Ecuador Economic Development Position

7/30/2019 Ecuador Economic Development Position

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Ecuador:

AnexaminationofitscurrentpositionrelativetotheMillenniumDevelopmentGoals

JasonFischer

5/5/2011


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ContentsIntroduction.................................................................................................................................................. 3

Goal1:EradicatingExtremePovertyandHunger........................................................................................ 6

TargetsandMeasures............................................................................................................................... 6

CurrentStatus........................................................................................................................................... 7

Recommendations.................................................................................................................................... 8

Goal2:AchievingUniversalPrimaryEducation............................................................................................ 9

TargetsandMeasures............................................................................................................................... 9

CurrentStatus......................................................................................................................................... 10

Recommendations.................................................................................................................................. 10

Goal3:PromotingGenderEqualityandEmpoweringWomen.................................................................. 11

Targetsand

Measures

.............................................................................................................................

11

CurrentStatus......................................................................................................................................... 11


Goal4:ReducingChildMortality................................................................................................................ 12

TargetsandMeasures............................................................................................................................. 12

CurrentStatus......................................................................................................................................... 13


Goal5:ImprovingMaternalHealth............................................................................................................ 14


CurrentStatus......................................................................................................................................... 14


Goal6:CombatingHIV,AIDS,Malaria,andOtherDiseases....................................................................... 15


CurrentStatus......................................................................................................................................... 17


Goal7:

Ensuring

Environmental

Sustainability

...........................................................................................

18


CurrentStatus......................................................................................................................................... 18


Goal8:DevelopingaGlobalPartnershipforDevelopment........................................................................ 20



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CurrentStatus......................................................................................................................................... 20


TransnationalIssues.................................................................................................................................... 23

IllicitDrugs.............................................................................................................................................. 23

Political:RelationshipwiththeUnitedStates......................................................................................... 23

Conclusion................................................................................................................................................... 24

CurrentStatus......................................................................................................................................... 24

ProgramRecommendations................................................................................................................... 25

Stage1................................................................................................................................................. 25

Stage2................................................................................................................................................. 26

Stage3................................................................................................................................................. 26

Appendix.....................................................................................................................................................

28


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Introduction

Onlyasmallpercentageofallcountriesintheworldarereferredtoasadvancedordeveloped

countries.

Whatcriterion

is

being

used

to

determine

which

countries

are

superior

to

the

rest?

There

arefivecharacteristicscommonlyfoundindevelopingcountriesthatrestraineconomicdevelopment.

Thesecharacteristicsincludealowlifeexpectancy,lowstandardofeducation,poorhealthcare,high

unemployment,andpoornutritionandlimitedaccesstosafewater. Ecuadorisasmall,lowermiddle

income,SouthAmericancountrycurrentlystrugglingforitsdevelopment.Alowermiddleincome

economyranksincomepercapitaintermsofU.S.dollarsbetween$996and$3,945peryear. Ecuadoris

currentlyworking

to

improve

each

of

the

characteristics

that

classify

it

as

adeveloping

country,

but

thereisstillalargeamountofworkthatneedstobecompletedbeforeanadvancedeconomiclevelcan

beachieved. CountriessuchastheU.S.,Canada,Australia,andJapanhavereachedthisadvanced

economiclevelandcontinuedtoexpandtheeconomyovermanyyears. Ecuadoristhe73rdlargest

countryintheworldbytotalareaandislocatedinWesternSouthAmerica. Ecuadorbordersthe

EquatorandthePacificOcean,betweenPeruandColumbia.1 TheEcuadorianeconomyislargely

dependentonexportsofoil,bananas,shrimp,coffee,fish,andotherpetroleumresources. Their

economicstrengthreliesheavilyonthesuccessoftheirexportsinforeignmarkets.

Deterioratingeconomicperformanceinlate1997andearly1998helpedcreateasevere

financialcrisisinEcuadorin1999. Severalexternalcatalystsin1997and1998contributedtothecrisis

includingtheElNio,significantdropsinglobaloilprices,andinternationalemergingmarketinstability.

El

Nio

is

a

weather

pattern

that

affects

the

area

by

rising

ocean

water

temperatures.

During

the

financialcrisis,EcuadorsGDPcontractedmorethan7%. Thisinturnresultedinalargeincreasein

povertyandacollapseofthebankingsystem. Thecollapseofthebankingsystemresultedinabout70%

offinancialinstitutionsclosing,yearoveryearinflationofover50%,unemploymentlevelsashighas


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14%,andadefaultonexternaldebt. Thedefaultonexternaldebtresultedfroma65%devaluationof

theirnationalcurrency,theSucre. Ecuadorhasatotalof$15billionindebt,$7billioninforeigndebt

and$6billioninEcuadorianBradyBonds. BradyBonds,namedafterU.S.TreasurySecretaryNicholas

Brady,wereusedasasolutioninMarch1989topreventacollapseofthebankingsystem. Ecuadorand

manyotherLatinAmericancountriesparticipatedinthefirstroundofissuanceofBradyBondsbythe

InternationalBankforReconstructionandDevelopment. Aftermanycountriesdefaultedontheir

nationaldebt,BradyBondswereissuedasasolutiontorefinancethebondsoriginallyissuedbythe

defaultingcountries. BradyBondsplayedasignificantroleinthefinancialsurvivalofEcuador

throughoutthe1990sbecauseoftheirguaranteebytheU.S.Treasuryandtheirabilitytobetradedby

investors. In1999,EcuadorianPresidentJamilMahuadannouncedthatEcuadorwouldonlymakehalf

ofthe$98millioninterestpaymentsdueonthebondsanddefaultontheotherhalf. Followingthese

events,EcuadorianofficialsmetwithcreditorstodiscussrestructuringofthecountrysBradyBonddebt.

InMarch2000,EcuadorsNationalCongressapprovedaseriesofstructuralreformsand

providedtheadoptionoftheU.S.dollaraslegaltenderinEcuador. TheadoptionoftheU.S.Dollaras

legal

tender

in

Ecuador

is

referred

to

hereafter

as

dollarization.

Dollarization,

bolstered

by

rising

oil

prices,stabilizedtheeconomyandpositivegrowthreturned.Duringtheperiodfrom2002to2006,the

economygrewatarateof5.5%andthepovertyleveldeclined. However,povertylevelsstillremained

highat38%. Inearly2008,theeconomygrewatarateof6.5%,adirectresultoftheveryhigh

petroleumprices.Again,povertylevelsremainedhighat35%. Inthesecondhalfof2008,Ecuador

defaultedondebtforthesecondtimeinnineyears. Thistimethegovernmentdefaultedon$3.2billion

ofbonds.

Once

again,

Ecuador

faced

economic

uncertainty,

further

discouraging

domestic

and

foreign

privateinvestment. Oilandotherpetroleumresourcesaccountedformorethan40%ofexportearnings

and25%ofpublicsectorrevenuesin2008.2 AsshowninFigure1.1,thepriceofabarrelofcrudeoilwas

thehighestithaseverbeenin2008andwassignificantlyreducedduringtheglobalrecessionin2009.


