9/9/13

Ecuador wants wealthy countries to pay it not to develop an oil deposit - The New York Times

EL COCA, Ecuador Under pressure to preserve the environment while also easing the poverty of his people, President Rafael Correa has come up with an unusual solution. Correa wants wealthy countries to pay Ecuador $350 million a year in exchange for leaving an estimated one billion barrels of oil under the ground in the pristine Yasuni rain forest. "I think oil has brought us more bad than good," Correa said during a recent visit to the bustling Amazonian oil town of El Coca. "We need to do something about it." Environmentalists around the world have celebrated the idea, apparently the first of its kind, as a way to preserve a delicate environment without creating an economic burden for a country where 6 in 10 people are poor. The move comes amid growing popularity of "carbon offsetting," in which people concerned about climate change make donations to compensate for the environmental damage caused by their consumer habits. But critics wonder if the politically unstable Ecuador, which relies on oil for nearly half of its export revenues, can keep a promise like this to the international community. The plan involves creating a trust fund for donations or accepting debt pardons from other countries or multilateral lenders like the International Monetary Fund. The $350 million would constitute about half what Ecuador said it could make each year from extracting oil from the field, partly located inside the Yasuni National Park. Alberto Acosta, a former energy minister, has pointed out that all the oil in the field would only be enough for 12 days of global crude consumption. Government officials said that Norway, a group of Italian lawmakers and even an unidentified oil company had asked about the plan. "It sounds ridiculous, but when you compare that money with Ecuador's foreign debt it's actually a small quantity," Matt Finer a scientist with the coalition Save America's Forests, said. The Yasuni is home to species ranging from endangered white-bellied spider monkeys to rare jaguars that share the forest with indigenous groups that live isolated from the outside world and hunt with spears and blowguns.
www.nytimes.com/2007/07/23/business/worldbusiness/23iht-ecuador.4.6792787.html?pagewanted=print 1/2

9/9/13

Ecuador wants wealthy countries to pay it not to develop an oil deposit - The New York Times

Correa, an ally of the Venezuelan president, Hugo Chvez, startled Wall Street by threatening not to pay Ecuador's foreign debt of $10.3 billion. He is embroiled in a power struggle with lawmakers in Ecuador who say he is scaring off oil investment. He also openly backs a $6 billion lawsuit filed by indigenous groups that accuse the U.S. oil company Chevron of polluting the Amazon. Detractors of the proposal say that Ecuador cannot ensure the sanctity of the vast park given the political turmoil that has at times halted oil operations and has helped make Correa the eighth president in just 10 years. "Correa is asking the international community to dive in to see if there is water in the pool," said Daniel Erikson of the Inter-American Dialogue, a research institute in Washington. Correa has said that Ecuador would begin oil development next year if the government cannot secure the funds by then. Even if Ecuador can halt contamination by oil behemoths, it may struggle to control an equally serious threat to Yasuni - the migrants who are already setting up farms and shantytowns, some in hopes of oil field jobs.

www.nytimes.com/2007/07/23/business/worldbusiness/23iht-ecuador.4.6792787.html?pagewanted=print

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