

per product to 0.72 by 2013.11.1.2 To reach 5% growth of the non-oil

industrial GDP by 2013.11.2.1 To increase the proportion of the role of

small and medium-size companies inthe State’s purchasing of goods andservices to 45% by 2013.

11.2.2 To deconcentrate the food commercia -lization market by 2013.

11.3.1 To increase the participation of natio -nal food production in relation to totalsupply to 98% by 2013.

11.4.1 To increase oil production (State andprivate) to 500.5 thousand barrels perday by 2013.

11.4.2 To reach a production of oil derivativesof 71 thousand barrels per day by 2013,and an additional 176 thousand barrelsby 2014.

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11.4.3 To increase the metal mining (gold)production under sustainable condi-tions for small mining companies by79% by 2013.

11.4.4 To substitute 8 % of non-metal miningimports by 2013.

11.5.1 To reduce to 5 days the time for cus-tom’s release by 2013.

11.5.2 To decrease by 10% the average time oftransport between cities by 2013.

11.5.3 To reach a development index for infor-mation and communication technolo-gies of 3.34 by 2013.

11.5.4 To increase the rate of mobile cargo to8.4% by 2013.

11.5.5 To increase passenger air transportationby 6.5% by 2013.

11.6.1 To reduce the concentration of exportsper exporter by 0.06 points by 2013.

11.11.1 To increase the participation of thetourism sector in the non-oil exports ofgoods and services to 15.1% by 2013.

11.12.1 To reduce the percentage of non-regis-tered imports by 50% by 2013.

11.12.2 To reduce the rate of non- registeredexports to 1% by 2013.

11.12.3 To increase the share of investment ofnominal GDP to 8.1% by 2013.

11.13.1 To increase the share of foreign directinvestment of GDP to 3% by 2013.

11.13.2 To multiply by three the percentage ofhomes which dedicate their remittancesto productive activities, by 2013.

11.13.3 To increase the public banks’ volume ofoperations by 69% by 2013.

11.13.4 To increase the public bank’s volume by110% by 2013.

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Objective 12:To Build a Democratic State for Good Living

Neoliberalism, with its state-weakening agenda,made the State into a representative of theinterests of economic groups that ran publicinstitutions with the sole aim of extractingresources from the population and transferringthem to private elites. This was the basis of“predatory States.”

Implementing a new strategy for Good Livingrequires a deep transformation of the State.Recovering national sovereignty and the publicsphere, understood as everything that belongsto everyone, demands a radical process ofdemocratization. One of the hurdles is preciselythe democratization of the State itself.

The first step in democratizing the State impliesrecovering and strengthening its planning, regu -lating, control and redistributing capacities; de-privatizing it and forcing it to effectively representpublic interest. The institutional reform of theState seeks to build an intelligent, dynamic andstrategic State that requires consolidating effi-

cient, meritocratic and result-oriented institu-tions.

The second step is the construction of thePlurinational and Intercultural State. It impliesa broad process of institutional reform thatmakes intercultural policies possible. For thispurpose, it is vital that the new State acknow -ledge the ancestral territories and the govern-ments of the peoples and nationalities of Ecuador,the establishment of indigenous, afro-Ecuadorian,and montubio Territorial Constituencies.

The third step is the construction of a polycen-tric, deconcentrated and decentralized State.

A radical democratic State must be close to itscitizens. It must also be territorially and cultu -rally diverse. There is, therefore, a need to pro-mote a sound process of deconcentration of theexecutive branch and a process of decentralizationof political power in favor of the AutonomousDecentralized Governments. Building an efficient


public administration close to the people meansworking in an articulated fashion with differentgovernment levels. For this purpose, an equitableterritorial organization must be promoted; onethat favors solidarity and responsible autonomy,and strengthens the articulation of planningbetween different levels of government.

The central purpose of this process is effectivepublic policies for human beings. This is whythe fourth step in the process of State democra-tization is social and citizen participation at alllevels of government.

The State is a key actor for change. It is theguarantor of the adequate performance of themarket and intervenes to correct its monopolisttrends. The State is responsible for the univer-sal provision of goods and services for the pur-pose of enforcing the rights of people.

Policies12.1. To construct the Plurinational and

Intercultural State for Good Living.12.2. To consolidate the new institutional

organization of the State to recover theState’s governing, planning, regulation,control, research and participationcapacities.

12.3. To consolidate an articulated model ofState management in order to deepen theprocesses of decentralization and decon-centration, and to promote a balan cedform of territorial development.

12.4. To foster efficient and competent publicservices.

12.5. To promote quality, timely and continu-ous public services with ample coverage,and to strengthen regulation mecha-nisms.

12.6. To improve the management of statecompanies, and to strengthen regula-tion mechanisms.

12.7. To foster decentrali zed and participativeplanning with a rights-based approach.

Goals12.1.1 To increase the participation of indige-

nous people and afro-Ecuadorians wor -king in the public sector to 12% by 2013.

12.3.1 To reach 82% of households with accessto public running water network by 2013.

12.4.1 To improve people’s perception of thepreparation of civil servants by 60% by2013.

12.5.1 To increase to at least 7 the perceptionof the quality of public services.

12.6.1 To reduce electricity losses in distribu-tion to 11% by 2013.

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The National Territorial Strategy consists of aset of guidelines that match public policies tothe characteristics of a geographically demar-cated territory. This policy is intended as a refe -rence to guide the creation and implementationof sectorial and territorial policies in accor-dance with the objectives and goals defined inthe Plan. Hence, the Territorial Strategy shouldalso serve as an instrument that facilitates coor-dination between different levels of govern-ment, in as much as it must help bring about afluid relationship between territorial and natio -nal planning objectives.

Given that the configuration of national terri-tory is a complex, fluid and dynamic process, itis important that any policy intended to articu-late the diverse characteristics of a geographicalarea into coherent policies is flexible enough tobe able to accurately and democratically reflectthe visions and contributions of both the citizensand the institutions that act within a given area.

