Introduction to International Politics

Foreign Event Analysis

Locale[]
Ecuador
Title
Correa Puts His Foot Down
Summary
The president of Ecuador, Rafael Correa, has ordered all members of the Brazilian construction company, Odebrecht, to leave Ecuador. Odebrecht owns the hydroelectric power station San Francisco in Ecuador, which had ceased functioning earlier this year. Ecuador is asking Odebrecht for reparations for the losses accumulated due to this power station being out of commission. Correa has ordered Odebrecht out of the country because it refuses to pay these reparations. He has also mobilized the Ecuadorian army to take hold of all of Odebrecht’s property located within Ecuador’s borders.
Analysis
Ecuador and the Brazilian construction company Odebrecht had been negotiating for weeks to settle on an agreement about the reparations. On September 23, both sides were seeing each other as being stubborn, and then the Ecuadorian president, Rafael Correa, finally had had enough. Since their negotiations with Odebrecht had broken down, Correa was forced to act.
Because of this situation, interdependence between Ecuador and Odebrecht has been disrupted. Odebrecht was a main contributor in powering many regions of Ecuador. Correa, as well as Ecuador, depended on this company to keep the hydroelectric power station San Francisco running efficiently. Subsequently, Odebrecht has broken the trust of Ecuador by not fulfilling its obligations as the owner of San Francisco. One could say that not only did Ecuador depend on Odebrecht, but Odebrecht also depended on Ecuador. Ecuador was a very important client of Odebrecht’s. Just imagine having a country as a client. Odebrecht is losing millions upon millions of dollars by losing Ecuador as one of its clients. Since negotiations between Odebrecht and Correa have broken down, the interdependence between Odebrecht and Ecuador has been upset.
By kicking Odebrecht out of the country, Correa is running the risk of losing Brazil as an ally. Brazil may see Correa’s declaration as an attack on their international policies. Brazil believes that international businesses are very important and they avidly support the growth of those Brazilian businesses. Brazil sees the benefits of these businesses and sees the prosperity that Brazil and Ecuador can achieve through having healthy negotiations. Correa is severing ties with Brazil that may entail future breakdowns between the two countries. A situation at the individual level of analysis, Ecuador vs. Odebrecht, may turn into a situation at the foreign policy level of analysis, Ecuador vs. Brazil.
Perspectivel
Liberal
In-Region URL
Out-of-Region URL
Submitted
September 25, 2008 at 8:42 pm