Rafael Correa knows a thing or two about the power of Ecuador’s organized crime networks. Serving as the country’s president between 2007 and 2017, and as minister of the economy and finance in 2005, the politician, now forced to live in exile after being hit with trumped up criminal charges, noticed efforts during his presidency by Mexico’s powerful drug cartels to infiltrate the country’s security apparatus.
“In 2010, we saw the greater influence of Mexican drug cartels, especially the Sinaloa Cartel. So we tightened laws and controls,” Correa said, referring to the powerful criminal gang often characterized as one of the largest drug trafficking organizations in the Western Hemisphere, which controls Ecuador’s own powerful Los Choneros gang by proxy.
Correa’s government left Ecuador in the enviable status of one of the safest and most economically transparent nations in Latin America. Seven years on, thanks to “ideological fundamentalism and the imposition of neoliberalism” by his successors, the country has become one of the region’s most dangerous, with polling showing 64 percent of Ecuadorians don’t feel safe walking alone in their cities and towns, with merely 41 percent confident in the competency of local police, and 24 percent in the fairness of the justice system.
Ecuador suffered its most violent year in history in 2023, with nearly 7,600 homicides recorded (up nearly 70 percent compared to 2022). It now has the 11th highest crime rate in the world, and fourth highest in the Americas, according to the Global Organized Crime Index.
Along with financial transparency, a big part of the problem fueling drug trafficking has been the dollarization of Ecuador’s economy, Correa said.
“A dollarized economy is more susceptible to organized crime because it makes it easier to launder money. It has no exchange rate, no record of these [cartel] transactions,” the economist, who wrote several academic papers on the benefits of dedollarization prior to becoming president, said.
Correa pointed to a "great hypocrisy in the fight against corruption and drug trafficking" in Ecuador, because while the police and army have been called upon to fight criminals and murderers using bullets, there are no similar structures to fight cartel financing schemes which launder dirty money clean, something made possible by a global banking system dominated by the dollar.
He pointed out, for example, that in Ecuador and many other countries, if someone deposits $10,000 in a bank, financial authorities will automatically receive a notification. Meanwhile, if someone puts hundreds of millions of dollars offshore, they can remain completely unnoticed.
"We want to fight corruption and organized crime? Let’s fight offshores! But no one says anything because tax havens can be found in the US, Nevada, Florida, South Dakota, Delaware, in the former colonies of the British Commonwealth, in all the Caribbean islands, such as the Bahamas and Nassau. And also in Europe: Luxembourg, Andorra, Liechtenstein - countries with some of the highest per capita incomes in the world," Correa urged.
Commenting on the possibility of US intervention in Ecuador’s security crisis amid the rash of gang violence, the former president stressed that such a scenario would be a disaster for the country.
"We Latinos are very good at denying facts and believing in the impossible. When has US intervention ever worked? Colombia hosts seven US military bases and yet is still the world’s leading drug producer; I fear [the repetition] of the ‘Columbia Plan’ in Ecuador and I think it is coming up," Correa warned.
This article has been translated and adapted from a piece published by Sputnik Mundo, our Spanish-language sister site.