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Table1.1usesalinearregressionanalysistoshowthecorrelationbetweentheannualaveragepriceofa

barrelofcrudeoilandtheannualGDPperCapitaofEcuadorbetween1982and2010. Ther2valueof

.7967indicatesastrongcorrelationfortheannualdata. Thisfigurecouldindicateanevenstronger

correlationiftheGDPpercapitawasreleasedquarterlyinsteadofjustannually.

CurrenteconomicconditionsinEcuador,relativetotheother227countriesintheworld,are

showninFigure1.2. Figure1.2identifieseconomicfactorsthatneedtobeimprovedbeforefurther

developmentcanoccur. ThesefactorsincludeGDP,unemployment,theamountofdebtoutstanding,

inflation,andincomedistribution. SomeofthesefactorsareaddressedintheMillenniumDevelopment

GoalswhichhavebeenoutlinedbytheUnitedNationsaspartofaglobalactionplantoeliminate

povertyinunderdevelopedcountries.In2000,the192memberstatesoftheUnitedNationsproduced

theMillenniumDeclarationwhichcontaineddetailsoftheMillenniumDevelopmentGoals.The

Declarationsgoalisforeveryindividualintheworldtohaveabasicstandardofliving,freefromhunger

andviolence,andtherighttofreedomandequality.TheMillenniumDevelopmentGoalsareeight

developmentalgoalsthatfocusonincreasinghumancapital,increasinghumanrights,andimproving

infrastructure.

The

eight

goals

are

to

eradicate

extreme

poverty

and

hunger;

achieve

universal

primary

education;promotegenderequalityandempowerwomen;reducechildmortality;improvematernal

health;combatHIV,AIDS,malaria,andotherdiseases;ensureenvironmentalsustainability;anddevelop

aglobalpartnershipfordevelopment. Eachoftheeightgoalshastargetssettomeasureperformance

andtoestablishabenchmarkforachievingsuccess. TheUnitedNationsseta2015targetdateto

achievethesegoals. Inthispaper,IwillexamineEcuadorscurrentpositionrelativetotheeight

MillenniumDevelopment

Goals.

Iwill

also

address

key

transnational

issues

such

as

environmental

issues,illicitdrugs,politicalinstability,andsuggestwaysforfuturedevelopment.


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Goal1:EradicatingExtremePovertyandHungerTargetsandMeasures

Thefirst

Millennium

Development

Goal

is

to

eradicate

extreme

poverty

and

hunger.

There

are

threetargetsthatmeasuretheperformancetowardachievingthefirstgoal. Thefirsttargetstatesthat

Ecuadormusthalve,between1990and2015,theproportionofpeoplewhoseincomeislessthan$1a

day. Themeasuresforthistargetincludetheproportionofpopulationbelow$1(PPP),povertygap

ratio,andtheshareofthepoorestquintileinnationalconsumption.Thesecondtargetistohalve,

between1990and2015,theproportionofpeoplewhosufferfromhunger. Themeasuresforthistarget

includethegrowthrateofGDPperpersonemployed,theemploymentrate,theproportionofemployed

populationlivingbelow$1perday(PPP),andtheproportionoffamilybasedworkersintheemployed

population.Thefinaltargetistoachievefullandproductiveemploymentanddecentworkforall,

includingwomenandyoungpeople. Themeasuresforthistargetincludetheprevalencerateof

underweightchildrenunderfiveyearsofageandtheproportionofthepopulationbelowtheminimum

levelofdietaryenergyconsumption.

Akeyindicatorofpovertyproblemswithinacountrycanbetracedtounequaldistributionof

income. Onemethodofmeasuringinequalityinincomeisbyanalyzingthesizedistributionofincome

withinacountry. Theothermethodisfunctionaldistributionofincome,whichisusedindetermining

howincomeisdividedamongdifferentfactorsofproduction. Thesizedistributionofincomeis

measuredonanindividualbasisbydividingthedataintogroups. Itconsidersindividualpersonsandthe

total

income

that

they

receive.

A

Lorenz

Curve

is

used

to

illustrate

the

quantitative

relationship

betweenthepercentageofincomerecipientsandthepercentageoftotalincometheyreceiveeach

year. Thegraphincludesadiagonalline,representingthelineofperfectequality,whichgaugesthe

equalityofwealthdistributioninacountry. Theareabetweenthelineofperfectequalityandthe


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LorenzcurveisusedtoderivetheGiniCoefficient. GiniCoefficientscapturetheincomeinequalityand

producesvaluesrangingbetween0and1,representingperfectinequalityandperfectequality,

respectively. GiniCoefficientsmaybemisleadingbecauseitmeasuresanarea. Twoverydifferent

lookingLorenzCurvescouldproducethesameGiniCoefficient. Therefore,thebestrepresentationof

incomedistributionistheLorenzCurve.

CurrentStatus

Ecuadorhassucceededinachievingthefirsttarget,tohalve,between1990and2015,the

proportionofpeoplewhoseincomeislessthan$1aday. In1994,theproportionofpopulationliving

below$1(PPP)perdaywasashocking15.9%. By2007,Ecuadorhaddecreasedthisnumbertolessthan

5%. Between1994and2007,thepovertygapratiodroppedfrom6.8%to1.2%andthepoorest

quintilesshareinnationalincomeorconsumptionincreasedfrom3.1%to3.4%.3 Themeasuresforthe

secondtarget,tohalve,between1990and2015,theproportionofpeoplewhosufferfromhunger,are

alsobeingachieved.Figure1.3showsthatbetween1990and2010,thegrowthrateofGDP(PPP)per

person

employed

has

remained

relatively

constant.

The

number

of

people

employed

was

calculated

by

multiplyingtheemploymenttopopulationratio(15+)bythetotalpopulation(15+). Thegrowthrateof

GDP(PPP)iscalculatedbydividingtheGDP(PPP)bytheemployedpopulation. Between1990and2010,

theemploymenttopopulationratiohasincreasedfrom51to61. AccordingtotheUnitedNations

StatisticsDivision,from1994to1998theproportionofemployedpeoplelivingbelow$1(PPP)perday

decreasedfrom20.1%to5.8%.4Since1990,theproportionoffamilybasedworkersintheemployed

populationhas

remained

constant.

