I didn’t say it, but…

I didn’t say it, Abraham Lincoln did: “CAN NOT PUT FORWARD the brotherhood of

man, encourage, HATRED OF CLASS”.

I didn’t say it, Carlos Montaner did: “Enjoy political and economic freedom”. Liberty

doesn’t emerge from property, but all the way around. Prosperity is the result of liberty.

Without political liberty it’s imposible to examine societies problems, correct mistakes,

punish the guilty and select the best. Without ecomic liberty, individuals creativity drowns,

producction processes degrade and privileges go to the courtlike with decisions against the

ones who have merit”. “Protect private property”.- Access to private property is a right

linked to the liberty existence. Without private property people are at the mercy of the

tyranny of powerful groups or of collectivity. Without private property not even rebelion is

possible. Without private property economc development is tremendously ineficient. The

arbitrary confiscations and the owners insecurity are one of the causes for poverty.”.

I didn’t say it, but the Chileans did: “Public-Private Association in all the sectors; The

public system supports everything which is done by the private sector”.

I didn’t say it, but Eloy Alfaro did: “Men who are indifferent to nation’s misfortune, even

if they are privately hardworking, are the unconscious assistants of people’s misfortune and

corruption”.

I didn’t say it, but 2000 census cyphers did: “That the indigenous population is the

6.83% (830.418 Ecuadorians); the afro Ecuadorians, the 2.23% (271.372 Ecuadorians); the

mulatto, the 2.74% (332.637 Ecuadorians); the white, the 10.46% (1.271.051 Ecuadorians),

and the mixed race, the 77.42% (9.411.890Ecuadorians)”. Therefore, if I say that what

nowadays is happenning it’s because the minorities are making us slaves because the

great majorities are mummified. We have to begin changing things because we can’t

allow to move back 50 years. Confrontations don’t drive us anywhere; it’s unbelievable that

we had to watch hurches attacks for defending life, family and education.

! WE NEED TO FORTIFY DOLARIZATION, THE FAIR PLAY, THE

GENERATION OF WORK POSTS, THE FAMILY AND LIFE

IT’S ENOUGH

WE HAVE TO SAY: NO to INFLATION NO to CORRUPTION, NO to

UNEMPLOYMENT, NO to HARASSMENT, NO to DISCRETIONAL ATTITUDES.

Ing. Joyce Higgins de Ginatta

Guayaquil,August 2008

Ecuador can only fight inflation having lesser extent of

spending

Mr. Luis Oganes

General Manager, Chief of Economic Investigation for Latin America

JP Morgan

World’s economy is confronting two obvious problems, which are; less growth and higher

inflation. Even if the recession risk is the greatest concern in developed countries –

particularly in USA, Western Europe and Japan- and in some emerging economies which

especially depend on exporting their growth, the main concern nowadays is the inflation

acceleration. Without doubt, even if the emergent economies are also beginning to

decelerate, that isn’t happening with the required magnitude to hold back the inflation

pressures. Therefore the annual average inflation has almost been doubled in the last 18

months near to 8%, and the great majority of central banks won’t be able to achieve for the

second consecutive year, their inflationary goal for 2008.

Even if the world prices referring to agricultural products and oil in the last weeks have

dropped, it is possible that the inflation internal shock is over, which would help to reduce

inflation during the coming months; there is a tendency in emerging economies to be

worried about by the day. The underlying inflation, which excludes prices for food and

electricity have also begun to accelerate annually, from 2.4% in January 2007 to almost 4%

to the first half of the present year. In other words if few months ago we could blame the

highest inflation to foreign international price increase of raw materials, now inflation is

also impelled by domestic factors. If economic authorities aren’t able to control those

pressures, it will be very difficult in the future to reduce inflation, especially if expectations

for more inflation turn to be permanent and generate higher demand for salaries.

This complicated inflationary dynamic is more evident each time in Latin America. Even if

the food price increase which is more than 50% of the regions accumulated inflation during

half of 2008, a lot higher of the basic food basket average towards the consumer of 27%,

the electricity price increase was limited and even negative in some cases because of

subsidies which eventually should be abolished because of its high fiscal cost. The fear

about the inflationary expectations which continues deteriorating because of underlying

inflation increase, is forcing Latin American central banks to raise their interest rates, in

countries in which the GIP is higher than the potential long term (Brazil, Peru) or also the

ones in which its lower (Chile, Mexico).

Ecuador’s case doesn’t get away with the regions alarming tendencies. Even if July’s

monthly inflation rate (0.59%) was the lowest of the year, the annual rate rose to 9.88% and

it’s probable that it will exceed the two digits in the months to come, something which

wasn’t seen since the beginning of 2003. At the same time, even if the food monthly

inflation rate registered in July (0.76%) was the lowest since past October, the annual food

inflation rate reaches almost 20% and explains the 70% Ecuador’s inflation. Something to

be worried about are the prices associated to health, communications, restaurants and hotels

among others, which are also accelerating the inflationary effects of second order which

can be seen with much more strength.

The big question in Ecuador’s case is what can be done to fight inflation because the option

to adjust to the monetary policy doesn’t exist in an economy with the dollar as its currency.

A similar dilemma are having other countries which still haven’t got the dollar as their

currency but they strongly take part to maintain stable the exchange rate in front of the

dollar, such as a great emerging part of Asia and the group of Arab countries in the Persian

Gulf. Some of them are beginning to allow their currencies appreciation to hold back the

inflationary pressures. As this alternative isn’t available for Ecuador, at the end the only

valid strategy to reduce inflation would be the one of reducing the public spending.

Lamentably, this for sure will be impossible in a political way, in which the government is

trying the new Constitution to be approved through a referendum in which the GIP growth

is low (even if the BCE hasn’t published official ciphers of growth since last year’s third

trimester, it is estimated that the GIP grew less than 2% in 2007 and it isn’t likely to expect

exceeding of 2.5% in 2008). All the above mentioned makes us believe how difficult it will

be to decelerate inflation for the rest of 2008, which could possibly reach 10%.

Cotacachi: Tourism and development

Mayor Auki Tituaña, local municipal administrator of Cotacachi, has marked its

development when it was declared “a city free of illiteracy; a city free of infant

mortality which is a demonstration of excellent work towards birth and pre birth

care; a city of peace in which many races and cultures converge”.

Tourism is the core for economic development in Cotacachi, activity which brings together

agriculture and rural organizations. Around 150 natural and cultural attractions have been

identified, which is an important potential to be exploited.

Mayor Tituaña says that there will always be in a conceptual way, differences between eco

tourism and rural tourism. However, being Cotacachi a town council with diverse ethnics

and environments, all the work is done under this perspective so the whole community will

benefit in an organized way of: its strategic location, near the capital (Quito with 60 Km in

straight line); being in the centre of a very tourist province such as Imbabura; and to take

advantage of the craftworks and agricultural opportunities.

Agricultural tourism,! A new opportunity!

