Crisis and Coup in Ecuador

Against the Current, No. 87, July/August 2000

Lynn A. Meisch

ON JANUARY 21, 2000, FOR the first time since the Spanish conquest of Ecuador in A.D. 1533-34, indigenous people briefly — very briefly — ruled the country as part of a triumvirate.

Frustrated by over a decade of economic problems, corruption and political stalemates over indigenous rights and land disputes, thousands of indigenous protesters and members of popular movements converged on Quito, the country’s capital. On the 21st, hundreds of protesters occupied Congress and proclaimed a People’s Parliament.

Three men then formed the Junta of National Salvation: Antonio Vargas, President of the national indigenous federation CONAIE (Confederation of Indigenous Nationalities of Ecuador), Army General Carlos Mendoza, and former Supreme Court Justice Carlos Solórzano, forcing the resignation of Ecuador’s President Jamil Mahuad in a bloodless coup.

The junta was backed by a group of young army officers headed by Colonel Lucio Gutiérrez, a hero of the 1995 border war with Peru. Within hours, buckling to pressure from the United States and some regional commanders, General Mendoza betrayed the junta and turned power over to the country’s Vice-President Gustavo Noboa. On January 22nd, Noboa became Ecuador’s fourth President in three years. (These events are captured in a dramatic video by Selmeski 2000.)

Why did the uprising occur and then fail? Ecuador, a country about the size of Oregon with 12.4 million inhabitants, of whom nearly two-thirds live in poverty, is known for the strongest indigenous rights movement and the weak<->est economy in Latin America. Both factors contributed to the January uprising.

The Indígenas As Social Actors

Like most Latin American countries, Ecuador is still struggling with the legacy of colonialism, including centuries of de jure and de facto subjugation of its indigenous and African-Ecuador inhabitants. Ecuador’s indigenous people, today 30-40% of the population, began forming unions to work for land and labor rights early in the 20th century, but because many of these were Communist- or Socialist-inspired, they had trouble attracting widespread support and were vulnerable to government crackdowns.

The more politically effective federations were founded in the 1960s and 1970s, many with the help of the Roman Catholic Church. For example, the Shuar Federation in the Oriente (Amazon rainforest) was founded in 1964 with the help of Salesian missionaries.

Until 1964, indígenas (as they prefer to be called) in the Andean highlands were caught in a systems of debt servitude including wasipungu, the right to farm a small plot of land on an hacienda in return for onerous labor obligations. Such laborers and their families could be bought and sold with the hacienda, and people today still tell horror stories of life under this system.

Under pressure from the United States, which was afraid of Cuban-style revolutions in the Andes, Ecuador enacted an agrarian reform law in 1964 that freed debt-laborers, redistributed some land and attempted to handle the inequalities in land distribution by settling colonists from the highlands in the Amazon rainforest.

Once freed from wasipungu, many indigenous communities made concerted attempts to educate their young, some opting to teach their children Spanish in lieu of Quichua, the indigenous language. This first cohort of educated indígenas has played a significant role in indigenous organizing.

Throughout the 1960s and 1970s, a variety of federations organized at the community, provincial, and regional levels, independently and under religious auspices. In 1980, most federations united in a national umbrella organization that ultimately became CONAIE.

In late May 1990, CONAIE staged a nation-wide uprising that knocked Ecuadorians’ stereotypes of indígenas — as backwards and unsophisticated — into a cocked hat. The strike was coordinated and disciplined and completely shut down the country through such tactics as the blockade of major highways and feeder roads. Ultimately, the flow of food to the cities was so completely cut off that urban dwellers suffered severe shortages.

Thousands of indígenas, wearing their finest traditional dress, converged on Quito and occupied one of the main churches. They refused to leave until the Catholic Church mediated a summit with the government. Such indigenous leaders as Luis Macas of Saraguro proved to be articulate spokespersons, skilled at using the media to present indigenous concerns — including the settlement of outstanding land disputes. Demands for land reform and the protection of indigenous territory remain among CONAIE’s most pressing concerns (León and Rappaport 1995, Meisch 1992).