Since

the

proportion

of

employed

people

living

below

$1

(PPP)

per

dayhasdecreaseddrasticallyandtheemploymenttopopulationratioandGDPhasincreasedduringthe

sametimeperiod,itisevidentthatEcuadorwillachievethesecondtarget. Thefinaltarget,toachieve

fullandproductiveemploymentanddecentworkforall,includingwomenandyoungpeople,isalso


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closetobeingreached. Theprevalencerateofunderweightchildrenunderfiveyearsofagewas

reducedfrom14.8%to9.4%between1999and2004.Duringtheperiodfrom1991to2005,the

proportionofpopulationbelowtheminimumlevelofdietaryconsumptionwasreducedby11%or1

millionpeople.5

EcuadorscurrentdistributionofincomeisillustratedinFigure1.4. Figure1.4showsthatwealth

wasmostequallydistributedin1995andmostunequallydistributedin2003.Between1995and2003,

Ecuadorexperiencedfinancialconcerns,mostnotably,thedefaultondebtin1999. Duringthisperiod,

GDPbegantoexpandbutpovertystillremainedhigherthanthatexperiencedintheprefinancialcrisis

levels. Thelowest80%ofthepopulationonlycontrolledlessthan35%ofthetotalincome. However,as

seeninFigure1.1Ecuadorisranked31stoutof227countriesintermsoftheGinicoefficient. Figure1.5

showsthechangesintheGiniCoefficientofEcuadorfrom1998to2010. TheGiniCoefficient

experiencedadecreasefrom2000to2003andremainedrelativelystablethereafter. Asawhole,itis

clearthatEcuadorcontinuestoexperiencearelativelyunequaldistributionofwealth. Figure1.6

illustratestheunemploymentrateandtheemploymenttopopulationratio. Theemploymentto

population

ratio

is

the

ratio

of

the

total

working

age

of

the

labor

force

currently

employed

to

the

total

workingagepopulation. Theratiohasshownacontinuedgradualriseeveryyearsince1990.Ecuador

hasalsoexperiencedareductionintheunemploymentrateeveryyearbetween2005and2010.

Recommendations

Thereareafewmethodstoreducingpovertyinacountry. Onemethodofreducingextremely

highpoverty

and

unemployment

rates

is

by

creating

jobs,

new

businesses,

and

wealth

through

the

creationofastrongmicrofinancesector. Peopleshouldbeencouragedtodeveloptheirownmicro

businessestosurvive. Generally,theseentrepreneursstruggletofindgoodfinancialsupportoptions.

Afterthe1999financialcrisis,theUnitedStatesAgencyforInternationalDevelopment(USAID)in


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coalitionwithEcuadorinitiatedaprojectthatwouldhelpbesiegedfinancialinstitutionslendtosmall

businessowners. Between2001and2004,asaresultoftheassistancefromUSAID,theloanportfolioof

financialinstitutionslendingtosmallbusinessesgrewfrom$86millionto$302million.Asaresultofthis

increaseinloandollars,borrowersincreasedfrom105,000to302,000. AccordingtoaUSAIDreport,

Themicroenterprisesectorprovidesjobsforanestimated1,018,135people,or25%oftheurban

workforce;salesfromthesejobstotaled25.7%ofGDP.6 Theincreaseinaidwillcreatenewjobsinthe

alreadysuccessfulmicroenterprisesector.TheassistancefromUSAIDalsohelped21microcredit

institutionssurvivetheperiodafterthefinancialcrisisandbecomeprofitable.7 Anotherpossible

programthatwillhelpreducepovertyistoinvestinresearchforinnovativewaystoincreaseexports

andmaintainastableeconomyduringperiodswhentheirlargestexportsarestrugglinginthemarket.

Thelastrecommendedprogramistosubsidizefarmingneedstohelpincreaseagriculturalproductivity

andrelievethepressureonexportingpetroleumresources.

Goal2:AchievingUniversalPrimaryEducationTargetsandMeasures

ThesecondMillenniumDevelopmentgoalistoachieveuniversalprimaryeducation. Thetarget

istoensurethat,by2015,childreneverywhere,boysandgirlsalike,willbeabletocompleteafull

courseofprimaryschooling. Themeasuresforthistargetincludethenetenrollmentratioinprimary

education;theproportionofpupilsstartinggrade1whoreachthelastgradeofprimary;andtheliteracy

rateof1524yearolds,womenandmen. Theprimaryschoolnetenrollmentratioistheshareof

childrenofofficialprimaryschoolagethatareenrolledinprimaryschool. Thegrossenrollmentratio

inprimaryschoolsistheshareofchildrenofanyagethatareenrolledinprimaryschool. Thegross

enrollmentratiooftenexceeds100%indevelopingcountriesbecauseofadultsthatarestartingto


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receiveaneducationforthefirsttime. Literacyisdefinedashavingtheabilitytoreadandwriteashort,

simplestatementoneverydaylife.

CurrentStatus

EcuadorscurrentstatusforauniversalprimaryeducationisbestrepresentedinFigure1.7.

Figure1.7showsthenetenrollmentratioforgirlsandboys,primaryeducationcompletionrate,and

numberofchildrenoutofprimaryschool. Thenetenrollmentratioforgirlsandboyshasremained

above99%since1998. Theprimaryeducationcompletionratereachedalowof71%in2002buthas

sincerebounded. In2006,themostrecentprimaryeducationdatawasreleasedandshowsthe

completionrateexceeding80%. Figure1.7illustratesthesignificantimprovementsmadeinthe

Ecuadorianeducationalsystemsincethefinancialcrisisended. In1998,therewerearound30,000

primaryagechildrenoutofschoolandjusttwoyearslaterhadbeenreducedby2/3. Itisasignificant

achievementforEcuadortokeepthelevelofoutofschoolchildrensteadyaround10,000,evenas

populationincreasesasaresultofincreasedmigration. Theliteracyrateof1524yearolds,womenand

men,

has

remained

relatively

stable

between

95.5%

and

96.5%

in

recent

years.

In

2001,

Ecuador

financeditseducationexpenditureswith1%oftheirGDP,leavingitranked182ndintheworld.8

EcuadorscurrentpopulationstructureisdepictedinFigure1.8. Figure1.8showsthatEcuadorsage

distributionisheavilyweightedwithpeoplelessthan20yearsofage.

Recommendations

Basedon

this

information,

educational

expenditures

as

apercent

of

GDP

will

need

to

escalate

quickly.Byincreasingtheeducationalexpenditures,Ecuadorwillkeepupwiththeincreasingdemandat

theprimary,secondary,andtertiaryeducationlevelsasthepopulationstrivestoachieveuniversal

education. Ecuadorshouldinvestintheirteachersandgivethemalloftheresourcesthatareneededto


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educatethepopulation. Schoolsshouldbebuiltinlocationsthataccommodatethevastmajorityof

students,inbothruralandurbanareas. Studentswillnotbeinclinedtoattendclassiftheschoolisnot

locatedwithinareasonabledistance. Theotherfactortoconsiderisschoolfeesattheprimaryschool

level. Schoolfeeshavebeenabolishedinmanycountriesandenrollmentrateshavesurged. People

begintotakefreeresourcesandservicesforgranted,oftenshowingadecreaseddemandforthose

resourcesorservices. However,Ecuadoralreadyhasahighenrollmentrateandifthereisasmall

financialobligation,studentsmaybemoreinclinedtoattend.Byestablishingafeeitwillhelpin

accommodatingtheincreasingdemandforclassroomsandteachers. Allofthesefactorsneedtobe

consideredwhenidentifyingtheneed foradditionaleducationalresources.

Goal3:PromotingGenderEqualityandEmpoweringWomenTargetsandMeasures

ThethirdMillenniumDevelopmentgoalistopromotegenderequalityandempowerwomen.

Thetargetissettoeliminategenderdisparityinalllevelsofeducationnolaterthan2015. Todetermine

thelevelofgenderequalitythatisbeingachieved,threemeasureswillbeused. Thesemeasuresinclude

theratioofgirlstoboysinprimary,secondary,andtertiaryeducation,theshareofwomeninwage

employmentinthenonagriculturalsector,andtheproportionofseatsheldbywomeninnational

parliament. Genderequalityisalsomeasuredintermsofemploymentbyeconomicactivity. The

empowermentofwomenwillbemeasuredusingtheproportionofseatsheldbywomeninnational

parliament.