There are around 300 producers which are directly connected to an Association of

Coffee Craftworks called “Rio Intag”. The objective of this process is to fight in some way

the threaten of Cotacachi’s mining industry, especially because it is a cushion zone for the

Ecological Reserve Cotacachi-Cayapas and because it’s also a region of primary rainforest

which without doubt produces much water and important unique bio diverse resources in

the planet. Organic coffee production at integral vegetable gardens and orchards takes place

at approximately 1.600 m above sea level. “Arabic Coffee in the market has turned into one

of the most desirable products for Japanese, Spanish, French, North American and Italian

countries, to which we are sending this variety in still small scale”, Economist Tituaña

points out.

Based on this ecological agriculture activity there have been constructed communal cabins

to be able to receive small groups of tourists, being administrated in a familiarly and also

communal level. Tours are organized for the tourists to observe the direct coffee farming

as well as the coffee grower process entails. At the same time, the possibility of having

interchange between the communities, its experience, gastronomy, long walks to

archaeological places, natural waterfalls among others. In addition there is an opportunity

to go to the Andean zone to feel all the above mentioned and also to have the possibility to

meet a thousand year old culture, the quichua and learn their language.

All these activities are currently managed by a communitarian tourism company which

functions in an autonomous way. “What the city council has done is facilitate an organized

development of this activity, taking care of basic services such as: drinking water, sewer

system, electricity, route improvement and the communitarian infra structure. These

beneficiaries programs also have now the possibility of getting credit lines, through foreign

cooperation or regular credit lines, with the city councils support or the same organization,

which has allowed them having communitarian accommodations with add value said

Cotacachi’s mayor.

Because of that jointed vision, both the city council and the organizations, have achieved

having approximately a flow of 250.00 tourists in an annual way, when there are 42.000

inhabitants. This situation demands hard work to guarantee the quality standards in

communitarian and also conventional tourism management. Tourist activity is a great

opportunity because through it, agriculture, craftwork and other services in general,

develop.

Both in the Andean zone as well as in the sub tropical one, rural tourism still have great

future. According to the Tourism Ministry, Cotacachi was the first –at national level- to

organize them in that way and generate direct and indirect employment as an alternative for

the countries’ crisis.

It’s possible that traditional politicians haven’t understood how much tourism would

represent for Ecuador, as one of the greatest opportunities to impel national development

However, while this is happening at national level I believe that local governments are

doing everything to take advantage of nature, ethnic diversity, culture, gastronomy and our

productive abilities. To conclude, if the various productive sectors would get together with

the city councils, craftwork sectors, transportation, etc., we would obtain good results for

the national and foreign tourism”, is what mayor Tituaña thinks about.

! Ecuador needs to have a fraternal opportunity in which Coast, Mountainous region,

Amazon and Galapagos, work together for national development!

Success in companies chains

Dr. Wilson A. Jácome

Director of Programs for Businessmen Improvement

IDE, Escuela de Dirección de Empresas

Each association which is formed, being big or small, must be ruled by principles, because

for its growth, certain principles must be followed. To be able to associate to small

producers there must be analyzed what type of business it will be, or how to improve the

existing income production. The market has a very important role as well as the impacts of

the executing activity, because it isn’t only necessary to produce and have enough income,

but also think about the impacts of that mentioned activity, for the market to be opened for

us.

To work, we have to begin with the experience which each one of human being has, but it

must be improved. If we want to carry out our objectives, it’s necessary to have vision,

because with it we will achieve what we are looking for and on the opposite position

disorientation will be produced. Very often, the lack of vision is what makes associations

fail, when it isn’t shared by everybody. When having a vision, a plan follows, and if there

wouldn’t be a plan, a bad administration will be seen.

In addition of having vision and a plan, we have to look for common incentives for

everybody, both in the economic as social (family well-being, of working people, etc.)

because if there aren’t incentives, the interests will disappear

It’s necessary to have a minimum of resources: land, productive cultivation as well as a

continuous saving to obtain good results for the resources to grow.

Create markets in which everybody works

It is essential that confidence develops and therefore to have an agreement among

everybody. The big obstacle which often arises is when activities are developing and

distrust comes along.

The confidence is generated when we coordinate and cooperate between each other, and

results are seen; if the above mentioned isn’t achieved, confidence won’t succeed neither at

the end.

A background which must always be present when working, are: Truthfulness, integrity

and compromise between staff members. The well-being status which is looked for must

be distributed in a fair way between the working parts, and if this doesn’t happen, the nets

or chains don’t work. If everybody cooperates using the best procedures to work, it’s

obvious that the benefits should be shared among them.

It’s necessary to construct a business model to generate economic and social value. If the

economic value doesn’t exist, the company won’t move forward; economic incentives are

needed, but always having in mind the generation of social value because manhood is not

only body but also spirits. Spirit must be nourished with solidarity.

Any type of possible impacts must be fought and keep an eye on. Each type of productive

activity has a generation of waste and negative impacts, which could cause environmental

and personal damages, and are very difficult to avoid, for the costs, because a lack of

adequate technology, etc. Therefore it’s necessary to have a balance, or at least know the

negative impacts which are occurring and find the way to counteract. But we have also

positive social impacts, which begin creating a productive infra structure, the fact of being

associated, producing and delivering the product, generating richness and jobs. Positive

impact is also the chance to grow because of products quality, for satisfying in an

appropriate way the consumers needs which have to be watched to maintain its growth and

continue collaborating with the community. The social impact leads us to take care of good

connections with the local government, because these are the ones which have a near link

and give orientation to whom needs to solve the local needs.

It’s necessary to have a conduct code, in which all parts are informed with transparency

how to transmit a firm compromise to create great value among everybody and the whole

community.

Without these principles it’s very difficult for an association to move forward, because

anytime it could happen that this unity breaks.

A business model

It’s important to ask ourselves: who will be the final consumer? At this point, we will

directly get to the user who really needs the product. For example, in India, in production

and milk sale, the ones which had one cow or ten got together placing an industry: AMUL.

A perfect defined objective was to take care with a better product of the population (final

consumer) and pay the fair price to the milk producer (key provider). Currently that

industry competes with the big ones. This was possible thanks to solid working equipment,

maintaining a permanent dialogue among everybody. AMUL is an example that you can

grow until you become big.

Nowadays the companies are interested in getting near to big markets, which are at

worldwide incorporated by a 70-80% of people which are considered “poor” for having

daily income of US$ 2.00, and maximum US$ 5.00. So, big companies, multi nationals are

interested in working in a joint way, Nestlé is one of them. Since 1870, Nestlé has

developed a model called “the dairy districts”, which consists in the following: Nestlé gives

all the technology to the small producers, gives them work rules and always buys (at good

or bad times), when milk is left over. And I mention this example, because often it is

believed that there is exploitation of big producers towards small ones. There are few

companies which have had this mentality; but on the other hand they understand and are

aware, that only working together and creating markets, is the optimum way to enter into

markets working with small producers and incorporate them in the provider’s chain. Then,

within the business model, the decision would be the wish to work until the end of the

chain (as AMUL does), which would be decided by the people who are becoming

members; or the desire to be providers of a company (such as Nestlé) with which you can

share the vision to be fair, who constantly receives the product paying the adequate price

for it.

Once the client is defined (final client or user) it’s time to think about which would be the

archetype of business to start and it could be the chain or net, without major formalities. It

could also be formed as a cooperative (such as El Salinerito). Another possibility could be

to make a legal company.

