Ecuador's Comptroller Accuses Rafael Correa of Debt Mismanagement

Ecuador's Comptroller office suggested that former President Rafael Correa was responsible for mismanagement of the national debt between 2012 and 2017, calling for a criminal sentence and administrative fines.

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The report was presented by comptroller Pablo Celi, who led a 9 month investigation into Correa's management of public debt, finding him guilty of modifying the debt's equation by a presidential decree in order to acquire new debt without consulting the assembly and prevent it from reaching the 40 percent debt ceiling.

According to the accountability office, Presidential Decree 1218 established a new equation for calculating the public debt in relation to the country's GDP, not taking into account oil pre-sales to “artificially” reduce public debt, which was at 38.6 percent of the GDP at the time of the decree in October 2016.

But Correa had previously declared that oil pre-sales shouldn't be considered in public debt, since they are actually trade operations. To support his arguments, Correa quotes Article 130 of Ecuador's financial legal code, which establishes that “the pre-sale of a public company's goods and services is not considered public debt,” permitting the sales of Petroecuador, the country's national oil company, not to be taken into account by the debt committee.

The decree also establishes that public debt should be calculated using the International Monetary Fund's standards, but the accountability office claims that not all of their mechanisms were taken into account.

“Even minister Elsa Viteri refuted it yesterday, but none of that matters in the quantum country. A 'criminal' responsibility for calculating the debt according to the IMF's manual,” wrote Correa in his Twitter account after the report against him was published, also quoting the recently arrested Lula da Silva:

“The criminals are the ones accusing me.” Correa has accused Celi and his team of persecution with political intentions, while rejecting the report's conclusions.

The leftist former president has been an outspoken critic of the current government of his former ally Lenin Moreno, accusing him of reversing his governments' socialist policies, appeasing the right-wing opposition in the country as well as politically prosecuting his allies as the case with former Vice President Jorge Glas, who is serving a six-year sentence over alleged bribes related to the Brazilian construction company Odebrecht.

The country's auditor office also placed responsbility for the debt mismanagement on former finance ministers Fausto Herrera and Patricio Rivera, who served in Correa's administrations, along with former public financing sub-secretary and the finance ministry legal coordinator.