The role of international cooperation,

transnational interests and local power in

the (failed) privatization of the electricity
sector in Ecuador

Andrés Chiriboga-Tejada

Kyoto, Japan – June 23rd, 2018

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 Neoliberalism in Ecuador

▶  First policies Washington Consensus

guided policies implemented in the early
1980s
▶  Less profound reforms compared to
other countries

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The path of structural
reform in Ecuador

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The path of structural
reform in Ecuador

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2002

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Putting the pieces together

The capacity of transnational actors to influence States is

contingent to three factors (Risse-Kappen, 1995):

▶  International Institutionalization
▶  Internal institutions
▶  Coalitions

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Multilateral
cooperation-conditionality

▶  The role of the WB and IMF after the debt crisis in Latin
America
▶  Multilateral cooperation + credit conditionality

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Multilateral loaning with
conditionality

▶  Key loans for the privatization of the electricity sector

under conditionality schemes:
▷  3821 EC/BM for Technical Assistance for the Reform of Public
Enterprises (PERTAL)
▷  3822 EC/BM for Technical Assistance for the Modernization of the
State (MOSTA) with the World Bank.

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“ We considered that Salomon [Smith Barney] had
made an apparisal without considering certain
issues that could well increase the value of the
companies. (....) We came up with a higher value
with technical arguments and we told Salomon
[Smith Barney] : well, what happens is that you want
the total success for the process and at the price,
you are for sure going to sell but having a very
significant impact for us.”

▶  Ricardo Noboa Bejarano (Interviewed in 2008)

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Advisors and potential buyers

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The legal infrastructure for privatization
•  With experts financed by PERTAL
Electricity Sector Regime Law project/loan
1996 •  Divided the Ecuadorian Electricity
Institute (INECEL) into different
companies

Constitution •  Strategic sectors are subject of

1998 privatization (Art. 249)

•  State can sale 51% of its stocks I the

Trole I and II Laws electric corporations
2000 •  Electricity is one of the areas subject
of privatization
•  The National Electrification Plan is
only referential

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The role of local political and social actors

The National Government

The Social Christian Party

The Socialdemocrats - ID Indigenous and Labor Unions

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Thank you for your attention!

andres.chiriboga@sciencespo.fr
@AndresChiriEC
www.andreschiriboga.com

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