Depending on the business model it is convenient to look for advice and help from

different institutions related to that business. It is evident that there must be cooperation

from the government even if it’s only to maintain good relationship. However it would be

also good to turn towards universities which need contact with real life and would be more

than happy to make them feel welcome by teachers as well as by the students who could

contribute with ideas in which both parts will learn together.

Rules of action to be followed in markets

All the members must by clear in their intentions, that common shared vision (what is

expected to do, who is our client, etc.) and collaborate to create that market. At this point,

very often a break off occurs between the members, because when they see things working

well, they want to have their independence. However, if you want to be strong and grow,

it’s vital to maintain the association which should strengthen common interests. Loyalty

and compromise should exist to develop a market. There is to take in mind that the

objective is to reach the final user, who has to know very well the market, for which there

are diverse means of information technology among others.

It’s important to create a brand, for which you start offering a product of constant

uniformity and which satisfies the user’s needs.

You have to keep in mind that any business needs financing and currently you can find

each day new offers for it. When going to a bank, they ask for requirements which

sometimes are difficult to carry out. However, there are other doors open for the small

producers, because acceding to credit could be a long process.

The work team which should always exist in any type of association, is the one who helps

to form a vision and work plan, to finally start doing the job. But the created business has to

be structured and institutionalized. Often, while time passes, formed things dilute

precisely for not being institutionalized. Therefore it’s convenient to establish work

methods, which will arise with each one of the producers experience. That experience has

to be enriched with institutional norms which are devoted to the producer’s specialization

fields. Once the work procedures are established and having trust among everybody, all the

above mentioned will allow its growth. The time will come in which diversity will be

possible and in consequence, even decentralization There is to mention that the more you

grow, in base to decentralization, it is necessary to create a holding, which again is formed

based in confidence.

It’s necessary to have an enterprising leadership to begin with. To form businesses, and

give them institutionalization a directive leadership is needed; afterwards comes a

participating leadership to decentralize and finally a political leadership, not meaning about

the governmental sense, but in the good peoples management. The chains or net, work

based on people, it’s confidence which sometimes need to be structured to achieve results.

As it grows, this structure has to be institutionalized.

Confidence, institutionalizing what is done, capacity, knowledge, know how to produce,

create markets, worry about the communities, not thinking in an individual way but sharing

among everybody, are the factors for productive chain success. That’s the only way in

which that quality product can reach all over the world, and at the same time create well-

being for our society.

Control and Quality Practice with Farm Work Products

Farms need to have Schools

Ing. Jaime Freire G.

Financing Manager Director and

Association strengthening

ACDI VOCA

A product with quality is the one which carries out the norms and standards which the

market requires, and for this to become true, we need to have a positive attitude towards

quality. In other words if there isn’t a real interest in obtaining quality products we won’t

achieve this goal. This implies the need of a series of methodic and gradual processes,

which sometimes are hard to follow but are absolutely necessary to obtain the market

required product. Finally, besides having a good attitude we must have a good disposition

to work with quality, which is learned little by little.

Cocoa’s quality

Speaking about cocoa, quality is a very ample process because it starts from its planting.

As soon as the producer chooses the variety to be sown, a stick to graft, a tree from which

you want to take the seeds, etc., he’s doing the first quality selection. Afterwards quality

must be built up little by little with the different cultural practices which have to be done.

For example, when we prune a tree or are controlling the deceases, there are processes

fundamentally oriented to obtain a first class product. We assure to obtain quality in the

harvest, as we separate the bad and keep the good, ripen and healthy cobs. Quality

consolidation is obtained with the after harvest treatment, as we have to continue using the

adequate protocols, concerning to fermentation and drying, which can’t be accelerated. A

fermentation protocol, depending in the variety, could take from four to six days, the same

happens with the drying. This is what consolidates quality.

The need to train

The Ecuadorian cocoa “Arriba” has excellent potential and, on the other hand, “as a

country” we have the need to satisfy the special cocoa demands. As an example I will tell

you my own experience, because I work in a project which constantly receives buyers for

special cocoas, with a specific fermentation, with a unique flavor, from a specific zone, etc.,

and therefore we must satisfy those needs.

Capacitating is very important because a good production will allow sustaining rural

people’s economy. In the majority of the cases, cocoa represents around 60% of the family

budget, which shows us how important it is for the people which produce it. To have a

good production, will improve life quality and strengthen the producer’s economy.

Finally, each one of us has the compromise to maintain the Ecuadorian cocoas prestige,

because we have the best cocoa of the world. “Arriba” brand is recognized everywhere, and

we have to keep that status and more than that, help for its recovery.

Cocoas Potential

During the last 100 years, cocoas worldwide demand has increased 3% annual, which

means, that each year we increase production in that percentage. We have an extraordinary

future with cocoa, because it’s possible to triple the production without causing any

problem with the prices.

The price which is one of the main producer’s worries is another plus which cocoa has. In

the last 20-25 years, prices stability has been permanent. There have been ups and downs,

nothing alarming for the producer. Prices have been stable, for which long term processes

have been possible to arise.

Nowadays, chocolate is considered food and not the candy which has to be in every child’s

party. Now it is food which gives us benefit for our heath and is consumed more each day.

All the above mentioned shows us that cocoas market is safe and, it is worth to invest in it;

that it is possible to work with one of the best products Ecuador has.

What happens with our cocoa?

We have a golden mine, because our cocoa is the best worldwide. There are times in

which the Ecuadorians don’t recognize this fact. Samples of our cocoa have been taken to

be planted in other parts of the world, but the flavor isn’t the same; it could be because of

cocoas particularity; ground quality, light, rain among others.

It is a pity to have to accept that our production is the lowest in the world; we have the best

but do not produce in big quantities. Ecuador produces each year 5-7quintals per hectare

while Asia produces one ton (22-25 quintals), which is terrible because if productivity level

would be good, the countries economy would be better. Ecuador has around 100.000 cocoa

producers even if there aren’t “big producers”, because it’s not as with the banana business

in which there are 6 or 7 known names as “big banana producers”. Cocoa has a strong

human capital immersed in its production which is very important.

Cocoa represents 7% of the agricultural GIP and 4% of the non oil exportations. It has been

an historic protagonist for being the main cocoa producer of fine aroma in the world,

because 65% of it comes from Ecuador; at world level, we are in 8th.

Place. With all the

success with advantages and disadvantages, we have a big problem; there isn’t agricultural

extent ion, neither from the Estate which ends up being a terrible deficiency.

How to make the most of potentialities?

On the other hand, the cocoa sector has other potentialities such as the presence of

projects and organisms support as never before. There are around seven projects which are

being worked in a coordinated way, which is very important. There is a great amount of

land to be sowed and it’s necessary that each farm’s density is the adequate for new

planting. The good part is that currently the country has clone gardens (around 30) which

are located along the coast, from which selected material can be taken. In addition there are

several nurseries which operate along the Coast which are owned by small producers and

have visualized the great opportunity to undertake a business. Talking about ACDI VOCA,

we are supporting around 27 small nurseries which have a commercial and business vision.

We also find micro businesses which serve the sector; there are producers who have

organized themselves to prune and assist agricultural needs; there are nowadays more

buyers who wish to make business in a direct way with the producers, and obviously assure

the quality.

