ECUADOR AND EMIGRATION
Bahia de Caraquez, Ecuador, 04 September 2006

The following article is the first of what may become a series on topics of interest to us in our travels through Latin America. They should be appearing in a small Canadian progressive journal.


Ecuador & Emigration

Ecuador: that endlessly interesting and beautiful South American country about the size of Tennessee and with a population about half of Canada’s. Tourists are guaranteed fabulous landscape and portrait shots in the high Andes, in the jungle headwaters of the Amazon, along sandy Pacific beaches or in the Galapagos.

Look behind the scenes, however. By official tallies, Ecuador lost over 8 percent of its work force and 4.2 percent of its working-age population in the period between 1993 and 2001, when the last census was taken. In a May 4, 2002, editorial in El Comercio, a nationwide quality newspaper, journalist Angel F. Rajos estimated that Ecuador had already in fact lost about twenty percent of its population to migration. The numbers of emigrations may have declined somewhat for the reasons given below. But the numbers people trying to get out are still substantial. Some rural Andean villages seem to be swept clean of men. If asked, the women tell you that the men are all living in New York City. What’s going on?

The conventional wisdom is that dirt-poor men have left wives, children, barren farms and peonage to sail to America and a brighter future. The truth is a little different.

Large migration flows have push and pull factors. Wars drive people out - Eastern Europeans fleeing the Red Army at the end of WWII, for example. Famines push people to new areas to find food. Pulling them are factors like physical safety, food, free land and job opportunities. The more the factors move away from actual starvation or threat to life and limb, the more emigrants look like “economic refugees”. What’s Ecuador’s story?

The country is not large but it has been, by Third World standards, relatively prosperous and politically stable in the past. Even now, CIDA, the Canadian International Development Agency, categorizes Ecuador as “low-middle income”. That is one reason why Canada provides next to no aid to the country (that and the fact that Canada is nowhere near meeting its stated foreign-aid goal of 0.7 percent of GDP). Also, there are many poorer countries in Africa; Ecuador has petroleum, after all, and is now one of South America’s important oil exporters. Nearly all of it goes to the U.S.A. The Oriente Province at the headwaters of the Amazon is said to contain immense reserves. Ecuador is also the leading shipper of bananas worldwide, it grows roses and other cut flowers for export and it farms shrimp for sale to First-World countries. Surely Ecuador could work its way out of poverty.

In the 1980’s and 90’s, mortgaging future oil revenues, Ecuador shouldered a heavy burden of debt. When petroleum prices took a nosedive in the eighties and nineties, onerous principle and interest payments had to be met out of declining oil revenues. Even today, with oil prices much higher, Ecuador’s international debt is the one of the highest in the world: debt service in 2001 was running at over 89 percent of the country’s Gross National Income.

Government-provided services were pared back: roads, government buildings, health care, education and pensions began to deteriorate and, in 1998/99, there was a major banking crisis. By any ranking, Ecuador’s overall quality of life had sunk to the bottom of every Latin American table. Everybody was hurting, and the numbers under the official poverty line soared, faster in the cities than in the country, higher for indigenous peoples than for the others. Of course, cuts like these hit populations unevenly. Despite its apparent tranquillity, Ecuador has a lot of ethnic, class and economic tensions smouldering beneath the surface and, under economic pressure, a lot of political turmoil has bubbled to the surface in the country.

Behind the economic mismanagement – and Ecuador is by no means alone in this; think of current US administrations! – there are some other factors to be added to the mix. Unlike Canada and the U.S.A., for example, Ecuador is a pure resource cum export economy: its flexibility is therefore severely circumscribed. It doesn’t help that the public administration here is also amongst the most venal and corrupt in the world. The country’s birth rate has also remained at traditional highs while infant mortality rates have dropped. Effective birth control on a meaningful social level would require a major public-health campaign. But family planning is no more a top priority in a solidly Roman-Catholic land than in countries dominated by fundamentalist Christians. With the social security net so unreliable and covering by no means everyone, children are not only a joy, they are a support in old age. You see the results everywhere in Ecuador: lots of very young mothers and fathers with lots of tots. Thirty-three percent of the population is under the age of fifteen (Canada: 18%; U.S.A.: 21%).

Thirty-five percent of the population is rural. A few wealthy families own most of the land in Ecuador while the many work tiny farms. Joy or no, since the little farms are generally not able to support large families, it makes sense for young men and women to head for the cities of Quito (1.6 million) or Guayaquil (2.6 million) even if it means living a mean existence in the barrios. You see the effects everywhere in the cities too: swarms of shoeshine boys; quasi-beggars – many of them indígenas –selling chicklets on the street; young and old men and women hustling to sell you sweets, crisps, and even quack medicines on the busses; streets full of elderly blind people singing for centavos.

Overpopulation, therefore, along with unemployment/underemployment and poverty has been fuelling a flight from the land. Some of these now rootless rural people keep right on going to sub-rosa jobs in Colombia, Venezuela, Chile and Peru. A few even make it to North America and Europe.

Interestingly, however, it has not only been the campesinos that have made it to New York and Madrid. In the country you become poorer and poorer in terms of whatever yardsticks are used internationally to measure these things. There is not enough opportunity - but you might just still have a chance to eat but you will not be able to afford to raise a family. From that point-of-view, it is like being a labourer in Los Angeles. The economic malaise and especially the banking collapse of the late nineties, on the other hand, hit the trained and or educated middle classes in the cities the hardest. By 1999, when it was decided to abandon the nearly worthless Sucre and to adopt the U.S. dollar as the national currency, near-hyperinflation had wiped out two-thirds of the nation’s banks. Overnight, middle-class savings along with small-business, job-creating credit disappeared.