The April 1992 march from Puyo in the Oriente to Quito, the October 1992 opposition to the Columbus Quincentennial, and the June 1994 uprising over land and water rights also brought indigenous concerns to national and international attention. These concerns were reformist rather than revolutionary and included cultural as well as political and economic demands: for example, recognition of traditional healing, bilingual (indigenous language-Spanish) education, control over archaeological excavations on indigenous land, a recognition that indigenous groups are “nations” with spiritual ties to their land, and appreciation of traditional indigenous dress.

CONAIE, while invoking identity politics, has been adept at creating alliances with other progressive groups including those whose membership is predominantly white-mestizo: labor unions including petroleum workers, civil servants, teachers, and transport workers.

In early 1996, indígenas formed a social movement, the Movimiento Unidad Plurinacional Pachakutik (S. Plurinational Unity Movement Pachakutik, the latter a Quichua term meaning a world or time-space reversal). Luis Macas, former president of CONAIE, was elected to Congress as a national representative on the Pachakutik ticket, a historic first.

In the May, 1998 elections indigenous candidates were elected to local and regional offices in record numbers throughout the country. An Otavalo indígena, Nina Pacari, was elected a national congresswoman, and then selected a second vice-president of Congress — the first indigenous woman so chosen. She was also a representative to the 1997-98 national assembly that rewrote Ecuador’s Constitution.

Article I of Ecuador’s August 10, 1998, constitution declares the country a democratic, pluricultural, and multiethnic state, with “castellano” (Spanish) as its official language, and “quichua, shuar” and other “ancestral languages” official for use by indigenous communities, a recognition that indígenas define themselves as distinct in a number of ways, including language, dress, healing, and other customs. This is not Balkanization; indígenas see themselves as indigenous Ecuadorians or Ecuadorian indígenas, with emphasis on both words.

These indigenous victories were beyond the imagining of even the most prescient observers. I have conducted research in Ecuador since 1973, and never expected to see indígenas play such a powerful cultural and political role in the affairs of the country.

The Economy: From Bad to Disastrous

While the indigenous rights movement surged, the 1980s saw the standard neoliberal structural adjustments that have been pushed by the International Monetary Fund (IMF) and the World Bank, including reduction of state subsidies, opening of markets, and privatization of state enterprises.

The standard of living dropped, especially for the poor (of whom a large portion are indigenous). For example, between 1982 and 1993, public spending on education dropped from 5.1% to 2.7% of the national budget and health from 2.2% to .7% (Brysk 2000: 150-151).

The situation was exacerbated by rampant corruption and the complete inability of the government to collect taxes; it relies instead on oil revenues for 50% of its income, despoiling its Amazon rainforest and displacing indigenous people in the process.

The 1990s, particularly the second half of the decade, witnessed a series of natural disasters of biblical proportions, which coupled with continuing corruption, political mismanagement and a costly border war with Peru, plunged the country deep into recession.

The country suffered droughts which crippled its hydroelectric power and resulted in electrical outages and rationing. The eruption of two volcanoes located near major population centers and a catastrophic landslide in Azuay province wiped out whole communities and caused serious flooding. 1998 was particularly bad, with El Niño doing damage to the tune of $2.6 billion at the same time that prices dropped for Ecuador’s main exports (petroleum, bananas, shrimp, coffee and cacao).

Inflation, which averaged 40% annually between 1984 and 1998, the highest in Latin America, reached 88.9% between April 1999 and April 2000. The general chaos also wreaked havoc with tourism, which normally ranks as Ecuador’s fourth or fifth main source of revenue (depending on the price of coffee and cacao).

In 1997, half of the 200 highest-earning Ecuadorian corporations paid no income taxes (Yahoo! News, Wednesday, August 26, 1998). This is no great surprise. In 1998, Transparency International in Berlin ranked Ecuador among the most corrupt countries in the world in terms of the bribery of government officials (Bloomberg Personal Finance 1998: 5).

The resulting lack of confidence in the government has exacerbated social tensions and interfered with the ability of the state to arrive at political compromises with CONAIE and other groups.

In 1999, Ecuador experienced its worst economic crisis in seventy years, facing a $1.2 billion budget deficit, a plummeting sucre (the national currency), bank failures and the freezing of accounts in March, as well as rampant inflation, and a series of strikes, and national uprisings in March and July involving all sectors of the population.