Ecuador has a valuable human team and very well trained technicians. ACDI VOCA has

trained more than 100 people; the pro north project has trained around 250 people. All these

projects together probably will add around 400 trained people which are ready to start

working.

There is the need to implement training processes and there is already a great interest

among the sector producers for this to happen. Three years ago when we were

implementing our project, people of the communities asked for help in several topics such

as credit, irrigation, etc. a series of physic requirements, when the real importance for them

nowadays is capacitating more in different areas. I’m sure that the era of the “Pepa de Oro”

(the golden seed) will return with a continuous capacitating.

Camp Schools (ECAs)

ACDI VOCA is a project which started in 2005, working in Esmeraldas, Manabí,

Guayas and Los Ríos, suggesting the methodology of the Camp Schools (ECAs) The last

mentioned is a integral methodology, which allows not only to teach the producer to

manage its farms and increase their productivity but also contributes for the people to work

together in an efficient way. One of the country’s weaknesses is not having strong

institutions or associations and also people’s tendency to work individually. Basically, a

camp school is a group of 25 producers which get together during 6 months every 15 days

to work on practical exercises, to rescue ancestral knowledge which each one of the

producers might have and they share them among each other. Informal technical lectures

are given around 40 minutes, in which they receive the explanation about the different

problems which the growing cultivation goes trough and afterwards five people get

together, go directly to a tree to learn the practice of the above mentioned, under an advisor.

This is the moment in which things are being discovered and afterwards shared in a plenary

The purpose of this methodology is to change people’s minds (before, a producer was

called “harvester” now they call themselves producers).

Achievements

ACDI VOCA was created to prepare small producers, strengthen associations and

produce nurseries of young plants. Now you can see the achievements in detail:

We must have a positive attitude towards quality and apprenticeship, because the only way

in which the country will move forward is by having an adequate capacitating, working

hard and in an honest way.

Cocoa: Ecuador’s important product

Lorena Solórzano S., MBA

Sectorial Cocoa and by Products Coordinator

Corpei

Cocoa keeps on being a fine product for Ecuador, not only because it’s worldwide

appreciation along 400 years but for what it stands for and the different links in the chain of

generating direct or indirect employment, the effect in well-being increase, in add value,

among others. In August 2008, through a program held by the IDB and Corpei, basic

statistics were done in that sector which shows us that Ecuador has 94.855 Agricultural

Productive Units (UPAs) of Cocoa which represent around 408.000 people at primary

production level; 361 identified collectors; 48 exporters; 9 companies which produce

by products and chocolate. Besides all the above mentioned, the sector brings together a

4% of the national PEA and 12.5% of the agricultural PEA.

From the 94.855 cocoa’s UPAs, 58% corresponds to small producers with areas less than

10 hectares of cocoa, 31% are producers which have areas between 10-50 hectares and the

remaining 11% have productive units with areas bigger than 20 hectares, which reflect

463.787 hectares of planted cocoa.

In 2007, this sector represented an income of US$ 248 million dollars obtained by

105.00 TM. With two types of cocoa as income sources: the Arriba Cocoa, for which we

have been recognized more than 400 years, and the Don Homero (CCN 51) which develops

a good elaboration process for cocoa butter, which with an adequate fermentation process,

is also able to develop a good taste profile. Nowadays we continue being the first country

in the world, to provide cocoa fine aroma with a market segment of 61%.

Information Source: CORPEI – Basic Statistics of the Ecuadorian Cocoa sector 2007.

(1) Because of the big territorial disperse and difficult access to the North Oriental region, this investigation

corresponds only to selected cases (Representative Members of Visited Associations, etc).

(2) The South Oriental region (Zamora and Morona Santiago), which are smaller cocoa producers aren’t

taken in mind.

Markets:

European market is very important for Ecuadorian cocoa, not only because of its purchase

volume but because they are a market which pay better prices for quality, being one of the

most important chocolate consumers containing more cocoa, followed by USA with a 25%

which is the equivalent of US$62 million.

Even nowadays, grain cocoa’s exportation –both in volume FOB as well as in dollars- is

the main exportation segment of this item with 93% and 91% respectively, followed by

cocoa paste and powder with 3% for each one of sub segments. For the last mentioned,

purchasing market turns to South America, mainly Chile and Argentina.

Demand for Premium Cocoa: markets demands

Having a frame of competitive markets and the need to make a difference between the

chocolate producers to assure their staying in the stands, it reflects: i) a 4% annual demand

average; ii) lots of competition because each year there are new products; iii) if the profit

margins are small the businessmen have to decide the difference between standing status or

brand, sustained in the quality promises starting from the planting to the final product and

having a constant recipe for their products.

Under this context we ask ourselves at which point do we take up again the cocoa and

chocolate concepts?

We must do it exploiting our origins and the various organic profiles developed in the

cocoa beans (flowering period, fruit, nut or distinctive flavors), projecting the benefits of

food and health, besides of having special certification of ecological type and fair

commerce. Any of the above mentioned strategies are fine, but they must be consistent in

delivering a product with good aroma, a grain which has gone through a good fermentation

process, without odors or strange flavors, capacity for blending and competitive prices.

Availability for products in stand, and management in distribution logistic are very

important if we have in mind that markets such as Lebanon, in which 75% of the

population consume chocolate at least once a week, followed by Saudi Arabia with 61%, or

Japan with 59%. There are markets such as Switzerland and Germany which consume

yearly, more tons of chocolate per person.

Ecuadorian’s cocoa route: satisfying demanding markets.

Because of our cocoa’s characteristics we could say that we haven’t got competition, that

the chocolate dealers need that profile to develop their products, but if the required quality

isn’t achieved –with our beans and the processed ones- they can have the option to look for

substitute cocoa’s or good after harvest processes.

In this supplying process, in which we have continuous messages for the importance of

having nutritious security, lack of raw material, the need for draw up; we can see the chain

of values, the landmark in which commercial relations are the producers confidence, the

above mentioned product quality plus the credibility which takes time to be built and the

experience which continues working while the processes go on.

It’s interesting to watch how many businessmen in our country, add value through semi

manufactured products, but above all, following these tendencies with chocolates with

different origins such as in Esmeraldas, Los Rios and. Manabí. They offer options with

different cocoa’s concentrations (77%-75%), with exotic fruits and milk added to

chocolate, but keeping a high cocoa percentage. Even with organic certifications, fair

commerce, Rainforest Alliance, or a combined strategy of all the above mentioned which

are valued by the consumers.

Ecuadorian cocoa’s path should be to show a great interest for high quality chocolate from

the consumer’s point of view, considering that the ones consumed by the world in 2006,

33%, was dark chocolate. Only at North American level, dark chocolate’s sale, represented

a 9%, and if we add to the previous, the ones with high cocoa contents, the percentage

would increase to 24%.

There is also the possibility to specialize the markets with dark chocolate which at world

level would be between 5-10% of the total of dark bars and expand to Asian and Oriental

countries which allows us to have a good view for the future and for our Pepa de Oro

(Golden Bean).

Stuggle at stockbreeding

Mr. Paul Olsen P.