CurrentStatus

ThereisnearperfectequalityinallaspectsofeducationforEcuador. Girlsareslightlysuperior

incohortsurvivalrate,havingagreaterpercentagereachingthelastgradeofprimaryeducation. Girls


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alsoreignsuperiortoboysinattendingprimaryschool. In2006,employmentbyeconomicactivity

showsmenreigningheavilyintheindustrysectorandwomenintheservicesector. However,both

sectorsexperiencedaslightdrawbackandemploymentwasallocatedtothestrengtheningagricultural

sector.9 ThelatterpartofthethirdMillenniumDevelopmentGoalistoempowerwomen. In2000,

whenthegoalswerefirstset,thenumberofseatsheldinnationalparliamentbywomenwas17.4%.

Today,thatnumberhasnearlydoubledaswomenhold32.3%oftheseatsinnationalparliament.10

Recommendations

Thereareanumberofprogramsthatwillfurthergenderequalitythroughoutthecountry. The

underlyinggoalisforwomentohaveequalopportunityinareaswheremencurrentlyholdthemajority.

Althoughthereisnomajordisparityintheeducationsystembetweengirlsandboys,thereisagapin

theworkforce. Ecuadorcancounteractthisinequalitybylaunchingataxincentiveforanybusinesses

thathaveestablishedtrainingandrecruitingprogramsthatrecognizegenderequalityandhaveapay

scalethatisnotbiasedbasedongender. Theincentivewillcomeintheformoftaxcreditswhichwillbe

directly

deposited

into

the

claimants

bank

account.

Another

method

to

empower

women

is

to

set

a

quotaintheelectionbylawsthatrequireafixednumberofseatsinnationalparliamentbesetasidefor

women. Whenimplementingtheserecommendations,itisimportanttoalsoconsiderthecultural

normsofthesocietywithrespecttoreligionandotherculturalvalues.

Goal4:ReducingChildMortality

TargetsandMeasures

ThefourthMillenniumDevelopmentGoalistoreducechildmortality. Thetargetistoreduce

theunderfivemortalityratebytwothirdsbetween1990and2015. Thethreemeasuresthatwillbe


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usedincludeunderfivemortalityrate,infantmortalityrate,andtheproportionofoneyearoldchildren

immunizedagainstmeasles. ThesestatisticswillbemeasuredusingdatafromtheUnitedStatesCensus

InternationalDatabase.

CurrentStatus

AsrepresentedinFigure1.8,itisevidentthatEcuadorisreducingchildmortality. Mortality

ratesper1,000birthshavedecreasedsignificantlybothintermsofinfantsandthoseunderfive.The

currentmortalityratesforinfantsandthoseunderfiveresidearound2%and2.5%,downfrom5%and

6.5%respectively. TheUnitedStatesCensusInternationalDatabasealsoshowsthepercentofoneyear

oldchildrenthathavebeenimmunizedagainstmeasles. Thenumberofoneyearoldchildren

immunizedhasremainedconstantat99%inrecentyears,upsignificantlyfromthelowof54%in1991.

Recommendations

Inrecentyears,thegovernmenthasshownastrongcommitmenttohealthcareandreducing

child

mortality,

which

is

evident

by

the

99%

childhood

immunization

rate.

Studies

by

the

Natural

ResourcesDefenseCouncilshowthatinfantmortalityratescanbereducedthroughbreastfeeding.

Breastfedchildrenarelesssusceptibletodiseasesandinfectionsduringtheearlystagesoflife. They

arealsolesslikelytocontractdiabetes,sclerosis,orcancerbeforetheyreach15yearsofage.11

Between2005and2009,40%ofchildrenwereexclusivelybreastfedforlessthansixmonths. Duringthe

sameperiod,77%ofchildrenwerebreastfedwithcomplementaryfoodfor6to9months. By

implementingaprogram

to

promote

breastfeeding,

there

is

agood

possibility

that

the

percentage

of

childrenbeingbreastfedwillincreaseandalsofurtherreducechildmortalityrates. Inadditionto

reducingchildmortalityrates,itdoublesasaneconomicincentiveforfamilies,allowingthemtoforego

anyexpensesoninfantformula. Anotherprogram,withprovensuccessinreducingmalaria,was


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implementedintheRepublicofCongo,Gabon,Mali,Nigeria,andZimbabwe. Thisprogramprovided

mosquitonetstochildrensleepingoutdoors. Childdeathsfrommalariawerereducedby44%

comparedtochildrenwithoutthenets.12

Goal5:ImprovingMaternalHealth

TargetsandMeasures

Thefifthgoal,improvingmaternalhealth,canbeachievedbyaddressingthefactorsthat

contributetotheunreasonablyhighmaternalmortalityrate. Therearetwotargetsthathavebeenset

forimprovingmaternalhealth. Thefirsttargetistoreducebythreequarters,between1990and2015,

thematernalmortalityratio. Thesecondtargetistoachieve,by2015,accesstoreproductivehealth.

Themeasuresthatwillbeusedincludematernalmortalityratio,proportionofbirthsattendedbyskilled

healthpersonnel,contraceptiveprevalencerate,adolescentbirthrate,antenatalcarecoverage,andthe

unmetneedforfamilyplanning.

CurrentStatus

Themostrecentdatashowsmaternalmortalityrate,derivedfromvitalregistration,at130per

100,000livebirthsin2000. Thisrateisdown38%fromthe210valuein1995. Thecalculationisderived

fromthedirectsisterhoodmethodadjustedestimates,aprocessofinterviewingrespondentsonthe

survivalofalltheiradultsisters.13 In1999,itisestimatedthatapproximately99%ofallbirthswere

attendedbyaskilledhealthprofessional. Thisnumberhasremainedrelativelyconstantthrough2004

andisupsignificantlyfromthe61.3%in1987.14 Theuseofcontraceptivesamongcurrentlymarried

womenbetweentheagesof15and49waslastmeasuredin2004andwas72.7%,a6.9%increasefrom

1999.15 Theadolescentfertilityratehasbeenslowlydescendingsince1998. In2008,theadolescent


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fertilityratewasat82.6birthsper1,000womenbetweentheagesof1519.16Between2005and2009,

theantenatalcarecoverageforatleastonevisitwas84%and58%foratleastfourvisits. Theunmet

needforfamilyplanninghasdecreasedbymorethanhalffrom1994to2004,droppingfrom15.2%to

only7.4%.17

Recommendations

WecanachievethefifthMillenniumDevelopmentGoalbyreducingthematernalmortalityrate

andbyincreasingthenumberofbirthsthatareattendedbyskilledhealthprofessionals. Thereisroom

foradrasticimprovementtooccurinthisarea. Maternalmortalityensuingfromcomplicationsduring

birthcanbeconsiderablyreducedifthebirthsareattendedbyaskilledhealthprofessional. Thereare

veryhighcostsassociatedwithbuildingamedicalinfrastructurethatwillprovidewomenwithhealth

professionals. DuetothesesubstantialcostsitisunfeasibleasthistimeforEcuadortoallocatethe

necessaryfunds. AnalternatesolutionistosetupmobilehealthcentersmuchliketheAmericanRed

Crossandotherreliefcentersdoduringenvironmentalcatastrophes. Thesehealthcenterscandually

act

as

an

educational

facility

on

the

use

of

contraceptives

and

provide

information

on

other

safe

sex

practices. Thiswillreducetheadolescentfertilityrateandhelpkeeppeoplefromreproducingattimes

whentheycantaffordit.

