Ecuador: Claims for Debts to Local Governments Continue

On Wednesday, the Decentralized Autonomous Governments (GAD) in Ecuador are still complaining about the lack of payments from the National Government, which affects the development of these territories.

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The prefect of Pichincha, Paola Pabón, warned on Wednesday on the Teleamazonas channel that the information given by the government this week is biased. There are five prefectures in the country that have not received the resources, according to the official.

Pabon referred to statements made by the Minister of Economy and Finance, Juan Carlos Vega, who said on Saturday that the Ministry had paid 298.5 million dollars to the GADs.

We are concerned about this debt because unfortunately we are going to have to paralyse important works. These resources belong to our people so that the works can be carried out and the economy can be stimulated, he warned.

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La prefecta de Pichincha, Paola Pabón, señaló que cinco prefecturas del país no han recibido los fondos correspondientes a febrero y marzo, según los datos proporcionados por el Gobierno sobre los pagos a los Gobiernos Autónomos Descentralizados.

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— Ecuador En Directo (@EcEnDirecto) May 22, 2024

 The text reads, 

The prefect of Pichincha, Paola Pabón, pointed out that five prefectures in the country have not received the funds corresponding to February and March, according to data provided by the Government on payments to the Decentralized Autonomous Governments.

Pabón affirmed that the prefectures of Cotopaxi, Santo Domingo, Azuay, Manabí and Pichincha have not received the resources corresponding to the months of February and March and warned that apparently there is a discretional management by Finance to make these allocations.

This Tuesday, the prefect of Santo Domingo de los Tsachilas, Johana Núñez, also denounced through her social network X that this province has not received payment.

On 7 May, the National Assembly (parliament) passed a law requiring the executive to hand over the financial resources corresponding to the prefectures and municipalities, entities owed millions of dollars.

The law establishes that the financial resources will go directly from the single treasury account to the GADs, that is, to the accounts of the local administrations without an order from the Ministry of Economy and Finance.

Recently, the president of the Association of Municipalities of Ecuador (AME), Patricio Maldonado, denounced that the National Government maintains a debt of 800 million dollars with these demarcations, which is added to the amount pending with the prefectures.

Meanwhile, President Daniel Noboa blamed former president Guillermo Lasso for the lack of payments that still persists in the public sector.

Ecuador closed the year 2023 with a fiscal deficit of almost six billion dollars, the equivalent of five percent of the Gross Domestic Product (GDP).

In the midst of this financial situation, the government is awaiting a new loan from the International Monetary Fund (IMF) to improve liquidity; however, economists warn of the conditions imposed by the financial body to receive this loan and its consequences for the population.