President of Stockbreeders Association

Coast & Galapagos

According to the last farming census, sponsored by Sica World Bank in 2000, it was

determined that 43% (5.000.000 hectares), from our countries cultivable areas, are

dedicated to pasture, almost half of the territory. They said as well, that the above

mentioned activity generates in a direct or indirect way, more than 1.500.000 work posts.

Without doubt, this is an activity from which most of the Ecuadorian population depends

of, to survive.

In spite of it and also comparing with what happens with rice producers because they are

basic products, its economic stability depends on the political interference of governments

in turn, who take part in establishing prices, ruining the right for these sectors to obtain a

fair profitability for their sacrifices and risk, allowing a better life style for the people

working at this big agricultural commercial chain.

The bigger amount of cattle is raised in the Ecuadorian coasts (nowadays estimated in

70%). At the same time the biggest milk production is focused on the mountains region , in

which 67% of the approximately 4.000.000 liters which are produced, around 35% goes to

industries, and the remaining is being commercialized as fresh milk or cheese in the

informal markets or rural areas demonstrating the importance of this farming area.. 58% of

the production is measured in UPAs (Agricultural Productive Units) in more than 20

hectares, while 42% in less than 20 hectares.

There are around 2.300.000 cattle herds and only less than 10% are processed as meat in

decent and first class places. 92% of them are in urban areas.

According to the same census, because of costs increase and lack of help, the cipher of

4.500.000 cattle herds, has dropped to 3.8 - 4 million cattle herds.

In the last years, it’s true that because of having the dollar as our currency,

competitiveness was diminished in this sector because of different causes such as

production costs increase in a greater scale as the sale prices for milk and meat were

allowed. It’s also true that the purchase power has been increased for those depending on

this activity and has also allowed economic stability in this field. In addition, because it is

an activity which is managed at long term and the dollar is a fundamental tool to plan

economic exercises.

In the last months, the ranching business has not only received the price increase at

world level, such as: barbwire, which rose from US$ 21.00 to US$ 70.00; fertilizers, from

US$16 to US$35.00, or animal balanced food, from US$ 8.00 to US$ 15.00; among the

most important ones. This increase has changed production with higher costs which

couldn’t be compensated by the sale costs because of the Estates intervention. When the

Estate began applying this increase, milk sale price at farm level was at US$ 0.32/liter,

while in Colombia and Peru it was at US$ 0.28/liter. Besides, the Estate set a top price for

farm milk at US$ 0.34, which derived in great loss to the sector and as a result, many milk

farms broke, plus a severe winter which flooded the Ecuadorian coast land. Several months

later, the Ministry of Agriculture, canceled the fixation of the top milk prices at farm and

also of some other pasteurized milk presentations. Currently the milk price per liter at farm

in Ecuador is at US$ 0.40/liter without being consequent with the costs increase, neither in

the price in which it’s sold in neighboring countries such as Colombia, at US$ 0.55, Peru

US$ 0.48 or Venezuela US$ 0.70.

The law for tributary equity affected the sector in a bad way, because it imposed a land tax

to be paid, which had as a result a double tax payment, plus other imposing payments

which pushed even more the sector towards its extinction. However, there was a

consciousness about this problem, from the authorities’ side, and temporarily this law

called “tributary equity”, has been put aside.

I can only say, talking about the new Constitution, that there are many topics and spaces

which are not clear and could drive to discretionary ways of doing things by government

employees in turn, being some of the articles improvised and unfair, and in some cases

attempting norms of conduct which pitifully shows legal instability and affects all the

sectors of our Country.

Interview

Altered Constitution or what?

Eight months after being part of the Constituent Assembly, Economist

Pablo Lucio Paredes (PLP), today former Assemblie’s member, granted

an interview for the Program Bajo la Lupa, which is conducted by Joyce

de Ginatta (JG) and broadcasted by cable channel CN3. The mentioned

interview will be transcribed next.

JG: Was the Constitution Project altered?

PLP: Ecuadorians were waiting for the new “political class” to act differently from the

traditional parties, which hasn’t happened. The first day the Assembly took over those

famous full powers, telling overall, what was being done and how to do it, and even the

same day they included a clause which said that any Assemblies decision, couldn’t be

questioned by anybody in the country this is, it was above the good and evil. Afterwards,

the anti democratic action arose during the whole assembly, and finally the texts were

adulterated (there are texts in the Constitution which weren’t approved by the assembly

members); a vocal of the Electoral Supreme Court was thrown out as it was traditionally

done by the previous parties; decisions were taken without any consultation as it was

before; the Justice Supreme Court was going to be taken over, etc. I deplore to see that this

majority is acting in the same way as the previous parties. We haven’t gained or advanced

in anything concerning to our country.

JG: By any chance, the partisans aren’t with President Correa, because I can see a

great amount of political parties which are part of the government?

PLP: Of course and without doubt. However there were new people in which we had the

hope to act in a different way, but they have done the same things as the partisanship. Some

days ago, a foreign friend said, and probably he was right “I think this Government, isn’t

the first government, but perhaps the last one of the same things for our country”, which is

serious because everybody is hoping for a fraud.

JG: But there is something worse: the previous partisanship never before attacked the

church (more than 95% of the population is Christian), and on the other hand the

current party has dared to attack it and more than that, they dared to enter into

churches to commit vandalism and evil actions, with other words, they have

desecrated it.

PLP: I consider myself a practicing Catholic, with lots of faults, as everybody, but if I were

part of the Catholic Church hierarchy, I would act the same way as they are doing, because

sincerely the articles related to life, family and more are at least “ambiguous”. It’s said that

life, family, education, etc. are respected, but it isn’t said in a clear way; that’s why the

articles are ambiguous, so to speak. That’s why I more than understand and with all the

right, why hierarchy can tell people their opinion in an open way.

JG: Since I’m also Catholic and with faults, I would have been very disappointed and

surprised, if the Church wouldn’t have expressed their feelings concerning the matter,

precisely because one of the norms which Catholics are taught is to defend our

principles and faith.

PLP: There are people who think that the Church shouldn’t get involved, but I say, how not

to do it? If the Church considers that there are texts about the topic which affects the

essence of what the Catholic and Christian religions represent, it’s obvious that they will

express an opinion. If the opinion would be about Constitutional Court, Economy, etc. it

would be different.

JG: Talking about Economy, what people are interested in is not to wake up at three

o’clock in the morning with insomnia because their children can’t get a job, overall

the middle class which has fought to give their children a good education with lots of

sacrifice. Don’t you think that this Constitution is destroying all the things which were

achieved in previous periods?

PLP: Let’s start talking about the fact that Ecuador needs changes. We are not satisfied at

the moment with the results; in Economic terms it’s a country which hasn’t generated

enough richness, which hasn’t shared it among everybody in a fair way. What is being

considered, won’t carry out its objectives, I have no doubt and hope I’m wrong about it. If

we imagine this vision, in ten years we will look back and say: “another lost decade”,

because the Government’s vision is based in certain things which aren’t excellent to allow

the economic growth. It’s based in the Estates intervention in every aspect of the economy

and society. There is a very clear phrase in one of the articles with which I do not agree:

“The Estate will promote the citizens whole protection in all the cycle of life”, this means

that the Estate has to protect the citizen from the day of birth until death. Is this what

Ecuadorians wish, an Estate which is involved in everything, protecting us all our lives? Or

would it be better: We wish an Estate that offers us the tools, opportunities, and lead us to

success?