As bankers fled the country with their depositors’ funds, Ecuador’s Central Bank pumped out more sucres, contributing to the hyperinflation. Then U.S. Ambassador to Ecuador, Leslie Anderson, publicly called the bankers’ behavior “repugnant.”

The bank failures and freezing of accounts precipitated a steep decline in both the average citizen’s ability to cope with rising prices and the government’s ability to govern. Parents could not make house payments or buy food for their families, students couldn’t withdraw their tuition money, elders had no access to their savings for medical care or even groceries, businesses could not buy raw materials or meet payrolls.

The economic collapse has had a ripple effect of the worst possible kind, including an increase in crime, social unrest, human rights abuses by the police and the apparent emergence of right-wing para<->military death squads.

A strike in March, 1999, over austerity measures was followed by another four months later. The July, 1999 strike was triggered by President Mahuad’s announcement that he would raise gasoline prices substantially, which precipitated an outbreak of what Ecuadorians call “yellow fever.”

Taxi drivers throughout the country refused to work and parked their yellow cabs in major intersections in the country’s cities and towns, completely stopping traffic. CONAIE voted to support the strike and was soon joined by other unions and social movements.

When the leadership of CONAIE calls for an uprising, its constituent federations do not follow blindly; local communities vote whether to join the strike. In Otavalo, where I sat out the two-week July strike, most communities went out, but some did not.

The net effect, however, was the complete paralysis of the region. Large groups of indígenas and their allies including the taxi drivers rolled boulders across major arteries and blocked intersections with bent nails and burning tires.

No traffic moved; groups of indígenas armed with sticks and clubs surged through Otavalo ensuring that all businesses and government offices were closed. The normally bustling food market and Poncho Plaza (the crafts market) were completely deserted. These scenes were typical of all national uprisings since 1990.

Meanwhile, indígenas converged on Quito, including a women’s march. In Otavalo a group of several hundred women, led by Blanca Chancoso, a longtime activist, left the main plaza for the four-day, sixty-five mile, mountainous trek to Quito, where they were greeted with a tear gas bombardment by police at the entrance to the city.

After two weeks of mounting economic losses, President Mahuad rescinded the price hike. But why did he bend to IMF pressure and announce such a large hike to begin with; why did he wait two weeks to back down?

A significant feature of the decade’s strikes and uprisings is the relative lack of violence by both the protesters and the government. Unlike the state response in many Latin American countries, in Ecuador the government has not automatically ordered the military to fire on protesters. There seems to be an unwritten social contract that both sides will observe certain rules. For example, indigenous leaders I interviewed have insisted that their tactics would never include an armed revolt.

Finally, in the fall of 1999, Ecuador committed a cardinal sin by partially defaulting on its staggering $13.6 billion foreign debt.

Fully 50% of the government’s income goes to servicing this debt, a good argument for such programs as Jubilee 2000, which advocates debt reduction or forgiveness for the world’s poorest countries and a complete redefinition of global financial relations. Ecuador ended 1999 with a contraction of its economy by 7.5%.

A major factor in the January, 2000 coup, besides the woes already mentioned, was President Mahuad’s plans for “dollarization.” The idea was to replace the sucre with the American dollar at an exchange rate of 25,000 to the dollar.

Dollarization is not unprecedented in Latin America: Panama has used the dollar for more than a century and Argentina pegged its peso to the dollar at a one-to-one rate in 1991.

Mahuad’s rationale was that this would halt runaway inflation. True, Ecuador’s Central Bank has been completely indiscriminate with the money supply. Bankers send hundreds of millions of stolen funds out of the country? Print more sucres. Politicians do the same? Print more sucres. This is no way to run an economy.

On the other hand, for many Ecuadorians the move smacks of neocolonialism and a loss of sovereignty. Moreover, given the dismal record of government honesty, many fear that dollarization will mean more aggrandizement of the rich at the expense of the poor. CONAIE and the unions are strongly critical of dollarization, arguing that it will further impoverish the majority of Ecuadorians.

