Ecuador’s Moreno Struggles to Meet IMF Targets After Fuel Clashes

Two weeks of protests and clashes, in which seven people were killed and 2,500 injured or arrested in the centre of Quito, have forced Ecuador’s President Lenín Moreno to rip up his economic reform plans, leaving him in a weaker position than ever before, the Financial Times reported. Faced with the demands of a $4.2bn IMF programme, the Ecuadorean leader needs to either cut government spending or raise revenue. His plan to abolish fuel subsidies, which triggered the mass protests, would have saved the state $1.3bn a year, or 1.2 per cent of gross domestic product. Perhaps with the failure of Mauricio Macri’s gradualist reforms in Argentina in mind, Mr Moreno opted for a “short, sharp shock” strategy — scrapping overnight subsidies that had been in place for 40 years. Read more