8.1. A New Territorial Modelto Achieve Good Living

Territory and geography reflect the economic,political, and social history of a country orregion in that together they constitute the spatialexpression of diverse forms of accumulation anddistribution of wealth. From this perspective, it

is possible to see how both public and privatepolicies are materialized and implementedwithin specific territorial boundaries. Lookingat the history of Ecuadorian territorial occupa-tion helps us to understand the processes ofchange that have taken place at economic,political and cultura l levels. Geographical his-tory, on the other hand, tells us more about theinfrastructure, means of transport, agriculturalproduction systems, and industrial facilitieswithin a given area.

In other words, the territorial sphere must beunderstood as both a physical-spatial sphere,and as a sphere in which culture interacts withnature, i.e., as a series of “social-natural proce -sses” that are “projected in territorial spheres”(Coraggio, 2009:13), and thus should be unders -tood as processes that generate a series of com-plex dynamic relations.

Thus, it becomes evident that territory is inti-mately linked with the concept of Good Livingproposed in the Plan, since it harmonizes theconcept of the endogenous economy withstrategies aimed at the strategic insertion ofEcuador into the world.

In order to effectively analyze the complex andmultilayered interactions that occur within agiven territorial boundary, it is necessary tounderstand what is happening on a number of

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8. National Territorial Strategy


different levels simultaneously. This multila -yered analysis spans from a micro-level analysisof the day-to-day affairs to an analysis of supra-national interrelations between states. However,it also implies the need to understand the inter-action between structure and agency.

Viewed from this perspective, it becomes evi-dent that the making of the National TerritorialStrategy is an organic process that is born out ofthe social, political, cultural and geographicalrealities of diverse territories that constitute thenation as a whole. The National TerritorialStrategy seeks to transform the nature ofEcuador’s interactions within the internationalsystem; to improve geographic distributionbetween urban and rural areas; and to enable abalanced and sustainable livelihood for thenation’s inhabitants. Thus the plan must esta -blish public policy guidelines for the effectivemanagement of national planning.

In order to fulfill these objectives, planningmust be organized along technical and strategiclines, but most importantly, planning mustreflect the participation of the territories’inhabitants. The aim of territorial planningmust be to generate local capacities in a waythat respects the coexistence of distinct cul-tures, reflected in a way that demonstrates atole rance towards different approaches to pro -blems-solving. Only through these participa -tory processes will it become possible to bringabout an organized process of decentralizationthat is designed upon more equitable, inclusive,and sustainable principles that favor economicstability, trans parency, solidarity, and co-responsibility.

8.2. The Historical Configurationof Ecuadorian Territory

The configuration of Ecuadorian territory hasits origins in the pre-Inca empire. Since then,Quito has been the center of the northernSierra. Following the arrival of the Incas andthe settlement of Kapac Ñan (the territory’smain axis), territorial settlement was organizedaccording into ayllus and llactas (family groups

and regions). These structures were responsiblefor the management of specific ecological areasand for the regional exchange of products. Ahierarchical system was formed from Cusco toQuito, via Cuenca, all of which remain to beprovincial capitals to this day.

The Spanish founded the cities on these Incaand pre-Inca structures and their system ofdomination included the appropriation of terri-tories; and the displacement of Indian popula-tions established in the central valleys of theSierra. The appropriation was carried outthrough the establishment of haciendas andobrajes. In both the southern Sierra and theAmazon, the occu pation of territory dependedon mining exploitation systems called mitas.

In the 18th century a new fluvial system wasestablished to facilitate the exchange of agricul-tural products and to further regional trade.This system connected the Port of Guayaquil toother towns along the Coast, which enabled theconsolidation of settlements in the high andlow basins of the Guayas River.

8.2.1. The RepublicanTerritorial Model

Ecuador has always been subject to the whimsof the world market, and has long since been avictim of the volatile consumption patterns ofthe industrialized countries. These factors havepersistently conditioned any serious advancesin national development, rendering the successof its economic policy to external factors,seemin gly out of the control of State policies.

Over time, this model of accumulationincreased the gap between rich and poor terri-tories. This process was translated into infra-structure that prioritized the demands of theexport–related sectors to the detriment of thedevelopment of domestic trade networks, thus,resulting in uneven development across theregions. Between 1980 and 1990, the neolibe ralagenda further exacerbated this process. TheQuito-Guayaquil bi-centralism was consolidated(Verdesoto, 2001) and, with it, an asymmetricdegenerative territorial model was perpetuated.

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By the end of the 19th century, the countryalready had 15 provinces, ten in the Sierra andfive on the Coast. The Amazonian provinceswere only created in the 20th century. While thefoundation of many of these provinces did notrespond to a specific demographic process, itwas based on an exploitative model of wealthgeneration and on the establishment of regio nalchieftaincies. By the second half of the 20th cen-tury, demographic growth had increased subs -tantially and, between 1950 and 2001, thepopulation had quadrupled, albeit but withstrong regional differentials (León, J., 2009).

Ecuador’s human settlement network respondsto the history of its economic developmentmodels. The cacao agro-exporting periods are,hence, clearly marked by the emergence ofsome of what are today the largest inland cities(near coastal cities). Later the period known asthe banana boom, developed the ports andaccesses to them. After the first stage of indus-trialization, the Sierra’s backbone of the coun-try’s road network was constructed. Finally,during the oil boom, oil pipelines, the infra-structure for the huge oil industry, and the corres -ponding road network was built in the north ofthe Amazon region.

8.2.2. The Ecuadorian Geography49

The Andean Cordillera divides Ecuador’s conti-nental territory in 3 natural macro spaces orregions: the Coast, the Highlands (or Sierra),and the Amazon. While this division certainlycorresponds to a set of indicators that measurealtitude, soil types, and climate, it also corres -ponds to the evolution of a number of impor-tant cultural and social characteristics.

The Coast boasts the most favorable commer-cial conditions within the national economyprimarily due to two significant agro-exportingcycles. The Amazon region however, has themost disadvantageous economic conditions

despite the wealth generated through oilexploitation.