Goal6:CombatingHIV,AIDS,Malaria,andOtherDiseases

Targetsand

Measures

ThesixthMillenniumDevelopmentGoalistocombatHIV,AIDS,malaria,andotherdiseasesand

threetargetsaresetthatneedtobeachievedtoreachthisgoal. Thefirsttargetistohaltthespreadof

HIVandAIDSby2015andhavebeguntoreversethespread. Thesecondtargetinthisareaistohalt


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andbeginthereversaloftuberculosisandothermajordiseasesby2015.Thefinaltargetwassettobecompletednolaterthantheendof2010anditistoachieveuniversalaccesstotreatmentforHIVandAIDSforallofthosethatneedit. InadditiontomeasuringtheprevalenceratesofHIV,AIDS,andmalaria,humandevelopmentwillbeconsideredasafactorforbeingabletocombatthesediseases.OnemethodofmeasuringhumandevelopmentisbyanalyzingtheHumanDevelopmentIndex. TheHumanDevelopmentIndex(HDI)measurestheachievementsofacountrybasedonlifeexpectancy,adultliteracyrate,andGDPpercapitapurchasingpowerparity,asanalternativetoevaluatingacountrysdevelopmentbasedsolelyonpercapitaGDP.18 EachofthesefactorsisweightedincalculatingtheHDIshowninFigure2.0. Theincomeindexiscalculatedusingthisformula:

The$40,000isrepresentativeofthemaximumincomethatacountrycouldreasonablyaspireoverthecominggeneration. ThenextfactorintheHDIisthelifeexpectancyindexwhichiscalculatedusingthelifeexpectancyinEcuadorandrelatingittotherangeoflifeexpectanciesthattheUnitedNationsDevelopmentProgram(UNDP)expectsoverthepreviousandnextgenerations. ThefinalfactorincalculatingtheHDIistheeducationindex. Theeducationindexiscomputedusingthemeanyearsofschoolingindexandtheexpectedyearsofschoolingindex,equallyweighted. TheHDIweightsthe

incomeindex,

life

expectancy

index,

and

education

index

equally

and

the

average

is

the

result.

The

HumanDevelopmentIndexisimportanttothisgoalbecausethefactorsthatcompriseithelpindicatetheexpectedshiftofAIDS,HIV,andmalariaprevalencerates.


18/39

CurrentStatus

EcuadorhasbeeneffectiveinhaltingandreversingHIV/AIDSdeaths. In2003,theHIV/AIDS

deaths

per

year

were

1,700.

They

remained

at

that

approximate

level

until

2009

and

2010

when

deaths

decreasedto1,400peryear.19Since2000,thetuberculosisprevalencerateper100,000hasbeen

reversing. In2004,Ecuadorexperiencedareductioninprevalenceratefrom243to196per100,000

people.Thedeathratefromtuberculosisremainsaround12.4%oftheprevalencerate. Therecent

decreaseintheprevalenceratewillcauseadecreaseinthedeathrate.Ecuadorhasachievedamedium

statusonthehumandevelopmentindexandcontinuestogainmomentumtowardahighhuman

developmentstatus.

Recommendations

ThereisanarrayofpossiblesolutionstohelpcombatHIV,AIDS,malaria,andotherdiseases. If

Ecuadoristobetterits77thHDIranking,theeducationindexneedstoimprove. Ahighereducation

indexmeanstherehavebeenanincreaseintheaveragenumberofyearsofschoolingaswellasan

increaseintheexpectednumberofyearsofschooling. Theeducatedyouthwillbemoreresilientto

havingsexafterunderstandinghoweasilyHIVcanbetransmitted. Ecuadoralsoneedstoinvestina

programthatwillhelppeoplealreadylivingwithHIVtoreceiveassistancewithmealsandotherdaily

activities. Effortstocombatmalariaareaddressedbyparticipatinginthemosquitonetprogram

suggestedasamethodtoreducechildmortalityrates. Thisprogramcanbeexpandedtoincludeadults

aswellastheyouthpopulation. Otherdiseasescanbesignificantlyreducedwithanimmunization

program. Immunizationscanbedistributedatthemobilehealthcentersandthecostscanbesubsidized

byusingapercentoftheofficialdevelopmentassistancethatisreceivedannuallyasforeignaid.


19/39

Goal7:EnsuringEnvironmentalSustainability

TargetsandMeasures

TheseventhMillenniumDevelopmentGoalistoensureenvironmentalsustainability. Four

targetshavebeensettomeasuretheachievementofthisgoal. Thesetargetsincludeintegratingthe

principlesofsustainabledevelopmentintocountrylawsandprograms;stoppingandreversingtheloss

ofenvironmentalresources;reducingbiodiversitylossbyachievingasignificantreductionintherateof

loss;halvingtheproportionofthepopulationwithoutsustainableaccesstosafedrinkingwaterand

basic

sanitation

by

2015;

and

achieving

a

significant

improvement

in

the

lives

of

the

slum

dwelling

populationby2020. Biodiversitylosswillbemeasuredbyanalyzingtheproportionsofspecies

threatenedwithextinctionandthelandareacoveredbyforest.

CurrentStatus

ThereisavastarrayofenvironmentalissuesplaguingEcuadoranditssurroundingareas. The

mostecologically

sensitive

area,

just

off

the

coast

of

Ecuador,

is

the

Galapagos

Islands.

The

issues

faced

bytheIslandsincludedeforestation,soilerosioninhighlandareas,desertification,waterpollution,and

pollutionfromoilproductionwastes. Ecuadorhasmademinimaleffortstocombatflooding,

desertification,anddeforestation,whichisoccurringatarateof840,000acresannually.20 Landarea

coveredbyforestdroppedover10%between1990and2005. Thisisasizablereductionconsidering

landareacovers276,841sqkm. TheGalapagosIslandsarearguablythemostthreatenedareainSouth

America. Currently,theIslandsarehometo95species,ofwhich,ninespeciesarecurrently

endangered.21

ThepopulationexpansioninEcuador,representedinFigure2.1,isconsideredaseriousthreatto

wildlifeintheGalapagosandonthemainland.Thecrudedeathrateremainsextremelylowandis


20/39

significantlygreaterthanthecrudebirthrate. Ecuadorexperiencedanaveragepopulationgrowthrate

between1.5%and2%inrecentyears.TheotherthreattotheGalapagosisanincreasedtourism

industry. Tourismisverybeneficialtotheeconomyandcanhelpinbringingacountryintodevelopment

quicker,butitneedstobecloselymonitoredtoensuretheIslandsdonotgetdamagedbeyond

restoration. AnothergreatsignforEcuadoristhatevenasthepopulationcontinuestogrow,therehas

beenadrawbackintheslumpopulation,whichwasreducedby4%between2001and2005. Figure2.2

showstheproportionofthepopulationusingimproveddrinkingwatersources. Figure2.3identifiesthe

proportionofthepopulationusingimprovedsanitationfacilities. Anupwardtrendisprominentinboth

figures. Ecuadorhasreachedanothertargetfordevelopmentbyhalvingtheproportionofpeople

withoutsustainableaccesstosafedrinkingwaterbetween2000and2006.

