New Year, New Life?

By Luis Fierro Carrión (*)

Twitter: @Luis_Fierro_Eco

In my first column in Diario "El Universo", published last January, I asked if 2020 would be a prosperous year. Obviously, my rather pessimistic forecast fell short in the face of cruel reality, which recalls the phrase of Queen Elizabeth II, "annus horribilis" (horrible year in Latin).

The COVID-19 pandemic (the worst pandemic since 1918-1920) gave way to the worst economic recession since the Great Depression of 1929. Unemployment levels soared worldwide and in Ecuador, reaching a record rate of 13.3% in June (in September it fell to 6.6%).

There were 40 thousand excess deaths in Ecuador until mid-December (0.22% of the population, the second worst rate in the world after Peru), and the health crisis left thousands of people with chronic diseases. Goldman Sachs estimated that Ecuador was third in the world in the level of contagion (33 % of the population), after Peru (39 %) and Mexico (34 %).

After such a distressing year, the last few weeks have brought some hope that 2021 will be better.

Towards the end of the year, medical authorities in the UK, the US and the European Union approved the vaccines for COVID-19 developed by BioNTech/Pfizer and Moderna. The UK also approved the Oxford/AstraZeneca vaccine. Vaccines have also been approved in Russia and China, albeit without a transparent and open regimen regarding their results (trials of the Chinese Sinopharm vaccine in Peru were suspended after some patients experienced severe neurological side effects).

Another ray of light was the election of Joe Biden as president of the United States, who will bring back a foreign and internal policy based on strategies, norms, multilateralism, and, in the case of pandemic control, on science.

A positive side effect of the pandemic was a 7% reduction in greenhouse gas emissions worldwide, mainly due to the reduction in the use of fossil fuels for transportation (vehicles and aircraft). It has been a practical experience of reducing unnecessary travel and allowing work from home for part of the population, which could lead to a more sustained reduction in emissions.

Although the annual climate conference (COP26) was postponed to 2021, a virtual “climate action summit” took place, in which proposals were presented to strengthen climate action plans (Nationally Determined Contributions, or NDCs).

Several Latin American countries presented more ambitious proposals, including Ecuador (which committed to decarbonization by 2050), Costa Rica (ratified its net emissions goal of zero in 2050), Peru (increased its emission reduction goal to 40 % until 2030), among others.

The award of contracts for wind generation projects in Loja and solar energy in El Aromo (a large plot of land that the Correa government flattened at a cost of $ 1,500 million, for a supposed refinery) was also announced. The two projects, with an investment of $ 400 million, will generate 320 megawatts.

The electoral campaign begins, with 16 or 17 presidential candidates (one candidate is still pending qualification). The average of the polls to date puts Guillermo Lasso, Andrés Arauz, Yaku Pérez and César Montúfar in the first four positions; there is likely to be a second round, and it will be settled between two of these four candidates.

These are clear options: one from the right, one from the center, and two from left-wing populism. Both Pachakutik and Correísmo have proposed to give a "universal basic income" to citizens in "electronic currency", which, as I wrote the previous month, would quickly lead to the de-dollarization and collapse of the economy.

There is hope that 2021 will be better than 2020, but it will depend, in the case of Ecuador, on the will of the voters.

(*) Updated translation of a column published in Diario “El Universo” on January 1^st, 2021:

https://www.eluniverso.com/opinion/2021/01/01/nota/9091186/ano-nuevo-vida-nueva