Complementary to the geographic division, twonorth-south axes have also emerged. The coastalstrip that includes the ports of Guayaquil,Manta, Puerto Bolívar, and Esmeraldas; and thePan-American Highway, which links the citiesof Quito, Ibarra, Ambato, Cuenca, and others.

Both axes are connected through developmentnodes (urban groups or networks) and trans-portation infrastructure. In the case of thecoastal strip, agricultural production and seaportsare connected. What is now the Pan AmericanHighway existed prior to the Spanish Conquestand has remained intact ever since.

Throughout history two cities have developedmore dynamically than the rest of the country –Quito and Guayaquil. Quito is an Andean city,the capital and political center; and Guayaquilis a tropical city, boasting an international port.Guayaquil is considered to be the country’s eco-nomic powerhouse. Together, the two citiesrepresent almost 30 % of the population.

Along the axes that join these two large cities,an area of major population density and higherlevels of infrastructure has emerged. A group ofsmall urban centers has evolved, some of whichare densely populated. On the margins, forestedareas and sparsely populated border zonesabound.

8.2.3. Reconfiguring theNational Territory

The transformation of the national territorialstructure requires public policies to be suited tothe specific conditions and characteristicsfound in each region. Inter- and intra-regionalsynergies and network systems must be promo -ted to favor the country’s endogenous develop-ment. The territories must be understood as

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49 This section is based on several works published by Jean Paul Deler where an interpretation of Ecuador’s territorial orga-nization was advocated. This interpretation enables to clarify the national territorial system and move towards an inter-pretation of its structure elements.

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regions that possess specific functions whichshould be articulated in a complementary fa -shion. Policies should place equal importanceon rural and urban areas. Great importanceshould be attributed to generating equal oppor-tunities that ensure equal access to basic utili-ties, health, education, nutrition and housing.

It must be stressed that establishing the evendevelopment across the country, and ensuringthe effective management and universal accessto services will only be achievable if accompa-nied by strategic investments in key areas andconsistent policy reforms.

Thus the Territorial Strategy should hinge onthe following seven elements:

• To establish and reinforce a polycentric,

articulated, and complementary structureof human settlements.

• To promote Good Living and food sove -reignty in rural territories.

• To give priority to transport, connecti -vity, and energy.

• To guarantee the sustainability of naturalthrough the rational and responsible useof renewable and non-renewable naturalresources.

• To foster and promote diversity and cul-tural heritage.

• To foster a strategic and sovereign inser-tion into the world and to strengthenLatin American integration.

• To consolidate a decentralized and decon-centrated management model based onintelligent and participatory managementpolicies.

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Map 8.1: Graphic expression of the National Territorial Strategy50



51 The maps that are shown throughout the National Territorial Strategy are indicative; a graphic visualization based oncoremas has been used to represent the national territory. The sectorial planning and development and land use mana-gement plans will produce more precise detailed maps.


8.3. Strengthening aNational, Polycentric andComplementary Structureof Human Settlements

The consolidation of a national polycentricstructure must be understood as the balanced dis-tribution of human activities within a given area(CE, 2004.) It is about structuring a network ofcities or urban units of different sizes in a comple-mentary fashion that take into account severaleconomic and productive acti vities that strive toachieve social, economic, and territorial cohe-sion according to the principles of Good Living.

With this we seek to guarantee rights; promoteproductive activities and stimulate productivechains; control and moderate urban growthbased on the environmental capacities of surrou -nding areas; In addition to these objectives,policies must include plans for the viable mana -

gement of waste disposal and pollution control.Finally, it is crucial to stimulate advances inresearch, science, and technology according tothe specific needs of the territories.

The country’s rapid urbanization over the lastdecades has created a densely populated urbansystem with network settlements (urban groupsor nodes) that include cities, adjacent towns andsurrounding areas that reveal a series of terri -torial imbalances. Some zones have seriouslimi tations derived from their geographic cha -racteristics, peripheral areas with serious prob-lems of accessibility, and remote rural territories,all with poverty-related problems.

Based on these characteristics of the nationalterritory, (size and distance), four categories ofurban groups have been identified throughwhich it is hoped to improve the distribution ofservices and foster synergies.

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Map 8.2: Analysis of Human Settlements

Incorporating Population and Functional Relations

Note: The following urban groups have been designated:

• Sustainment groups, with 20,000 to 50,000 inhabitants, profiled as gathering centers and trade zones.

• Regional link groups, with 200,000 to 500,000 inhabitants, structured as regional exchange centers with a first-order industrialization level.

• National structuring groups, with 500,000 to 1,000,000 inhabitants, profiled as centers of research, technology transfer, and advanced

industrialized processing and have higher productive diversification.

• International articulation groups with 2,000,000 to 3,000,000 inhabitants that, due to their scale, constitute a set of national and interna-

tional financial, administrative, and commercial exchange services.

Source: INEC, 2001. Population projection, 2009.

Prepared by: SENPLADES - Dirección de Planificación Territorial/Subsecretaría de Planificación.


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8.3.1. Guarantee of rights andbasic service provision

The polycentric, universal human settlementsystem aims to improve universal access to thefollowing services:

• Expansion of health, education y socialprotection services.

• The supply and improvement of basicservices such as drinking water, sewagemanagement, and effective, safe wastedisposal systems.

Autonomous Decentralized Governmentsmust play a key part in this territorial planningprocess.

Each type of human settlement or urban groupnetwork has specific requirements that enableit to potentiate its functions in the nationalcontext. The Chart below resumes the articu-lations required to strengthen each type ofurban group.

Chart 8.1: Functions According to the Urban Group Typology




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8.3.2. Productivity, ProductiveDiversification and Generationof the Territories’ Added Value

Territorial productivity requires synergiesbetween the rural and urban productive systemsin order to promote the endogenous economy.It is important to emphasize the importance ofsystemic productivity beyond the mere notionof competitiveness. Competitiveness is con-ceived as the different possibilities that emergeas a result of establishing linkages between thevarious levels of economic activities.

In order to overcome the urban-rural dichoto-my which agricultural production faces in thenational and international system, the polycen-tric structure must be founded in the notion ofstrengthening value chains and generatingemployment. This means strengthening the sus-tainment (agro) productive nodes correspondingto the basic rural development spheres; linkingthem to diversified modes of production.