Recommendations

Deforestationcanbereducedbyplacingstrictregulationsontraditionalfarmingandoil

development. Desertificationandfloodingareresultingfromaninfluxofdomestic,industrial,and

agriculturalcontaminants.

These

contaminants

can

be

contained

through

stricter

environmental

regulationswhichneedtobeenactedbythegovernment. Onewayofreducingenvironmental

destructionisbyprovidingcitizenswithaccesstosafedrinkingwaterandsanitationfacilitiesthrough

environmentallyfriendlymethods. Itistheresponsibilityofthegovernmenttodevelopan

infrastructurethatwillleadtoeconomicgrowth. Thiscanbedonebyincreasingtravelaccessibilityin

termsofairports,roadways,railways,andwaterways. Althoughallofthesearenotfeasibleduringthe

remainingtime

frame

set

to

achieve

the

Millennium

Development

Goals,

it

is

important

to

make

developmentsovertime. Onepositiveeffectofdevelopingasoundinfrastructureisreducingtheslum

populationinurbanareas. Peoplethatmayhavebeenunemployedorunderemployednowhaveaccess

tomanynewandexcitingemploymentopportunitiesthatmayhavebeenpreviouslyunattainable.


21/39

Ecuadorcancombattheozonedepletionratebyillegalizingtheuseofhydrochlorofluorocarbons

(HCFCs)inanyproductssoldorproducedinthecountry.

Goal8:DevelopingaGlobalPartnershipforDevelopment

TargetsandMeasures

ThefinalMillenniumDevelopmentGoalsetbytheUNwastoestablishanddevelopaglobal

partnershipforeconomicdevelopment. Therehavebeenanumberoftargetssettogaugeperformance

inachievingthisgoal. Thesetargetsincludedevelopingandimplementingstrategiesfordecentand

productiveworkforyouthincooperationwithdevelopingcountries,makingthebenefitsofnew

technologyavailableincooperationwiththeprivatesector,anddevelopinganondiscriminatorytrading

andfinancialsystem. Thesetargetswillbemeasuredbyanalyzingtheratioofadultunemploymentto

youthunemployment,theamountofofficialdevelopmentassistancereceived,numberofinternet

users,numberofcellularsubscribers,andEcuadorsaccesstodevelopedmarkets.

CurrentStatus

Theratioofadultunemploymentratetoyouthunemploymenthasdeclinedfromahighof4.8in

1995to2.6in2003. Thisisapositivesignthatdecentandproductiveworkisbeingcreatedforthe

youth. However,thatfailstoaddressthepossibilitythatthegrowthrateofyouthtototalpopulationis

high. Studiesshowthattheshareofyouthunemployedtototalunemployedwas53.1in1995andhas

decreasedto43.1in2003.Therefore,Ecuadorisdevelopingandimplementingstrategiestocreatework

foryouth. Thecommunicationindustryhasbeensignificantlyimprovedsincetheearly1990s. The

availabilityoftheinternetandcellularlinesaretwooftheeasiestwaystoaccessaworldofinformation.

Ausercannowquicklyaccessrelevantdata.Theinternetisusedforthecontinuedimprovementof


22/39

companiesandeconomicgrowth. AnanalysisofthedevelopmentofcommunicationsinEcuadorsince

1990ispresentedinFigure2.4.Figure2.4showstherehasbeensignificantgrowthinthenumberof

usersaccessingtheinternetasawholeandasapercentofpopulation. Thenumberofinternetusers

hasrisentomore15%ofthetotalpopulationsinceitsinductioninEcuadorin1993.Thenumberof

cellularsubscribersasapercentofpopulationnearlydoubledfrom22.98%to39.08%,between2003

and2005.

Todevelopaglobalpartnershipforeconomicdevelopment,underdevelopedcountriesoften

receiveasubstantialamountofforeignaidfromtheInternationalMonetaryFund(IMF)andfrom

specificcountries. TheUnitedStatesoffersthelargestamountofassistancetoEcuadorintermsof

foreignaid. TheaidfromtheU.S.hasgoalstostrengthendemocracy,reducepoverty,protectthe

environment,andsecuretheirborders. Between2007and2009,Ecuadorreceived$89.7millioninU.S.

aid,including$39.8millionincounternarcotics.22 Thesefundsonlyincludemonetaryaidthatisdirectly

senttoEcuadoranddoesntcountanysortoftrade.TheforeignaidreceivedfromtheIMFisallocated

totheimprovementofthetransportationinfrastructure,thereductionofpoverty,andthe

improvement

of

the

educational

system.

The

Official

Development

Assistance

(ODA)

received

by

EcuadorfromtheIMFisgraphicallyrepresentedinFigure2.5. Foreignaidhasremainedrelativelystable

between1997and2006rangingfrom$150millionto$250million.However,aidasapercentofGDP

hasbeendiminishing. Ecuadorhasbeenimprovingtheprimaryeducationrateforgirlsandboys,the

childmortalityrate,theaccessibilitytocleandrinkingwater,andsanitationfacilities. These

improvementshavebeenmadeeventhoughaidasapercentofGDPhasbeendiminishing. This

representsEcuadors

ability

to

become

self

sufficient,

and

in

turn

adeveloped

country.


23/39

Recommendations

Ecuadorismakinggreatstridesinitseffortforglobalconnectedness. Theinternetandcell

phones

have

flattened

the

world

to

a

once

unimaginable

size.

The

internet

offers

an

unlimited

number

ofbenefitstofamiliesandbusinesses. Someofthemostimportantbenefitsincludetheabilityto

telecommutewhichallowsuserstoaccessalloftheirresourcesthatcouldbestoredonanoffice

computeroracoworkerscomputeroverseas;theabilitytosearchquickly,easily,andeffectivelyfor

informationthatwouldbeverytimeconsumingtofindinbooks;theabilityforbusinessestooffer

onlinetrainingprogramsandteleconferences;theoptionforonlinebanking;andtheabilitytoemail,

Skype,or

instant

message.

Ecuador

needs

to

execute

on

aprogram

that

provides

more

families

with

the

opportunitytoaccesstheWorldWideWeb.

Intheworld,thetotalnumberofinternetusersasapercentageofthetotalpopulationis28.7%.