Indigenous-Armed Forces Relations

Word has now leaked in Ecuador that CONAIE and the military were engaged in secret discussions in the months prior to the January uprising. What is uncertain is exactly who was asking whose help with what.

Were both sides reaffirming their intention to keep confrontations as non-violent as possible? Was the military proposing a coup and offering CONAIE a partnership? Or was CONAIE suggesting that a military or a military-CONAIE-civilian alliance and coup was the only possibility for restoring order and confidence?

Relations between the military and the civilian population in Ecuador are unusual in Latin America. Following the 1990 uprising, the Ecuadorian military embarked on an extensive program of community development in the highlands (Brysk 2000: 136-137). During the April and October 1992 marches on Quito, the army accompanied the marchers and supplied them with food, medicine and an ambulance (Meisch 1992, Whitten et al. 1997). Clearly this has done much to establish an atmosphere of trust.

The Aftermath of the Coup

Now, back to January 2000. Immediately after the failed coup, 117 junior officers were arrested and charged by military tribunals. On March 29, Vargas, Solórzano and two leaders of the Izquierda Democrática (Democratic Left) party, Paco Moncayo and Rene Yandun, were charged with “attempts against the security of the state” and removed from Congress. Public opinion, however, favors an amnesty for all involved.

President Noboa announced that he would continue Mahuad’s dollarization plan, with the dollar replacing the sucre for everything but small purchases by July 2000.

In April, the IMF agreed to another bailout loan, with stringent economic requirements that, once again, may not be politically possible. The measures include privatization of half the government’s holdings (including telecommunications, electricity, shipping, airlines, water purification and petroleum).

The political fallout from the coup continues. In early May, Noboa’s government asked Congress to pardon those involved in the coup. Shortly thereafter, the heads of the Joint Chiefs of Staff, Navy and Air Force resigned because of their opposition to the amnesty.

Noboa’s approval rating remains high — between 45-50%. Many Ecuadorians seem to be willing to give him a chance to get the country’s house in order. Noboa decided to involve scholars in the process of rebuilding a political consensus. He asked the Carter Center in Atlanta to provide academics familiar with Ecuador to investigate and help find solutions for corruption as well as to mediate with CONAIE and the provinces on the coast demanding autonomy.

The question is whether Noboa can hang on long enough to effect any changes. CONAIE has launched a campaign to obtain a million signatures in opposition to dollarization. In mid-May, Ecuador’s major unions commenced an indefinite general strike, asking for pay raises and a halt to dollarization. Public school teachers joined the strike. Now earning $65 a month, they are asking for $100. Civil servants, oil workers and hospital workers have also joined the strike.

The country is bracing itself for another gasoline price increase. Planned for July 1st, the raise could topple Noboa’s government. Apparently he intends to announce an economic package to help the poor prior to that, but it may be too little too late.

The question is whether everyone’s worst fears will be realized and a right-wing, repressive military coup will result — with the armed forces arguing that the militarization of the country and the suppression of civil liberties is the only way to maintain law and order.


Brysk, Alison, From Tribal Village to Global Village: Indian Rights and International Relations in Latin America (Stanford: Stanford University Press, 2000).

León, Jorge and Joanne Rappaport, “The View from Colombia and Ecuador: Native Organizing in the Americas,” Against the Current 59. Vol. X, No. 5, November-December 1995, 27-32.

Meisch, Lynn A. “We Will Not Dance on the Tomb of Our Grandparents”: 500 Years of Resistance in Ecuador, The Latin American Anthropology Review. Vol. 4, No. 2, Winter 1992, 55-74.

The Prevention of Intractable Inter-Ethnic Violence in Contemporary Ecuador (Stanford University: Stanford Center on Conflict and Negotiation Working Paper, 1997.

Selmeski, Brian R., Imágenes Impresionantes: el levantamiento indígena-militar ecuatoriano. Video distributed by Latin American Video Archives, 2000, 30 minutes.

Whitten, Jr., Norman E., Dorothea Scott Whitten and Alfonso Chango. “Return of the Yumbo: The Indigenous Caminata from Amazonia to Andean Quito.” American Ethnologist 24 (2), 1997: 335-391.

ATC 87, July-August 2000