8.4. Promoting Good Livingand Food Sovereignty inRural Territories

Good Living in rural territories is based onregenerating national food production, mainlyfrom peasant production, to guarantee thesocial regeneration of the rural population andto guarantee that fair, sustainable rural develop-ment policies translate into national develop-ment. In order to conduct endogenousdevelopment in the rural territories, an associa-tive agro-production model must be pursued byidentifying optimal agricultural productionunits for each context boosting economic effi-ciency of agro-cattle-raising production,employment, income, and wealth generation(net added value) (Brassel, 2008: 11).

For this model to prosper, a context of basicdevelopment support and Good Living in therural territories must include the democratiza-

tion of the means of production means, thestrengthening of short productive chains; pro -duct diversification; commercial associativity;adequate transport infrastructure etc.

8.4.1. The Basic Territorial Contextto Support Rural Development

Support for rural development policies mustinclude the following:

• A minimal level of product diversifica-tion and complementarity in the produc-tive chain.

• Prioritization of autochthonous produc-tion based on locally-found resources andlocal knowledge.

• Clusters and micro-service supplies so asto boost local services and consumption.

• A minimum level of associativity that iscapable of providing producers with orga-nizational and to facilitate the proce -ssing, commercialization, and distributionof their products.

8.4.2. Agro-food ProductionDiversification: Sovereign,Healthy and EfficientProduction

Primary or rural production must consider threemain markets, in this order: internal consump-tion to guarantee food sovereignty; productionintended for the national industry aimed at cre-ating productive chains, the generation ofemployment and added value; an export marketthat favors an intelligent and sovereign inser-tion into traditional and alternative interna-tional markets.

Diversifying production is a step towards theconsolidation of short production chains, thusreturning capital flows to rural spaces. It alsodiversifies the sources of income and reducesthe economy’s dependence on local, national,and international market flows.


8.5. Increasing the Efficiency ofthe Transport, Energy andConnectivity Infrastructure

Mobility, Energy, and Connectivity infrastruc-ture must be organized so as to facilitate corri-dors that benefit the exchange and flow ofgoods.

8.5.1. Mobility: Vertebral Axisand Horizontal Links

The term ‘mobility’ must take into account allelements required to satisfy a persons’ need tomove about freely; to communicate with dis-tinct points locations across the expanse of theterritory; to have access to basic services, and tomove about within areas of production andcommercialization.

The management of transport infrastructurerequires an analysis of the current demands thatarise out of the need to transport merchandiseand passengers between destinations, bearing inmind the need to move towards more environ-mentally and socially sustainable transport sys-tems. However, it also important to include therisks inherent in the planning of transportinfrastructure given that Ecuador is a territorywith a high concentration of environmentalthreats capable of restricting the free access ofpersons and goods.

Horizontal links or longitudinal corridors mustalso be considered. These axes create road net-works that contribute to industrial develop-ment, promoting the creation of productivechains and thus strengthening the endogenousdevelopment model.

In order to have an integral vision of the roadsystem, we need an overall vision of the coun-try’s transport infrastructure including ports,airports, bridges, and railway stations.

The air transportation sector needs requires therenovation of air transport facilities to ensurethe eventual compliance with air safety regula-tions. The effective management of these faci -lities is vital to the development of both

domestic and international tourism infra-structure.

8.5.2. Energy Production,Transmission and Distribution

The development of the energy sector is a keyfactor for Ecuador. It is crucial to be able toguarantee energy supply through the generationof hydroelectric power.

The generation of thermoelectric power is to bereduced, and the transmission and sub-trans-mission networks strengthened by adaptingthem to the estimations of future supply anddemand of electricity. This strategy however,must be complemented by the country’s gradualmove towards of other renewable energysources: sun, wind, geothermal, biomass, andtidal power by establishing electric power gene -ration form other renewable sources consideredto sustainable, long-term alternatives.

All these initiatives must observe to strict envi-ronmental regulations, and must obey equitableprinciples of power distribution policies.

Finally, public lighting infrastructure must beimproved and expanded and specific rules mustbe issued for urban historic centers. The expan-sion of power and connectivity networks inrural zones must be a priority.

8.5.3 Connectivity andTelecommunications

Over the last few years, the telecommunica-tions sector in Ecuador has developedunevenly. It is evident that there is a perma-nent growth of supply and demand of mobilephones. Land lines however, have stagnatedsomewhat. Nevertheless, international mar-ket trends show that fixed telephone linescan still develop with the use of new tech-nology, and new innovative services, such asTriple Play (television, telephone, and inter-net), broadband, etc. Furthermore, theaccess to Internet shows an imbalance thatgives priority to the most densely populatedurban centers.

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Map 8.3: Corridors of Mobility, Connectivity, and Energy Infrastructure

Source: Electric power (Plan for the electric sector’s expansion - MEER and Transelectric 2008), Connectivity-Fiber Optics

(Corp. Nac. Telecommunications, Fondo Solidaridad, 2009), Road Administration (MTOP, 2008), Ports (Dig. Mer, 2005; IGM,

2003), Airports (DAC, 2003.)


The need to expand the fixed telephone net-work and the access to Internet nationwide hasbeen identified. New infrastructure must bedeveloped in the marginal urban and ruralzones of the country in order to democratize theaccess to technology. The access to these basicservices must be guaranteed in all publicschools, community centers, and governmentoffices at every level.

8.6. Guaranteeing the Sustainabilityof the Natural Heritagethrough the Rational andResponsible Use of Renewableand Non-Renewable NaturalResources

The Ecuadorian natural heritage is a strategicresource of national importance for Good


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Living which must be used in a rational andresponsible way, by guaranteeing the rights ofnature, as set forth in the Constitution. Thegeographic characteristics of the country,formed by natural, agro-cattle-raising, andurban areas, must be construed as one singleterri tory, each with their respective function.