The banking crisis impacted nearly two-thirds of all households and nearly all businesses. Accounts were frozen to prevent runs on the banks. When the economy had finally been stabilised, the government had been shaken badly by an attempted coup (blocked by the military), the president had gone into exile, businesses had failed on a massive scale, employment opportunities had shrunk drastically and the urban middle class had essentially been wiped out. The banking crisis, fuelled by the greed and corruption of banking executives, had cost Ecuador somewhere between $ 2.5 and $ 4.0 billion (23%-34% of GDP), and this does not even include the cost to the public of frozen accounts and lack of business financing. With the flight from the land to the cities still in progress, the exodus to foreign shores by the skilled had been set in motion.

It surprises nobody in Ecuador to learn that the bankers had been feathering their own nests along with those of its cronies in politics and commerce. Recall the S&L debacle or Enron and resist a condescending sneer. The really big depositors could keep their monies in overseas accounts and so were largely protected. But smaller savers, people on the bottom or middle rungs of a shaky economic ladder, people relying on current income rather than inherited wealth, found themselves dumped rudely back to the ground, bruised and bitter. Under such circumstances, it is Amore than rational to consider heading for more prosperous shores. As uneducated farm workers poured into the cities, therefore, the well-educated, energetic and job-mobile middle class left the country for better opportunity.

At first, the United States was fairly welcoming to Ecuadorians. There are after all many small colonies of Ecuadorians dotted around the country. Soon however, feeling threatened by the inflow of immigrants from other Western Hemisphere countries, the gates began to swing shut. Of course, Mexicans make up the bulk of immigrants to the States: Mexico is the U.S.A.’s nearest and most populous neighbour. And nearly every country in Central and South America has been losing citizens abroad; Ecuadorians are just a drop in the bucket. But, there are said to be half a million Ecuadorians in New York City.

With American doors closed, Ecuadorians have been reacting in two ways: on the one hand they try to get in the U.S.A. illegally while, on the other, more and more Ecuadorians now head for the European Union. Spain and, secondly, Italy are natural choices. By 1999 it was estimated that there were some 380,000 Ecuadorians in Spain alone.

Ecuadorians are still trying to get into the U.S.A., of course. More recent figures are hard to get. But, in a study by the US Census Department in 1996, there were already some 5 million undocumented immigrants living in the U.S.A., representing just fewer than 2 percent of the population. Nearly all came from the Western Hemisphere. Sixty percent of the illegal aliens were Mexicans who were living mainly in border states like California and Texas. There were also, however, 55,000 Ecuadorians living and working illegally in the U.S.A., many of them in New York and New Jersey. (Ranking fourth on the list were also 70,000 illegal Canadians in the U.S.A.)

The number of illegals will surely have increased since 1996. For those trying to get in, the risks and the costs have risen astronomically – to about three or four times the average annual income for Ecuadorians. Last year a boat full of Ecuadorians sank with a loss of 95 lives on the way to Guatemala as a first step on the way to Mexico and thence illegally across the US border. Each passenger had paid $10,000 to “coyotes” to get to America. To get the cash together, individuals borrow money from family and friends to be repaid, they hope and believe, by money sent home. Every month the papers report the young corpses washed up on the beaches when a launch capsizes offshore; the newspaper photo of an indigenous woman in her native costume, walking the beaches looking for some sign of her missing 18-year-old grandchild, is hard to banish from your night-thoughts.

So the flow of emigrants became more oriented to Europe around 1999. While some poor campesinos may also be included, the biggest numbers have been middle class and better-educated people. And, for the first time, women have been nearly as numerous as men: Spain and Italy want household domestics and farm workers. Social workers, the church, and the government in Ecuador are still trying to assess the social and psychological costs of small children being left with relatives while one or both parents head for Madrid or Newark. No one can accurately calculate the economic costs of this migration.

In 2003 the European Union also started raising its immigration barriers. Even Latin American countries that once routinely gave out six-month tourist visas at the border now refuse any visas to Ecuadorians as a matter of principle. At present only neighbouring Colombia and Peru permit Ecuadorians to enter with just an ID card. At the anecdotal level, you can meet persons who, despite solid incomes, jobs or small businesses in Ecuador, cannot get visas even to visit family members already legally in the U.S.A. or Europe. So, those who did not join the stampede are now either “trapped” in Ecuador or are faced with usurious rates and huge physical risks to be people-smuggled.

There may be some benefits in this sad tale, however. As the working population downsizes through emigration, the unemployment rate in Ecuador has also fallen. It is now down to about 10 percent - not far, in fact, from the unemployment level in unified Germany. More importantly, Ecuadorians working abroad send money back home. Remittances are now the second largest source of income after petroleum revenues in the country’s foreign exchange balance. (Loans and aid grants are the third largest; other export earnings – fruit, flowers, shrimp, for example - are fourth.)

While pull factors are now weaker as walls go up in more prosperous countries, the push factors at home may be diminishing as well. With the “dollarisation” of the Ecuadorian economy and the resultant stabilisation of the economy, inflation has declined (it is now lower than in the U.S.A.). If the drain of revenues by corrupt officials can be curbed, recent large increases in petroleum prices may give the country some room to breathe, deal with its overseas debt situation, do some work on the infra-structure (roads, harbours, etc.) and spread some largesse to the population generally.

Push and pull factors (including administrative barriers to emigration) may therefore have caused emigration from Ecuador to slow in the past year or two. It is difficult to get a handle on the numbers because of the underground-railroad aspects of emigration. Certainly most of Ecuador’s economic and social problems have not been solved. But, unless they can pull together the money needed to be smuggled into Spain or the U.S.A., potential emigrants will have to stick it out at home. Ecuadorians are still unconvinced and nervous, however. A presidential election will take place in October. Maybe that, too, will help.