Currently,only15%ofEcuadorianshaveaccesstotheinternet. Ecuadorshouldstrivetoreachthe

averagelevelwiththerestoftheworld. Aprogramthatcouldhelpincreasethispercentusesrecycled

cellphonesfromdevelopedcountries. Thesephonescanbesetupwithdataplanstoallowuserstocall

anywhereintheworldandaccesstheweb. Cellphonesubscribersthathaveadataplanshouldbe

providedadiscountonthetaxesthatarepaidonthemonthlybillaswellassmallbusinessesowners

thatareusingtheinternetintheirbusiness.DebthasbeenaseriousprobleminEcuadorinrecentyears

andthegovernmentneedstotakeaction. TheEcuadorianGovernmentshouldreevaluatetheir

spendingtoensurethattherewillbenomoreinstancesofdefaultingonbonds. TheOfficial

DevelopmentAssistancereceivedannuallyshouldonlybeusedtodeveloptheinfrastructureorprovide

neworimprovedservicestocitizens. TheODAshouldnotbeusedtofundprogramsthatarenotself

sustainingbutratherareusedtoinvestinresearchinginnovativewaystoturnmoneypitprograms

intoonesthatareselfsustaining. Ecuadorcanalsoestablishfreetradeagreementswithmany

countriesinSouthAmericatoincreasetradeandexportrevenues. Thecurrentnegotiationstakingplace


24/39

withMexico,Brazil,Argentina,Paraguay,andUruguayshowEcuadorscommitmenttoloweringtrade

barriers,diversifyingtheireconomy,andhavingafavorablebalanceoftrade.Theincreasedrevenues

fromexportscanbeusedtohelpaccomplishthegoalsthatarecurrentlybeingfundedbytheU.S.and

theIMF.

TransnationalIssuesIllicitDrugs

TherearetwomajortransnationalissuesplaguingtheEcuadorianeconomy. Transnational

issuesare

issues

involving

or

impacting

countries

outside

of

one

countrys

borders.

The

first

issue

is

illicitdrugs. Ecuadorissurroundedbytwolargecocaineproducingcountries,PeruandColumbia. There

issignificanttransitoftheseillicitdrugsandothernarcotics. TheUnitedStatesisthedestinationfora

largeportionoftheharvestedcocaine,anditneedstopassthroughtheEcuadorianwaterstoreachthe

UnitedStates. Ecuadorisnearlytheperfectlocationfordrugtraffickerstostoretheircashbecauseof

theweakantimoneylaunderingregimeaswellastherecentdollarizationthatoccurredin2000,

allowingtraffickerstouseU.S.currencyfortheirtransactions.23 Thesedrugsarenotbeingproduced

withinthecountry,onlymerelytransportedacrosstheborderfromtheirneighbors. Ecuadorneedsto

identifythetransportationroutesandmethodsoftransportationaswellascombatanynewshipments

fromcrossingtheborder.

Political:RelationshipwiththeUnitedStates

ThesecondissueaddressespoliticalinstabilityandtheirpositionwiththeUnitedStates.

Ecuadorexperiencedpoliticalinstabilitybetween1997and2006. In1996,PresidentAbdalaBucaram

waselectedanddismissedshortlyafteronthegroundsofcorruption. In1998,JamilMahuadwas

electedPresidentandwasassistedbyGustavoNoboa. Mahuadleadthecountryduringatimeof


25/39

increasingeconomicandfinancialdifficultiesbutwasunabletocompletehisterm,ashefledthepalace

onJanuary21,2000,atwhichtimeNoboabecamehissuccessor. NoboahelpedtorestoreEcuadortoa

levelofstabilityandgrowthprimarilyledbytheadoptionoftheU.S.dollarastheofficialcurrency.

NoboawasabletoleadEcuadorintoatimeofeconomicexpansionbecauseofthelackofcorruption

duringhistenure.

BoththeUnitedStatesandEcuadorareinterestedincombatingthedrugtraffickingoriginating

ontheEcuadorianborders,improvingeconomicdevelopmentinEcuador,andreducingpovertyforall

citizens. Thestrongrelationshipbetweenthesetwocountriesislargelyinpartduetothenumberof

EcuadorianslivingintheU.S.andthenumberofAmericansvisitingtheGalapagosIslands.TheU.S.

providedcloseto$60millionineconomicassistancetoEcuadorin2009.24TheU.S.assistsEcuador

throughorganizationsthatincludetheU.S.PeaceCorps,theStateDepartmentsNarcoticAffairs

Section,andtheAgencyforInternationalDevelopment.

ConclusionCurrentStatus

EcuadorisstrivingtoachievethetargetsthatweresetfortheMillenniumGoals. Theyhave

seenadrawbackinthelevelofextremepoverty;experiencedahighlevelingrossandnetenrollment

withintheprimary,secondary,andtertiaryeducationlevels;reducedthegenderequalitygapinterms

ofemploymentintheindustryandservicesectors;andincreasedinthenumberofwomenengagedin

parliament. Inaddition,childmortalityratesandmaternaldeathrateshavebeenconsiderablyreduced.

ThespreadofHIV,AIDS,malaria,andotherdiseaseshasbeenhaltedandareversalprocesshasbegun.

Boththereductioninmortalityratesandspreadofdiseaseshasledtopopulationgrowth. Ecuadoris

verycapableofreachingadevelopedlevelby2015. Politicalcorruptionhasbeenreduced,

environmentalissuesarebeingaddressedandcorrected,andtheyareworkingtoachieveself


26/39

sufficiencyfromforeignaid. However,Ecuadormustincreaseitseducationalexpendituresifithopes

forfurtherfuturedevelopment.

ProgramRecommendationsStage1

Ihaveofferedasignificantnumberofrecommendationsforprogramsandinitiativesthatwill

allowEcuadortomeetorexceedtheMillenniumDevelopmentGoals. Theserecommendationscanbe

brokenintothreestages,eachofwhichwilladdvaluetothepreviousefforts. Overall,thegoalofthe

UNistoimprovethequalityoflifeforallindividualsintheworld. EcuadorcanhelptheUNachieveits

goalbyimplementingmyrecommendationsinthreestages.Thefirststagewillidentifyprogramsin

Ecuadorthatarebeingannuallyfunded,butnotimproved,andrequirelittletonocapitaltoimplement

Expertsshouldbehiredtoresearchalternatemethodsofprovidinggoodsorservicesinprogramsthat

canbeselfsustaining,ratherthanprogramsthatareburdenonthegovernmentsfinancialresources.

Theseselfsustainingprogramsareresponsibleforcreatingarevenuestreamthroughfeesandother

methodstocoveralloftheirexpenses. Theseprogramswillbemanagedinthesametraditionalmanner

asnonforprofitprograms. Thefreetradeagreementsthatarecurrentlyinnegotiationsneedtobe

completedasawaytoincreaseexportsandcreateaccesstonewmarkets. Afterthegovernment

restructuresexistingprogramstoeliminatewastefulspending,theirspendingcanberedirectedinto

subsidizedfarming. Throughsubsidizedfarming,Ecuadorwillseeanincreaseinagricultural

productivity. TheincomereceivedfromtheIMF,U.S.,andothercountriesshouldcontinuetobespent

forthe

purposes

that

it

has

been

sent

to

achieve.