8.6.1. BiodiversityEcuador, one of 17 megadiverse countries in theworld, has the highest concentration of species,containing between five and ten percent of theplanet’s biodiversity.51 The country consists ofthe Galapagos Archipelago, a living laboratoryof the evolution of the species; and theAmazon, a world-class natural reserve withunparalleled biodiversity.

In spite of the existence of certain areas thatcurrently form part of the State’s Natural AreaHeritage (PANE), the State is obliged to con-serve “all” natural areas (land and marine) that

exist within the boundaries of national terri -tory, not only those marked out by PANE.

Nature has a direct and indirect value on soci-ety’s activities. Biodiversity must be understoodas an important source of science, technology,and related economic activities, a guarantee offood sovereignty and safety, a source of natio naland international tourism: and in the case offorests, a source of oxygen with importantpotential in the world of carbon bond markets.

Land and marine biodiversity managementdemands the active involvement of communi-ties in the sustainable administration of naturalareas and their buffer zones. Additionally, it isimportant to foster the recovery of degradedsoils, refores tation, and the sustainable manage-ment of the land. This also implies putting inplace rigorous controls that limit the expansionof the agricultural borders, based on the carefulidentification of soil use according to produc-tive inclinations and capacities.

51 “The areas of natural vegetation coverage constitute 52% of the Ecuadorian territory of which around 17% is compo-sed by the “State Natural Area Heritage” (PANE) which include the National System of Protected Areas and protec-ting blocks. Additionally, marine protection areas shall be added – 1,164 sq. km and 47,098.58 sq. km of the GalapagosArchipelago protection” (MCPNC, 2009.)


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Map 8.4: Valuation of the Natural Land and Marine Coverage

Source: Remnant vegetation per continental ecosystem (PROMSA 2002, Ecoscience 1999.) Identification of conservation

gaps and priorities for land biodiversity in continental Ecuador (EcoCiencia, TNC, CI, MAE, 2006)


8.6.2. Managing HydrographicBasins and Hydric Resources

Water is a fundamental human right; the Stateis obliged to guarantee its adequate usage anddistribution by giving priority to human con-sumption over other uses, such as irrigation,food sovereignty, and other activities for whichan adequate pollution control of all hydricsources is necessary.

In terms of hydric resource availability, Ecuadoris a privileged country. Nevertheless, the distri-bution of runoff waters inside the territory isirregular. This generates zones with largedeficits which are particularly exacerbated in

densely populated, urban areas: and in areaswith were citizens are unaware of the adequateuse and preservation of water. The TerritorialStrategy seeks to achieve an integrated and sus-tainable management of water in each hydro-graphic basin, intended for human consumption,irrigation, and power generation. Besides,implementing solutions to minimize the im -pacts of liquid waste and water pollution onnatural streams are extremely important.

The percentage of power generated by hydricsources has dropped. Whereas in 1994 it repre-sented 58%; it dropped to 42% in 2006 as aresult of the lack of investment in the sectorand the increased use of thermoelectric power.


This gave place to periodic electric shortagesacross the country. In this context, one of theState’s most important projects is to change theenergy matrix to increase power generationthrough hydroelectric and other renewablesources. The responsible and technical use ofwater must be fostered for the generation ofhydro- power.

To complement an integral management vision,we must also consolidate a culture of the good

use of the water resource and prevent the risksgenerated by floods and draught. For all this tobe possible, an adequate inter-institutionalmanagement is essential to allow improvingthis strategic resource. Finally, the requiredsocial organization must be considered for theadministration and management of hydro-graphic basins taking in consideration thediverse usages and users based on the constitu-tional precedence and under the fundamentalprecept of the universal access to water.

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Map 8.5: Hydrographic Basis and their Hydric Volumes

Source: SENAGUA 2009.



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8.6.3. Non-RenewableNatural Resources

One fifth part of the surface of the Ecuadorianterritory shelters important non-renewable natu -ral resources: oil reserves, mineral and non-metal reservoirs. Their exploitation – even withall possible precautions in place – inevitably hasan environmental impact. Nevertheless theseresources provide source of income for thecountry.

The Ecuadorian State recognizes the substantialimportance that the extractive activities holdfor the country’s economy, and considers thatthese activities must take place, but only on thecondition of strict compliance with environ-mental rules and regulations. Additionally,projects for environmental restoration, rehabi -litation, and remediation of the existing extrac-tive areas are required. The participation of thelocal communities, who should benefit directlyfrom the projects, should be consulted at everystage of the projects’ conceptualization andimplementation.

Above this series of natural expressions there arepopulations, infrastructure, and services that havenot necessarily considered their exposure to athreat of such high vulnerability and that put thecountry under the risk of disasters of different mag-nitudes. Many of these disasters could be preven -table if some measures are taken, i.e., an adequateland use management, investment in planning, atradition of crisis prevention, strengthening of thecapacities of the different actors that can intervenein crisis prevention of natural disasters etc.

8.6.4. Integral Managementand Risk Reduction

“In Ecuador, several factors pose threats, such asabundant rainfall, steep and expanded streams,geological formations subject to erosion, fluvialplains with weak slopes (the Guayas Basin): andthe subduction zones between the Nazca Plateand the South American Plate (one of theworld’s most active plates) that generates earth-quakes, explosive volcanic eruptions, etc.”(Trujillo, D’Ercole, 2003: 111).


8.7. Promoting diversityand Cultural Heritage

The construction of the Plurinational andIntercultural State requires unity in diversity,where the Ecuadorian society recognizes theexistence of indigenous, afro-Ecuadorian, andmontubio nationalities as political subjects withtheir own rights. One of the aims of thePlurinational State is to guarantee the effec-tiveness of the right to different forms of free-dom, since no subject prevails over any other(Chuji, 2008: 11.)

In this sense, the following are important cha -llenges for the country: to acknowledge theimportance of culturally different territories,peoples and nationalities, and their gradualconformation as indigenous territorial con-stituencies. In this sense, ancestral culturalpractices must be respected; the heritage mustbe revaluated; archaeological sites and localcultural practices must be protected; the know -ledge of cultural diversity must be promoted inthe population; national and internationaltourism must be promoted by respecting andprotecting the territories; and integral compa-

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Map 8.6: Natural Coverage and Anthropic Pressure Zones

Source: Multi-threat map (DINAREN-MAG, INFOPLAN, INAMHI, IGM, IG/EPN, IRD, CEC, 2000.)



