Saturday, 16 March 2024 14:11 89
Category: Local News
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Matthew Bristow and Stephan Kueffner

Why is Daniel Noboa so popular even after he raises taxes ?

Ecuador’s 36-year-old President Daniel Noboa is overhauling the nation’s economic model in a way that would likely trigger rioting in normal times. But times aren’t normal. The country has been transformed from a stable corner of Latin America into a borderline failed state with a six-fold surge in homicides over five years and the inability to pay government workers on time.

It’s the kind of opportunity most leaders can hardly fathom: voters rallying behind a government that is raising taxes, clearing the way for more oil drilling and planning to slash fuel subsidies.

Ecuador’s 36-year-old President Daniel Noboa is overhauling the nation’s economic model in a way that would likely trigger rioting in normal times. But times aren’t normal. The country has been transformed from a stable corner of Latin America into a borderline failed state with a six-fold surge in homicides over five years and the inability to pay government workers on time.

Since Noboa took office in November, he has declared war on cocaine cartels while also battling to prevent a financial meltdown. The security crackdown’s early success has made the US-educated son of wealthy banana exporters one of the world’s most popular leaders, with approval ratings approaching 80%.

In recent weeks, Noboa pushed through an emergency tax bill that raised the value-added-tax by three percentage points to 15%, and greenlit thousands of environmental permits for oil and mining companies — moves he said will help shore up the economy as well as government coffers. He’s also planning to reduce gasoline subsidies and liberalize the labor market to make it more employer friendly.

With his focus on gangs and use of emergency powers, Noboa appears to be following the playbook of El Salvador’s Nayib Bukele, one of the few leaders in the world more beloved than he is. Bukele, confronted with a similar surge in crime, became a regional hero by using mass arrests, a suspension of civil rights and the construction of one of the world’s biggest prisons to suppress gangs — all policies that Noboa is adopting.

But while the US holds Bukele at arm’s length, condemning his flouting of term limits and human rights, Noboa is getting significant help from Washington. The US was so alarmed by the nation’s plunge into chaos that it dramatically increased assistance, making Ecuador the second-biggest recipient in Latin America, after Colombia, of funds from the State Department and the Department of Defense to bolster security.

US authorities have another reason to want a stable Ecuador: The bloodshed has set off a wave of migration, with Ecuadorians now the second-biggest nationality among travelers walking through the Darien Gap on their way to the US.

Of course, there’s the risk that crime starts to rise again as the gangs adapt to the new reality. Already, the army has returned day-to-day management at some prisons to the same government agency that previously lost control of them to the inmates. And the cartels have been biding their time, knowing that the state of emergency has a legal limit of 90 days, which will expire in April.

“I’ve been robbed many, many times, but now I’ve seen security improve a lot,” said Elvis Benavides, who works as an informal taxi driver in Duran and Guayaquil. “I hope it continues. I’d vote for him if he runs for reelection.”