More on Ecuador’s Opportunities and Pitfalls

by | Oct 16, 2000 | Archives

I am not sure that Ecuador's current position is as optimistic as quoted in a recent USA Today article, but believe circumstances are much better than some who worry about problems with Colombian guerrillas suggest. I asked several friends who live in Ecuador and began their comments yesterday. here are more.

The first reply below is from an Ecuadorian businessman in Guayaquil:

Gary, in reply to your question, I do not think that matters have grown worse. They are in the same problematic level, or level of danger, as they were last month or the month before. If the indigenous movement takes advantage of it, we just have to put up with it. I do not think they will. They want to improve themselves, which can cause problems, but at the same time they are very aware that they do not know much about the Brits, French and the rest of the world, so they have to have patience.

When it comes to the Colombians, The situation has not changed since the days of the Independence one hundred and eighty years ago. The disadvantage now is that there is much more mobility – so things happen faster. The other side to this, is that if things happen faster, you hear about them faster also. No robber, terrorist, assassin, etc. wants to be criticised very quickly after he has committed his crime. Yes, the world is getting more volatile, nothing we can do.

Here is a reply from two American friends that own and run a farm near the capital of Quito.


Thank you for your email. We have a call in to Manta to find out how things are there and that should be in 10 minutes. In the mean time we can send some information. However, we do think intending residents should be made aware of the facts about malaria and dengue fever in all the coastal areas, which include Manta. We would not be prepared to live there ourselves, below about 3,500 ft. There were serious epidemics this last season.

We have been to Quito twice in the last 5 days and there is no sign whatever of violence there or en route (by day). However, we understand that there is quite a lot of robbery in the old city and on the road at night. This is not connected with the Columbia situation, but is due to the high rate of unemployment which has led a lot of young people to get in to crime as an alternative means of livelihood. We still feel safer here than we would in parts of Baltimore.

The situation is complicated because the Conaie (the union of indigenous people) try to do everything they can to embarrass the government because they object to the reform measures, which as you know are necessary to put the economy on a firm basis. The Conaie has lost respect from both the people and the government because it became involved in some very fraudulent practices, including falsifying a referendum. The result has been that the last two strikes they tried to call were a complete failure. They have called a meeting for yesterday and today, but we understand from the Comercio that it is at least partly to discuss their own shortcomings, as some of their people realize they have lost respect. It is also reported that they are discussing whether they should call another strike after a meeting which is scheduled for today with the government.

The situation at Manta is complicated because apparently the US people there have acted very badly in not respecting Ecuadorian laws at the new base which the Ecuadorians gave them permission to open there. They have landed planes without permission among other things. As a result congress is debating whether they should cancel the agreement for the Manta base or at least modify it.

As far as the Columbia situation is concerned, our main source of information is via the internet. There is an excellent page at, which is very reliable and gives articles and news from all over the world, papers such as Financial Times, and many others. If you look up this page and they have several past days available, and I think you would find this very helpful. Ecuador has beefed up the forces on the border, particularly close to a new bridge that has been opened. El Comercio had articles saying that the Columbian guerrillas do cross the border from time to time, but evidently this has been going on for some time.

We have not found any effects from all this, except that we have heard that there have been some car jacking on the road between here and Quito, but as far as I know, in every case the robbers have been caught by the local police who seem to be really on the ball. Our workers insist that we should not be driving on the road after about 5.30 p.m. and we do agree with this.

You have probably heard that some of our mutual friends have had a great deal of trouble with the architect they employed, who has cost them a great deal of money, and does not give good service. We think people should be very careful about employing professionals here without advice from reliable local people.

We have just been in touch with Manta and unfortunately the man we know is on vacation, but we talked to the secretary and questioned her on how things are there. She said first of all that everything was lovely, but on questioning her again she said that there are some bad men and women, but they are mostly in the bad barrios but there are good places also and she does not have a problem. If we get any more information we will send it to you.

We think you will find very helpful to keep abreast of what is going on.

Love from us both to you both,

This final reply comes from a business friend in Quito.

Gary, thanks.

What we know is that there is a concern about what could happen with the Plan Colombia. There is a security problem along the border in the Amazon jungle, as it always have been. Apart from that we are not affected by the Plan. There may be a bigger immigration of Colombians due to the plan. I doubt that what you heard about Manta is true. It may be that the person was recommended to bring some kind of protection but I do not think this has anything to do with the Plan Colombia, rather the increase in crime across the country due to the problems with unemployment, etc. But I have not been in Manta since the last tour so things may have changed, but I doubt that.


I hope this gives you a better view by having looked at these opinions from the horses mouth.

My feelings are that,as is usually the case, stories in the news, good and bad are exaggerated. Ecuador does have economic problems and their neighbor Colombia is nearly in a civil war. Though crime has risen due to recent depression, most of the country is safer than its western counterparts. Problems of this sort create enormous opportunity for the hardy few pioneers that are willing to invest in places that do not have security lights and paved streets. When you tally the added risks with the low prices, this is an incredible place to live, visit and invest. I have lived, worked and invested in many dozens of countries and it is after comparing these risks with the added risk premium I feel I can earn, the place is a bargain. The people are friendly and peaceful by nature and this is a charming beautiful pace to be.

So I hope you'll join me here sometime. until then, good investing!