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ny-territorial administration processes must bestarted with clear programmatic agendas fromthe different sectors and government levels.

8.7.1. The Peoples andNationalities of Ecuador

Ecuador is composed of 14 nationalities and 18indigenous, afro-Ecuadorian and montubio

groups of people. Twelve languages are spokenthroughout the territory; these languages needto be recognized, known and potentiated as partof Ecuadorian identity and the country’s his-toric-cultural heritage.

The strategy proposes a territorial model thatrecognizes the rights of the peoples and natio -nalities.

Map 8.7: Greater Presence of Peoples and Nationalities & Ancestral Languages

Source: SIISE 4.5, Languages: INEC, 2001.


8.7.2. Cultural Heritage and Tourism

The Ecuadorian tangible and intangible cultu -ral heritage is composed of its languages andforms of expression; urban buildings and monu-ments, spaces and conglomerates; documents,artifacts and collec tions; artistic, scientific andtechnological creations and innovations. All

these elements generate a very rich culturalwealth. However, the absence of a sustainedand deep reflection on culture and on its rela-tion with other areas of social life (economic,social developmental, political, environmental,educational, health-related, etc.), generates agradual loss (both material and immaterial) of


the cultural base itself. Therefore, it is urgent toreorganize the public cultural sector in order tostrengthen the creation of a new system of valuesexpressed in acknowledging diverse identities inwhich we can all recognize ourselves; and to pro-mote the rich traditions inherited from our past.

From a territorial approach, cultural public poli-cies must be equitably structured in the terri toryby balancing investment to the less known andless privileged sectors.

Cultural wealth and our great natural bio -diverse heritage make of Ecuador a privilegedtouristic destination. However, many of the

territories with a touristic potential are poorareas with low levels of service-coverage. Weneed, therefore, to insist on the con cept of theendogenous economy focusing on sustainabletouristic activities as an option for the localpopulations and on channeling their benefits toimprove their quality of life.

Finally, we should not lose sight of Ecuador’stowns and cities. Among them, 22 cities are animportant part of the nation’s cultural heritage;and two, Quito and Cuenca, have earned thetitle of World Cultural Heritage. Policies togive incentives to the conservation and restora-tion of this heritage must be implemented.

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Map 8.8: Heritage Cities, Touristic Routes, and Cultural Diversity

Source: Tourist routes (PLANDETUR, 2008), AIP Pluri-annual, MCPNC, MINTUR, 2009.



8.7.3. Strengthening Social NetworksIn order to boost the endogenous economy, thejoint articulated action of individuals andgroups is required. The actors of civil societymust undertake social surveillance and controlof public institutions.

Strengthening social networks implies guaran-teeing the citizens’ participation by generatingof spaces for interaction between differentactors. This, in turn, may democratize the rela-tions between State and society at all govern-ment levels and actively involve society in allphases of public administration.

8.8. Fostering Ecuador’s Strategicand Sovereign Insertion in theWorld, and Latin AmericanIntegration

South America is living a series of transforma-tions. The democratic election of progressiveleft-wing political coalitions, and the intenseactivity and involvement of society in theprocesses of change, have inverted the economyof power.

The early twenty first century is marked by ageopolitical dispute that leaves behind the tra-ditional balance of power and opens the door toa multipolar international system. Ecuadorappears as a vanguard actor in this change. Ithas also proposed to significantly change thecountry’s strategic insertion in the region andthe world.

Ecuador’s new insertion is strategic because it isgoes hand in hand with the best interests of thepopulation as a whole, and not with the exclu-sive interests of dominant elites. And it is sove-reign because sovereignty lies in the people.After the neoliberal years, when the State wasused to serve private and corporate interestsand its regulating and planning capacities weretaboo, it was especially important to recover

sovereignty as a democratic exercise of popularpower.

8.8.1. Latin American IntegrationFrom the territories, integration means reope -ning debates that were closed with regards tothe meaning of nationality, democracy, repre-sentation, etc. The construction of new spacesof governance surpasses the confines of thenation-state. In this way, Ecuador is putsemphasis on a harmonious integration withinSouth America, in the framework of South-South relations to reverse the current patternsof northern domination. Ecuador must partici-pate in these processes actively and by exerci -sing leadership.

UNASUR is a vital aspect of this new dream.Initiatives such as the Bolivarian Alternative forthe Americas (Alternativa Bolivariana para lasAméricas, ALBA) also play a creative-critical role.

Territorial planning, therefore, confronts newchallenges: first, they are territories per se, withtheir own complexities and potentialities; se -cond they are part of a national whole wherethe country’s interest prevails; third, they arepart of an Andean region where borders must bespaces for peaceful dialogue; and finally, theyare part of a macro system that must strengthenSouth America as a whole and not only certainzones to the detriment of others. The country’slinks with Central America and the Caribbeanmust also be considered.

8.8.2. Ecuador’s Insertionin the World

Ecuador aspires to play a leading role in theworld. Ecuador has demonstra ted this leader-ship with new and refreshing initiatives whichmean has been a vanguard of the environmen-tal struggle. The Yasuní-ITT Strategy aims toachieve a profound change in the interrelationsbetween society and the environment.

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Map 8.9: Priority Countries to Diversify Our International Relations



52 See “En búsqueda de salidas a la crisis ética, política y de pensamiento”, Falconí y Muñoz, 2007.

8.9. Consolidating a Decentralizedand DeconcentratedManagement Model withTerritorial Planning andAdministration Capacities

The territories have great inequalities; the gapsin the quality of life and satisfaction of basicneeds have grown because of an unequal alloca-tion of resources, which is particularly conflic-tive when there is no coordination between theCentral Government and the AutonomousDecentralized Governments (Barrera, 2006.)

