Real institutional reforms must be put in place in Latin America to safeguard individual liberties and facilitate wealth creation, entrepreneurship, and enfranchisement.  This is the message that Alvaro Vargas Llosa sent to Latin American reformers in his latest book, Liberty for Latin America. 

The book is a must read for those who are concerned about the future of democracy and market reforms in Latin America, and elsewhere in the world for that matter.  One issue addressed in great detail by Vargas Llosa is the re-emergence of populist regimes.  In countries with populist leaders, private ownership of resources is increasingly under threat, which is an issue of grave concern to business communities around the world as they search for strategies to deal with property expropriations and more restrictive regulations. 

Perhaps Alvaro Noboa and Rafael Correa, the two presidential candidates in Ecuador, should read the book.  They might get some ideas on what needs to be done as they gear up for the runoff election set to take place in late November.

One candidate threatens to renegotiate oil contracts and ensure that country’s coffers benefit as much as possible from high oil prices.  Another garners support from the poor by providing handouts, including consumer products and money.  There is no need to identify who is doing what – it does not matter. 

What both of the candidates seem to be missing at times, and what really matters, is a genuine policy debate that extends beyond political games and appeals to the public. 

A policy debate that realistically outlines ways in which people will be given more opportunities to succeed, move up the development ladder, build their own future, and gain ownership of their country is what Ecuador needs. 

What we are also talking about is a policy debate that gives the Ecuadorian business community a chance to outline the key obstacles lying in the way of increasing productivity and competitiveness and ways to overcome them. 

There is work underway in Ecuador to do just that.

CIPE has been working with the National Association of Entrepreneurs (ANDE) to generate awareness of competitiveness issues and spark the debate that gets the public to evaluate the concrete policies, rather than the empty promises, of presidential candidates.

During the month of September, ANDE held four seminars with presidential candidates on “Competitiveness and Changing Perspectives in the Private Sector.”  Participants in these seminars included representatives and members of local chambers of commerce, industry, banking associations, the tourism industry, as well as young political leaders; micro-entrepreneurs; and those in the agricultural, mining and construction sectors.

Four presidential candidates, including Correa and Leon Roldos, participated in these events, which received substantial coverage on television, radio, and in the newspapers. All of the presidential candidates that participated in these seminars committed to upholding ethical and moral principles, creating a productive and competitive environment in the country, advancing corporate governance principles in state-owned enterprises, and promoting economic stability.

CIPE has also been working with the Ecuadorian Institute for Political Economy (IEEP) to produce a weekly television show, Tribuna Liberal, and a weekly radio show, Contrapunto Liberal, to discuss the main economic and political issues affecting Ecuadorian society.  IEEP is one of the very few sources of this type of information in the country, and its programs were invaluable throughout the election process. 

Just two weeks ago, before the first round of elections took place, IEEP hosted Dr. Marco Proaño Maya, presidential candidate for the Movimiento de la Reivindicación Democrática Lista 34 party, on its weekly television program, where he discussed his economic platform.  IEEP also hosted Dr. Jaime Damerval, presidential candidate for the Concentration of Popular Forces (CFP), to speak on its radio program about his vision for Ecuador.  Other presidential candidates appeared on the organization’s television and radio programs before the election as well, speaking about their economic platforms.

In many discussions, corruption emerges as a primary issue of concern.  Different estimates put the cost of corruption at nearly $3 billion a year.

The Foundation for Development Alternatives (FA) is working to address this issue.  More than 120 local business leaders in all of Ecuador’s 22 provinces are currently being trained in methods for effective leadership in addressing corruption problems.  In the works are programs to create a network of business leaders, who can engage in oversight activities, organize debates with public officials, and conduct advocacy programs to reduce opportunities for corruption.

What programs such as these intend to do is build a political process that is based not on empty promises or populist statements, but on genuine commitment to reform and people’s understanding of what is really at stake. 

How can people make a decision without proper information, without careful analysis of the issues and strategies?  How can good policies be designed without input from businesspeople, small and large?

As Ecuador gears up for the runoff election, the international community should not be telling Ecuadorian citizens which one of the candidates is the better choice.  Citizens of Ecuador should be able to make an informed decision on which candidate can lead the country to achieve a higher level of job creation and investment, improved social services, and better citizen integration in political and economic institutions. 

Local think tanks and business organizations have a role to play in making sure that such decision-making becomes a permanent feature of these and future elections.  Ultimately, as Vargas Llosa put it, the solution to populism is the enfranchisement of all citizens, providing them with the opportunity to enter into the market.  This cannot be achieved until meaningful policies are designed and implemented.