There are other articles inside the Right for Liberty (before it was Civil Rights) which says:

“The right for material equity”. What does this mean? That everybody will be equal? Is that

the society we wish to have, while Cuba is already getting out of it? I don’t think so. I

believe we wish a country in which we obtain opportunities, education, health, a good

financial system, etc. This vision tends to have in ten years –if we follow this path and hope

not- that regret arises.

JG: Don’t you think that it’s wicket to try to return to all the faults which were

already proven and didn’t lead us anywhere?

PLP: I don’t have any doubt that’s why I insist saying that in ten years we will regret again

if we go for that model. I’ll talk about a specific case which affects people: The Social

Security. Are we happy with this system? In general I would say no. Then, if the

Constitution focuses in this area it is supposed that something different which solves the

problem is offered, as other countries are doing. And how are they doing it? Choosing at

least for a mixed social security system, which means a public and private participation;

and a second choice of being mixed, is by having collective and individual accounts.

This Constitution doesn’t open the door to this system and more than that, it closes it

because it claims that security system can’t be private. This is a fundamental topic in

people’s life because they expect to receive something for their retirement.

JG: Talking about long term projects, these have been possible for having the dollar

as our currency. Is the dollar being strengthened or perhaps being removed or are

they talking about a basket of coins to return to a currency which is a piece of junk?

PLP: In first place, the dollar was never mentioned, at least to show that “Ecuador’s

currency is the dollar”. If afterwards it’s decided to change, well, a Constitutional Reform

must be elaborated. But not only it isn’t mentioned, but there are a series of factors which

opens the door to drop the dollar some day. As an example, the fact to take away the

Central Bank’s autonomy which nowadays is a Governments “additional dependence”

which is a risk for any type of manipulation. Central Banks all over the world are

independent, with different functions according to each country, but independent. The

“macro economic stability”, is defined as an economic growth, which is wrong because it’s

“basic price stability”, and that is Central’s Bank objective.

Talking about fiscal matters, it’s a topic in which the Government will spend a lot of money

with all the vision it has and without any limit or rule. The only thing to be appreciated is

that the permanent expenses will be financed by permanent income but in a general and

subjective way, which isn’t a rule. In other words there aren’t fiscal rules of any kind.

When the dollar isn’t mentioned, the Government manages the Central Bank, when there

are no fiscal rules, when in the working area flexibility is eliminated (which isn’t to remove

workers, but to have more opportunities in the labor market), you could think that any time

the dollar will be eliminated to enter into the famous South American or semi South

American currency (because I can’t see countries such as Peru, Chile or Colombia joining

this idea).

The notary topic is the typical example of the Governments intention to capture everything

for the Estate to own, because now they want to turn them into public employees, so

nobody earns more than others, which is a complete absurd idea. It is to suppose that when

you need a notary, you choose the one in which you have confidence, but with this new

prospect it won’t be possible to handle personal matters because that confidence won’t be

the same.

JG: What we have been searching for, when talking about “changes”, is precisely to

give our children, grandchildren, brothers and sisters, opportunities, and for this to

happen, we need security for private property. When these offenses exist, nobody will

invest or extend their factories or businesses because there is a lack of private

security.

PLP: Obviously, all this generates an environment in which nobody will invest, nobody

will save, and in which a normal dynamics won’t exist. Talking about properties and

expropriation, the last mentioned one should be done under a simple criterion: public

utility. This means that if a street must be opened to build a plaza or market, expropriation

has to be done to whom goes through that path, and there is the public utility existence.

However, in the Constitution, expropriation has been placed for group well-being, for

development plans, for general interest, etc. There are approximately five descriptions for

expropriation, when there should only be one, which is, the public utility. This is a matter

for people’s preoccupation and I confirm again that in ten years, the result which

Ecuadorian people want won’t be the one we wish to have.

The basic concept of “The rule of Law” is being eliminated, even inside the current

Constitution where Ecuador isn’t any more a “Rule of Law” but “of Rights”, which is

different. “The Rule of Law” means that the Estate’s obligations are to function in base to

the law and right; while the “State’s Rights” mean the demand from people towards the

Government for their rights (education, health, free time, etc) and a guarantee for them.

JG: Every parent wishes high quality education for their children, but with this

Constitution it’s terrible……

PLP: Talking about education, one of the important changes to be done is decentralization.

In the chapters about education and territorial, there is nothing about educative

decentralization and the reason is the alliance between the Government and the MPD party,

because decentralization makes MPD loose political power. In second place, there should

be the concept in which the children own the budgetary items and with it, that the child is

entitled to choose its education. But let’s not go so far, the minimum needed is that the

budgetary items go to the schools name and not to the teachers, because in the rural zones,

the teacher often obtains “a transfer to the city” through their influences, taking along the

budgetary items and leaving the poor school without teacher or budgetary item. Why

wasn’t this topic written in the Constitution? Because MPD didn’t want the schools to be

the owners of the budgetary items but wanted the teachers to continue being the owners. To

conclude, that political negotiation hinders the reform in those fundamental elements to be

done.

JG: Five Provinces voted in a majority way for the autonomies in 2000. Does the

Constitution consider doing something about it?

PLP: The matter is raised but in a wrong way, starting from the simple fact that the

autonomies process should begin with a referendum or consultation in the place in which

people ask for autonomy, and based in that the process works, but starts with a Congress

law and not only with peoples decision. In second place norms can’t be clearly seen for

which the autonomies legislation rights are, because by being autonomous there is the right

to legislate and if this can’t be done a great part of autonomy power is lost. In third place,

there are a series of competences which are kept by the Government, even competences

which are already decentralized in Ecuador such as the Airport, Registry Office, the ports,

which shows us the backward steps in decentralization matter. Finally, the Central

Government has a serious of faculties for the competences to be transferred to the

autonomous regions passing through a process of national competences. In other words,

you have to negotiate with a centralized entity to see if the competence is given or not. It’s

a process of autonomies in words but not in reality.

JG: To change things a Statesman with credibility is needed.

PLP: It’s a pity that in Ecuador we tumble over and over without finding the path or the

necessary leadership to make the country really move forward, because the lack of the

above mentioned. Ecuador needs a series of changes and we have to push them, but all the

things we are observing in the Constitution and the Government are not the ones Ecuador

needs.

JG: We need a Statesman, somebody with a vision of a country moving forward

without moving back. We don’t want populism. That Constitution project is

damaging for what Ecuador expects. A well managed economy allows the middle class

to strengthen. The legal security is fundamental; the right for private property is

another central theme to try to get national or foreign investments. We can’t continue

to frighten away the investments and at the same time to make the neighboring

countries businesses grow, because then the workers wouldn’t be Ecuadorian, but

Peruvians, Chileans, Colombian, Panamanians, etc. In this way, young people demand

more now than before, that the principles are reinforced, that the church isn’t

attacked, neither Christians, among others. Nowadays we can see in Cuba a

differentiation because they will pay the salaries according to peoples render.