The decentralization policies implemented inEcuador during the last decades have beenunsuccessful because of a lack of institutions,the absence of an adequate legal framework,

and the local governments’ limited capacities totake on new functions.

8.9.1. Decentralizationand Deconcentration52

A successful decentralization model implies aradically different State; one that deepens thedemocratic system with a territorial and spatialapproach. Decentralization must be integraland mul tidimensional. It must boost potentiali-ties, emphasize economies of scale and fiscalconsistency but, above all, it must be a trueanswer to the population’s needs.

In order to consolidate the decentralized anddeconcentrated State, the AutonomousDecentralized Governments must be strength-ened and the national development objectives


identified in this Plan must be articulated withthose pursued by the goals of the AutonomousDecentralized Governments. In this context,the political support for the formulation, appli -cation and concretion of the development plans,as well as the implementation of spaces for par-ticipation and deliberation, are both essential.

8.9.2. Management Capacitiesand Territorial Planning

While most of the Autonomous DecentralizedGovernments have developed diverse planninginstruments, they have not as yet been effec-tively implemented. This is because of a num-ber of reasons: the contents of theseinstruments are not of good quality because ofinsufficient information; they do not includemechanisms of control, follow-up and evalua-tion; they have no internal political endorse-ment; they are inconsistent with the centralgovernment’s territorial policies; or they do notallow the appropriation of the policies by publicand private actors within their respectivespheres.

In this context, the Plan must be an instrumentthat steers the budget, public investment, debt,and it must be a public policy instrument thatenables the coordination of the different gover n -ment levels, particularly in the areas of develop-ment planning and land use.

Likewise, development planning and land usemanagement must be located within the frame-work of the National Decentralized System forParticipative Planning. In relation to planningprocedures, a number of tools and instrumentsare currently being developed to establish thepriorities of territo rial development, access toinformation for decision-making processes,resource allocation, and evaluation at eachlevel of the country’s territorial organization.

This is why development planning and land usemanagement are part of a same continuous andcyclical process. It requires a number of pla -nning phases and a territorial management withpermanent monitoring, adjustment and evalua-tion processes.

Figure 8.1: Planning - a continuous

and cyclical process

8.10.Guidelines forTerritorial Planning

The 2009-2013 National Plan for Good Livingis the reference for territorial planning. TheNational Territorial Strategy must be construedas a set of guidelines for planning at all govern-ment levels.

8.10.1.Zonal AgendasThe political reform initiated in 2007 seeks toarticulate and deconcentrate the State’s publicpolicies as an effective and efficient way to shor -ten distances between the people and the publicauthorities, and improve the complex articula-tion between the government’s different admi -nistrative levels. In this sense, processes ofadministrative deconcentration have been pro-moted in the central government. The sevenplanning zones play an important role in thisdeconcentration. Zone planning guides thebudget, gives priority to public investment, inter-national cooperation and, in general, the actionsand policies of the deconcentrated State.

Building a new model of the State with empha-sis on a deconcentrated zone structure entailsfour main challenges: 1) territorializing publicpolicies to serve specific needs in the differentterritories, 2) establishing territorial functionsand roles, 3) fostering zonal dynamics that con-

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8.10.2.Development planningand land use management

The National Plan for Good Living, therefore,defines the policies and strategies that must beimplemented as general guiding principles forthe Autonomous Decentralized Governments.Its contents must inaugurate, in turn, a processof participative reflection and deliberation inwhich the plans of the different levels of gover -

nment are taken into account as complemen -tary instruments to this Plan.

On the other hand, the Plan and the territorialstrategy include the State’s interventions insidethe territory of the Autonomous DecentralizedGovernments. This means that within the te -rritorial planning processes, a series of interven-tions related to the implementation of a

tribute towards the materialization of the aims ofthe National Plan for Good Living and the newlong-term accumulation and (re)distribution

strategy, and 4) promoting a new administrativestructure that articu lates public management inthe zones.

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Map 8.10: Planning Zones Map



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national project must be also considered. Theuse and occupation of the land must be consis-tent with the implementation of national pre-rogatives and projects.

The guidelines for development planning andland use management should promote thearticulation between different levels of govern-ment and must be accompanied by the formu-

lation of statistical and mapping information toassist the planning process. There is also a greatneed for the strengthening of the institutionaland human capacities of the AutonomousDecentralized Governments if the planningcycle is to transcend the mere formulation ofplans and materialize itself into a NationalDecentralized System for ParticipativePlanning.


The endogenous strategy for Good Living re -quires developing societal capabilities andopportunities through the creation of value tosatisfy society’s own needs, as expressed byinternal demand. This strategy enables the for-mation of a virtuous circle in which the econo-my allows the reproduction of life, thesatisfaction of human needs, respect for therights of nature, the increase of added value inproduction, the specialization and developmentof capabilities, the reduction of rent-seeking,extractive practices, and the deployment ofdomestic demand, without ignoring the impor-tance of foreign trade, through Ecuador’s strate-gic and sovereign insertion in the world.

Public investment is one of the main instru-ments of this strategy. It enables savings, capitalmobilization and accumulation in the areas thatfoment productive chains and, hence, achievegrowing production yields.

Similarly, public investment plays an essentialrole in achieving two critical conditions toachieve an endogenous economy: i) compliancewith prior conditions regarding capabilities andopportunities; and ii) capital mobilization andaccumulation in value-generating productivesectors.

To fulfill these conditions, it is important todefine the guidelines for the general planning ofpublic investment, and for its medium- andlong-term progra mming.

9.1. Satisfying basic needsto Generate Capabilitiesand Opportunities

The first condition refers to the need for conso-lidating a critical mass of citizens with capabilitiesand opportunities, the essential components ofGood Living. Public investment must ensurethe supply of essential public services to complywith these prior conditions directed to promotehuman capabilities, such as nutrition, educa-tion, preventive health, housing and basic sani -tation infrastructure, and social security.

9.2. Capital accumulationin Value-GeneratingProductive Sectors

The second condition, systematic capital accu-mulation in value-generating productive sec-tors, is especially vital given the country’seconomic structure and Ecuador’s dependenceon a primary-extractivist export-led model ofgrowth, which leads to capital concentrationand curtails the possibility of developing othersectors that generate more aggregate value.