Another

recommendation

in

this

stage

is

to

illegalize

HCFCsandotherharmfultoxinstocombatozonedepletion. Myotherrecommendationscallfor

stricterenvironmentalregulationstocombatdeforestationandalsoenactingalawthatrequireswomen

toholdacertainpercentageofseatsinnationalparliament.


27/39

Stage2

Thesecondstageofrecommendationsfocusesonimprovingbusinessesandhealth. Thefirst

programofthisstageistocreateastrongmicrofinancesectorthatencouragesEcuadorianstocreate

theirownbusinesseswhentheyareunemployed. Thegovernmentneedstosetasidefundsthat

guaranteeacertainamountofmoneytostartupbusinesses. Thiswillallowpeopletheopportunityto

createabusinesseveniftheywouldnotbeabletogettheloanfromabankwithoutthehelpofthe

government. Instage1,governmentfundedprogramswererestructuredtoeliminateallwasteful

spending. InthisstageitisnecessarytofocusoneducationalexpendituresasapercentageofGDP. By

increasingeducational

expenditures,

there

will

be

the

ability

educate

teachers;

provide

new

textbooks

andtechnology;andensurethateverystudentcanattendaschoolthatisinreasonableproximityto

theirhomes.Improvementsingenderequalityshouldalsooccurinthesecondstage. Thegovernment

shouldlaunchanincentiveprogramprovidingtaxcreditstobusinessesthathaveestablishedtraining

andrecruitingprogramsthatrecognizegenderequalityanddonthaveapayscalethatisgenderbiased.

Myfinalrecommendationinthesecondstageistoprovidewomenwithanincentivetobreastfeed. This

couldbeanincreasedtaxoninfantformulaorcreatingamandatorydocumentthatneedstobesigned

whenpurchasinginfantformulawhichoutlinesthebenefitsofbreastfeeding.

Stage3

Thethirdstageofrecommendationsfocusesonimprovingmortalityratesbycombatinga

numberofproblems. Afterimplementingtherecommendationsinthefirsttwostages,thegovernment

shouldnolongerbefinanciallyobligatedtopoorlydesignedprograms. Myfirstrecommendationin

stagethreeistosetupmobilehealthcentersthroughoutthecountry,withmorehealthcentersbeing

placedinhighpopulationdensityareas. Atthesehealthcenters,patientswillbeprovidedmosquito

netstohelpstopthespreadofdisease. Thesecenterswillalsohavefreeinformationonhealthyliving


28/39

andonsitehealthprofessionals. Thesehealthprofessionalscanaidwithsafebirth,offerassistanceto

peoplelivingwithdeadlydiseases,andadministerimmunizationsagainstdeadlydiseases. Thereare

manybenefitsofhavingthesehealthcentersasmobileunitsinthisstageofEcuadorsdevelopment.

Twobenefitsincludebeingabletoreachpeoplethatcanttravel,theywillbeabletotraveltowhere

theyareneededmost. Myfinalrecommendationinthisstageistoprovidetaxrelieftocellphone

subscribersandsmallbusinessesthathaveembracedtheinternettogrowtheirbusiness. Thecoststo

benefitsofeachprograminthethreestagesarealigned. Themostcapitalintensiveprogramsarefound

inthethirdstage. Afterimplementingallofmyrecommendationsinthethreestages,Ecuadorshould

befinanciallysecureandhavecapitaltoinvestinitspermanentinfrastructure.Improvementstoits

permanentinfrastructureincludecreationofnewroadways,airports,hospitals,andanupgradeto

telecommunications.


29/39

Appendix

Figure1.1

Table1.1

$0

$20

$40

$60

$80

$100

$120

$140

$160

CrudeOil

Price

per

Barrel

DailyOilPriceSource:IOGA

Source:IOGA


30/39

Figure1.2

Figure1.3

0.00%

0.02%

0.04%

0.06%

0.08%

0.10%

0.12%

0.14%

2,500,000

3,000,000

3,500,000

4,000,000

4,500,000

5,000,000

5,500,000

6,000,000

6,500,000

7,000,000

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

GrowthRate

Population

GrowthRateofGDPperPersonEmployed

PopulationEmployed(15+) GrowthrateofGDPperPersonEmployed

Source:CIA TheWorldFactbook

Source:IndexMundi,myCalculations,U.S.CensusBureauIDB


31/39

Figure1.4

Figure1.5

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

PercentageofIncome

PercentageofPopulation

LorenzCurve

1995 2003 2005 2007 LineofPerfectEqualitySource:WorldBank

0

10

20

30

40

50

60

1998 2000 2003 2006 2009 2010

GiniCoefficient


32/39


33/39

Figure1.8

Figure1.9

800 600 400 200 0 200 400 600 800

04

1014

2024

3034

4044

5054

6064

7074

8084

9094

100+

Population(Thousands)

AgeGroups

2010AgeDistribution Females Males

0

10

20

30

40

50

60

70

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

MortalityRateper1

,000Births

%of1YearofChildrenImmunized

ReducedChildMortality

Infantmortalityrate(per1,000births)

Under5mortalityrate(per1,000births)

Child1yr.oldimm.measles

Sources:U.S. CensusInternationalDatabase&IndexMundi

Source:U.S.CensusBureau,InternationalDataBase


34/39

Figure2.0

Figure2.1

0.000

0.100

0.200

0.300

0.400

0.500

0.600

0.700

0.800

$

$1,000

$2,000

$3,000

$4,000

$5,000

$6,000

$7,000

$8,000

2000 2001 2002 2003 2004 2005 2006 2007 2008

IncomeIndex

GDP(PPP)

GDP(PPP)/IncomeIndex

0.500

0.550

0.600

0.650

0.700

0.750

0.800

0.850

0.900

2000 2001 2002 2003 2004 2005 2006 2007 2008

IndexValue

Year

HumanDevelopmentIndex

HDI EducationIndex IncomeIndex LifeExpectancyIndex

Source: 2008WorldDevelopmentIndicatorsCD&Authors'Calculations


35/39

Figure2.2

Figure2.3

0

10

20

30

40

50

60

70

80

90

100

1990 1995 2000 2006

ProportionofPopulation

Year

ProportionofPopulationUsing

ImprovedDrinkingWaterSources

Rural DrinkingWater

Urban

DrinkingWater


36/39

Figure2.4

Figure2.5

0

10

20

30

40

50

60

70

80

90

100

1990 1995 2000 2006


Year


UsingImprovedSanitationFacilities

Rural SanitationFacilities

Urban SanitationFacilities

Total SanitationFacilities

Source:IndexMundi

0

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

1989 1994 1999 2004 2009

TotalUsers

Year

TotalInternetUsersandCellularSubscribers

(per100

Population)

InternetUsers

Cellular

Subscribers

Source:IndexMundi

Note:Bubblesizerepresentsusersper100population


37/39

Figure2.6

0.00%

0.50%

1.00%

1.50%

2.00%

2.50%

0

50

100

150

200

250

300

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

Millions

Year

OfficialDevelopmentAssistance(IMF)

ForeignAid

Aidas%ofGDP

Source: WorldBank


38/39

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39/39

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2010..

24

"Ecuador." U.S. Department of State. 24 May 2010. Web. 16 Apr. 2011.

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Documents

Ecuador Economic Development Position