Colombia is going to reinforce outsourcing to improve competitiveness. In Peru, the

Constitution isn’t touched to give the investors the credibility they need, while in our

country the opposite is happening.

The world can’t function upside down because we are immersed in globalization and

have to create opportunities for the young. The Constituent Assembly hasn’t given the

people what was offered and expected, and part of the problem is that the offers

weren’t carried out since the beginning. It’s fundamental for a Statesman to correct

his mistakes and in our case there are many things to be corrected. Therefore the

Constitutional Project should be considered of absolute nullity because it hasn’t been

managed in a right way. The fact of reducing the accepted articles, the fact of

changing terms and punctuations isn’t precisely what the country expected. This has

had a cost which better should be rejected to have a different country. One of the

suggestions would be to maintain the current Constitution and allow through a

referendum to add those reforms which were considered by Gustavo Noboa and

which could be analyzed right now. I hope that Ecuador thinks about it because we

are playing with our future and our children’s future.

More of the same

Dr. Franklin López Buenazo

An advertising entitled “15 reasons to vote for the YES” clearly demonstrates the political

project of the mentioned citizen revolution, which at the end is nothing else, than an

extension of which the left-wing has been sustaining along its History: promises for an

earthly heaven, romantic aspirations of coffee shops thinkers, dreamers who haven’t

understood that there isn’t free lunch, that there aren’t rights without obligations or that the

path to hell is full of good intentions.

It’s a pity that this is the way of thinking of the majority of Ecuadorians even of those who

deplore that the Constitution institutes a dangerous presidency for democratic future. As we

examine the beliefs of this great majority we can find a preference for collectivism over

individualism.

Collectivism versus Individualism

Individualists value the private initiative, the personal effort, the lonely triumph (as

Jefferson Perez) while the collectivists value the social harmony, the group effort, the

uniformity. The Peking Olympics opening ceremony illustrates the collectivists’

aspirations: thousands of people marching in unison, jumping in a precise formation or

dancing in synchrony and without anybody running into each other. The collective prevails

over the individual. The common well-being is worth more than the individual one.

The “rights” proclamation vision emanates covering everybody: children, adolescents,

young people, disabled, men, women, Afro descendants, housewives, towns, communities,

nationalities, collectivities, people with terrible deceases, consumers…including nature.

Nobody can be left out. The slogan “the country belongs to everybody is the supreme

proclamation of collectivities superiority over the individual. “País” and “everybody”

define collectiveness. There isn’t a space for nonconformity, for the iconoclast ic or the

rebel. As an example, I’ll quote an article about education, in which there is granted the

liberty for professorship but only at University level. The Estate reserves its legal authority

to establish the contents and limits to elementary and secondary teaching, and dedicates the

one and only model of thinking produced at public spheres level. This means that

absolutely all the under age students are marching at the sound of drums and orders in

unison given by the Ministry of Education

The collectivism of the constitutional project isn’t new. The Constitution of 1998 had the

same defect, but in lesser degree, because the 1998 promises for an earthly heaven, have

increased.

Pie in the sky

There is an expression in English, which describes and suits this case: pie in the sky. It

comes from the promises made by religions about the rewards which we will receive from

heaven while we continue suffering on earth and applies in a figurative way to happy

endings which have very little chance to happen. If 1998 Constitution was full of pies in the

sky, the current project promises much more. Here are some examples to illustrate the

problem.

Education budget is doubled and health budget is tripled. The lack to financing, both for

education and health, was never a problem of ideology but of resources lack. And this

situation is not going to change by simple constitutional statements.

Free services in hospitals, schools and till third year of university. This has already been

done. The co negotiation came up because all the above mentioned didn’t have enough

governmental resources. If co negotiation is prohibited, the quality will be deplorable.

We must ask ourselves; does the Estate have enough resources to pay the teachers, to pay

doctors fair salaries according to their preparation and capacitating, to build schools,

highways, to grant credits for farmers and mini businessmen? Could it hire enough well

paid inspectors to control speculation and prices increase? Could the Government fulfill

with the pensions and other benefits offered to housewives, their families and retail

merchants, which are supposed to participate of the Social Security?

It is declared that there won’t be more “plunder” of natural resources. Oil was privatized

more than forty years ago. The 1998 Constitution already declared that the subsoil

resources were Estates property and would be exploited for all the Ecuadorians benefit.

Alberto Acosta once condemned about the waste of thousands of million dollars which

governments had received, can we trust that from now on not a single dollar will be

wasted?

Inconceivable atrocities

It’s true that many of the promises are the same as the ones before; but there are certain

clauses which are inconceivable atrocities. For example: it’s not allowed to use transgenic

seeds and products’, ignoring that corn, is transgenic. American Indians cultivated it and

altered its genetic little by little to the point in which the wild corn is extinct. If the current

corn would desapear, there isn’t a way to recover it. If Colombia or Peru would use any

transgenic product to fight the black sigatoca (a decease), Ecuador would be in great

competitiveness disadvantage concerning to Colombia and Peru. The use of “agro toxics”

also won’t be allowed. This is a stupidity, because every toxicologist knows that pesticides,

germ medicine and other toxics, are in a net balance, beneficial and not damaging for

health.

Another atrocity is the notary “naturalization” Not only that public notaries are forced to

move their documents to the Estates service and also their installations, meaning that

notary’s private property such as computers, desks, photocopier, etc. have to be moved.

Rights to protect nature. Many things have been said of the protection which is demanded

by being part of it, but there are no rights without obligations. Can we blame nature for

earth quakes, drought, heavy rains and flooding with which we are constantly dealing? It’s

absurd.

The way to….

The Constitution of 1998 had a bundle of aspirations and good intentions. If it wasn’t

carried out, was because of statements lack. Many say that it was because a lack of

political willingness. The proposed constitution expands and creates new promises. Now

they say that there isn’t only a political wiliness, but besides that it gives the Executive

enough powers (meaning president and his staff), for the constitutional proposals to become

true. Is this a lie or a fallacy? Probably the second one, quoting Diego Oquendo: “All

politicians are the same. Look back to the near past and you’ll see almost no difference”.

It’s a pity to accept that this or any other world’s governments have the same record which

we are able to see. Governments fail, they aren’t part of the solution but of the problem.

And it isn’t because a lack of political will but because the incentives under which the

members of the public sector operates, leads to failure. The most important defect is that

they aren’t the used funds owners. ! As much as you want to supervise, the “system” is in

charge!

Citizens have very little power to control. It is said that there will be a mandate revoke, that

any citizen can demand the government for violating or fail to fulfill the rights. Is it hope,

naivety or stupidity? A mandate revoke costs a lot of money, many signatures have to be

picked up, certified and registered. Could somebody or any group achieve a revoke? Is

there a naïve person who dares to demand the government without being afraid of

retaliations?

All the above mentioned leads us to conclude that the path which we will walk if the YES

wins, will be full of not fulfilled promises, dreams with hard awareness’s and offended

rights. The proposed Constitution doesn’t create incentives to produce more and better,

neither stimulates undertaking or personal initiative, there aren’t guarantees for investment,

and the legal security is in hands of a Constitutional Court which will be born fouled

unlawfully and illegal. More unemployment, more emigration more poverty is going to be

seen.