Three investment categories allow for the newtype of accumulation required in Good Living:

(1) Investment in support infrastructure for sys-temic productivity: generation, distribution andefficient consumption of electricity, production

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9. Criteria for Public Investment


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of bio-energy production; telecommunications,roads, transportation and logistics, I+D plat-forms, strategic research centers related toindustrial and technological parks.

(2) Investment in human capacities and spe-cialization: investigation, science, and techno -logy for innovation, specialized industrialtraining, technical and postgraduate education,technology transfer, etc.

(3) Investment in industries aimed at:• satisfying basic needs: food, textiles and

shoe manufacture, construction (withemphasis on social housing), genericpharmaceutics;

• strengthening food, ener gy and techno-logical sovereignty and reducing thecountry’s vulnerability and dependence:investment in the bio-chemistry sector toguarantee agricultural sovereignty; in oilderivatives to guarantee energy sove -reignty; in hardware and software; inmetal mechanics;

• strengthening the sector of communitytourism and environmental services.

Prioritizing investments that meet these criteriameans promoting change in the model of accu-mulation. These criteria, however, are also use-ful to establish priorities over time, given thefact that compliance with the prior conditionsis a necessary step for capital accumulation tohave the expected positive effects and triggerthe virtuous circle discussed earlier.

In addition to this more long-term vision, prio -rity investments must also accomplish short-term goals, such as create employment, satisfy

basic needs, contribute to systemic productivityin the territories, etc.

9.3. Prioritization Methodologyfor Public Investment

The proposed methodology includes generatingan Investment Priority Index (IPI) that esta -blishes criteria for the allocation of resources atspecific points in time, by considering four mainprinciples:

• Work generation.• Regional equality (based on a satisfied/

unsatisfied basic needs).• Systemic productivity.• Eco-systemic sustainability.

Employment generation is relatively easy toquantify.

Territorial and regional equality is measured byevaluating projects located in the poorest areas(according to non-satisfied basic needs).

Systemic productivity takes into considerationcapital increase, the project’s territorial impact,the contribution to local and national and self-sufficiency, the interrelation between input andproduct, and the contribution to import substi-tution and to strategic sectors.

Eco-systemic sustainability is a criterion thatpromotes and privileges the sustainable use ofnatural resources, practices aimed at environ-mentally responsible production, and the limi-tations of the effect of productive externalitieson the environment.


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11. Acronyms

ADG Autonomous Decentralized Government

AGD Deposits Guarantee Agency

AIP Annual Investment Plan

ALBA Bolivarian Alliance for the Peoples of Our America

AOP Annual Operative Plan Operativo

BCE Central Bank of Ecuador

CEC Ecuadorian Construction Code

CEPAL Economic Commission for Latin America and Caribbean

CISMIL Center for Social Research in the Millennium

(SENPLADES-FLACSO-PNUD)

CODENPE Development Council of the Peoples and Nationalities of Ecuador

CONAIE Confederation of Indian Nationalities of Ecuador

CONAM National Modernization Council

CONAMU National Women’s Council

CONELEC National Electricity Council

DAC Civil Aviation Bureau

DINAREN National Bureau of Natural Renewable Resources

DPT Territorial Planning Bureau

EAP Economiinclinationy Active Population

ENDEMAIN Demographic Maternal and Infant Health Survey

ENEMDUR National Urban and Rural Work, Unemployment, and Subwork Survey

EPN National Polytechnical University

FLACSO Latin American Social Science Faculty, H.Q. Ecuador

FOB Free on Board

GDP Gross Domestic Product

G-20 Group of Twenty (industrialized and emerging countries)

ICSID International Center for Settlement of Investment Disputes

ICT Information and Communication Technologies

IGM Militar Geographic Institute

IG/EPN Geophysical Institute of the National Polytechnical University

IESS Ecuadorian Social Security Institute

IMF International Monetary Fund

INEC National Institute of Statistics and Census

INFOPLAN Planning Information System

IRD Institute de Recherche pour le Développement

ISI Industrialization based on Import Substitution

ITT Yasuní Proposal (Ishpingo-Tambococha-Tiputini)

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IUCN International Union for Conservation of Nature

LCS Living Conditions Survey

LOREYTF Organic Law on Fiscal Responsibility, Stabilization, and Transparency

MAE Ministery of Environment

MCPNC Coordinating Ministry of Natural and Cultural Heritage

MDG Millennium Development Goals

MEER Ministry of Electricity and Renewable Energy

MIES Ministry of Economic and Social Inclusion

MINTUR Ministry of Tourism

MIPYMES Micro, Small & Medium Companies

MPD Movimiento Popular Democrático

MSP Ministry of Public Health

MTOP Ministry of Transportation and Public Works

NSBN Non-Satisfied Basic Needs

NTS National Territorial Strategy

OCP Heavy Crude Oil Pipeline

OELAC Organization of Latin American and Caribbean States

OPEC Organization de Petroleum Exporting Countries

PETROECUADOR Ecuadorian State Oil Company

PLANDETUR National Tourism Plan

PNBV National Plan for Good Living

PND National Development Plan

PNUD United Nations Development Program

POPs Persistent Organic Pollutants

PROMSA Agriculture Service Modernization Program

SELBEN Ecuadorian Social Program Beneficiaries Identification and Selection System

SENAGUA National Secretary of Water

SENPLADES National Planning and Development Secretary

SIGAGRO Geographic Information System for the Agro-Cattle Raising Sector

SIISE Integrated Social Indicator System of Ecuador

SISPAE Indicators System for the Afro-Ecuadorian People

SNAP National Protected Area System

SPPP Subsecretary of Planning and Public Policies

SSI Selectiva Substitution of Imports

TUS Time Use Survey

UNASUR Union of South American Nations

UNESCO United Nations Educational, Scientific, and Cultural Organization

UNICEF United Nations Children’s Fund

UPA Agricultural Production Unit

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Plan Nacional para el Buen Vivir (inglés)

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