The real change

To really change our course we need to change our way of thinking. We have to

understand that a Constitution can’t be a list of pretensions. It has to be a mechanism in

which there is control and power limit. We have to be aware that prosperity doesn’t start

from the “top”, or from messianic leaders or benevolent tyrants. It starts from the “bottom”,

from our individual efforts, from our creativity and strength, from our individualism. We

have to learn that a proper behavior and respect to other people can’t be achieved with

grandiloquent wording and speeches –as it happened in the Constituent assembly- but with

a civic culture which encourages tolerance, stimulates diversity and awards diligence.

Therefore, we wish to “change” and have to leave resentment aside and also the envy for

those who made their money working in business activities. We have to stop blaming the

transnational, globalization and foreign strong nations. We have to open to competence and

offer guarantees to national and foreign investment. If we want to generate employment and

reduce emigration and delinquency, there isn’t another way as to stimulate the creation and

expansion of commercial, industrial and financing activities. Production and economic

growth diminishes poverty. And this isn’t inserted in 1998 Constitution, or the proposed

one. It is a real pity the way the opportunities to change the path are going away. How long

will we be living more of the same?.

Common Sense

Ing. Giovanni Ginatta H.

Executive Director FIE

In these days it’s important to be calm to think about what Ecuador is going through and

about what could happen with the new Constitution. Ecuadorians must dream with a New

Ecuador, but the conflict which is building up gives these dreams different meanings

among people. The Constitutional Project is full of visions and illusions, of good wishes

and almost poetic expressions, and one of the most important one is the people’s Well-

being.

There are moments in which we choose the topic to be read from a book, in which we can

find relevant things, even if the authors are from other periods or worlds regions. This is

happening to me right now when I’m reading the book: “G.K.Chesterton: the common

sense apostle”, by Dale Ahiquist. For those who never heard about Chesterton, he was a

prolific writer born in England, a master of the written word, a member of a social

gathering and a justice champ. At his death (1936) Pope Pio XI qualified him as a talented

faith defender. Chesterton wrote about all topics and did it with excellence. Many consider

him as the best writer of XX century. His words were so strong and pushed to many

conversions; one of them was a young atheist C.S. Lewis. Some of you will ask: why has

History forgotten him? The answer is very simple, because for modern world it’s more

convenient to forget him than risk to enter into a discussion with him. To discuss with

Chesterton (or with his words) means to lose.

Chesterton’s strength lies in his naturalness and in his almost prophetic vision of the world.

For example he said that all the world’s problems come from our lack of obedience to the

two fundamental amendments: Love God and our Neighbors.

And of all the above mentioned, what has it to do with what Ecuador is living? I would like

to make some reflections about some of Chesterton’s expressions, which in spite of having

been exposed at the beginning of century XX, seem to be copied for what Ecuador lives

right now.

Here, some of his phrases:

- The act of defending any of the cardinal virtues has nowadays the hilarity of a vice.

- The Christian ideal hasn’t been tried and found attractive. It has been found difficult

and hasn’t been tried.

- The Christian ideal would create the best of societies and would correct the current

society’s evils. It must be a society based in the ideal house, the happy family, the

sacred family for being the most important society’s unity.

Those laws have to be moral and respect the religious principles, which mean a fair

distribution of property and capital to assure more justice and liberty.

It means not to be afraid to teach our children the truth. But we have left behind us

the truth and instead of turning back and settle things, we quickly rash moving

forward, towards the unknown and we consider ourselves “progressive”. The time

has come to defend the family, the Church and the Estate. Chesterton says that now

attacks come from those who never understood these matters or failed when trying

to live them.

- Manhood has always wanted simple things. To be married with love, construct their

House at the measure of the needs, wants to be a great grandfather and a local hero.

But something turned out bad. Hudge (the socialist pro a super Estate) and Gudge

(the recalcitrant industrial capitalist) have conspired against this man to take away

from him his property, his independence and his dignity.

- Home is the only place of liberty.

- Property is simply the art of democracy. This means that every man is entitled to

have something to be shaped as he wants to. Give almost everybody common

houses, would be pleasant, in a society in which the majority of the population can’t

have it or isn’t able to maintain it, having to depend on a government to cover their

needs. In other words, they would be in hands of Hudge and Grudge. The society is

in danger, especially when common men tumble for the loss of religion, his home or

family, and isn’t sure about what he desires.

- The immense modern heresy consists in altering the human soul to adapt it to its

conditions, instead of changing the human conditions to adapt them to the human

soul.

- Hudge says that women are liberating themselves from home slavery. Gudge is

happy because women are inexpensive resource of manpower. The majority of

feminists will probably agree with me that femininity is submitted to a shameful

tyranny in shops and factories. However, I want to destroy tyranny and they wish to

destroy feminist. That’s the only difference.

We hesitate before the responsibility of stating the truth of our human tradition and

transmit it with a firm and authoritarian voice. That’s the eternal education: To be

pretty sure about the truth of things and dare to tell them to kids. Modern people

escape everywhere from this supreme duty, and the excuse they have (of course) is

that their modern philosophies are hypothetical and don’t convince themselves to be

prepared to convince somebody else. The truthful and secure things are taught in

first place to children.

- Some social reformers try to avoid the difficulty through vague notions about the

Estate or about an abstraction called “Education” which eliminates the parents

function. They base themselves in this strange superstition, the idea of the infinite

resources of the organization, as if the staff members would grow as grass or

reproduce themselves as rabbits. It seems that there is an endless reserve of paid

individuals and salaries for them, which have to take care of everything which

human beings do by themselves, including children’s care….The real defect of their

theory is that an exhausted person must take care of a thousand kids, instead that a

normal person takes care of a normal amount of children. Normally that person

moves by a natural force which even costs nothing and requires no salary. It’s the

natural affection towards the child which exists even among animals. If we

substitute the above mentioned for a paid bureaucracy, we are as lunatics which

water their gardens protecting themselves of the water under an umbrella.

- Liberty means to exercise free will to obey rules. Without liberty, obedience and

responsibility can’t exist. We aren’t forced to obey. We choose. This is dignity’s

essence.

- Don’t trust too much in politics or in any chosen party. We generally expect too

much of the political parties, but none of them is based in a permanent philosophy

and therefore any time it will have conflicts with faith.

- A Catholic has to resist brief philosophies and ephemeral ideas offered by social

movements, political parties among many more.

- The march for “progress” will take us through birth control to abortion and death.

- The pagan search for pleasure in world’s natural forces, but the natural forces when

transforming themselves in goddesses, betray men for something inserted in the

same nature for the Natures cult.

These are some of Chesterton’s reflections in some of his books. The strange thing is

that being written at the beginning of XX century they sound so timely and

contemporary. It’s important to go through some of these concepts now that we have a

new vision of the country in the proposed Constitution.

Ecuador wants a change but hopefully for good things, let’s get rid of the past bad

things without destroying everything in a new adventure which could lead us to a way

of government which we haven’t dreamed of. Each one of us wishes peace, prosperity,

security and development. As a friend told me, let’s wait for this movement to be a

hope and not a revolution for revenge.

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