The crowded waiting room was getting hotter as more people came in. Their impatient eyes looked out the tall buildings of Manhattan from the sixth floor where the Ecuadorian Consulate is located.
Hundreds of Ecuadorians visit the Consulate every day after president Donald Trump promised to deport immigrants, especially undocumented immigrants. There are an estimated 687, 000 Ecuadorians in the United States, 61 percent of them are foreign born according to The Pew Research Center.
“I am here to get my son an Ecuadorian passport,” said Andrea in Spanish, who did not want to give her last name. Many parents like Andrea who have U.S. born children are rushing to get their children an Ecuadorian passport so they will not have problems if they are sent back with their undocumented parents.
But most of them were at the Consulate to get a document called a “poder” (power). Poderes are documents that authorize Ecuadorians living in the United States to manage their property in Ecuador. When that document is signed, anybody can sell or buy property on behalf of that individual who signed it.
What does it mean for Ecuador’s Economy? The Economist Intelligence Unit categorized Ecuador as the seventh worse economy in the world. Ecuador has always had a fluctuated economy. In 2008 it suffered greatly when the prices of the oil dropped, but then it slowly improved as the new elected president Rafael Correa made some adjustments. Correa brought back the economy by investing in new roads, hospitals, schools and giving electric access to isolated regions.
However, he did not count with all the funds for public investments. It led him to increase taxes, borrow money from the Central Bank and the prices of oil dropped again.
Ecuador’s economy now has two positive events that could change it from being the seventh worse economy.
First, with so many Ecuadorians living in the United States that are buying property, opening bank accounts and transferring their money from American banks to Ecuadorian banks. These movements will inject value to lift the economy up.
According to Maria Ines Costa Vargas, the vice-consul of Ecuador more people are sending poderes to Ecuador compared to last year. In February 2016, a total of 373 poderes were sent to Ecuador compared to 623 poderes this year in the same month. Last year Vargas said, the poderes were mixed either to buy or just manage property, but this year they are mainly to buying more houses, lands and opening bank accounts.
“People are scared and they want to have a plan B,” said Vargas. “Almost all the poderes are for buying or opening bank accounts in Ecuador.”
Second, the upcoming presidential election has Ecuadorian hopeful that the new president will bring new reforms to help rebuild the fallen economy.
“People stopped spending money because the prices for everything went up,” said Jose Alveres a U.S resident who was in Ecuador six months ago. He said the economy could be better if Colombians and Peruvians who come to work in Ecuador spend in Ecuador rather than sending it to their countries.
The public stopped spending as the prices for everything went up. The idea of increasing prices was to make up for the low cost of oil. Ecuador has an economy highly dependent on oil production and public spending. During the years the price of oil decrease from $ 94 a barrel to $32 a barrel.
Another main factor why Ecuador is in the seventh worse economy is the 7.8 magnitude earthquake that happened in 2016. It affected Ecuador’s economy greatly, leaving over $3 billion in damage and killing 660 people. The already hurt economy began to worsen in every corner as people stopped spending more and companies began laying off employees left and righ.
Former president Rafael Correa borrowed $1.5 billion from China in order to bring the economy back, but in exchange, China asked that a 90 percent of oil shipments go to them for the next few years. Ecuadorians hope their new leader will change that as the country depends on oil and they need to be free from China in order to trade with other countries.
“Basically, now we belong to China if we don’t pay that money back,” said Alvares.
Ecuadorians who live in the United States and the new incoming president will determine the future of Ecuador’s economy.
“More money will be circulating with all of these movements,” said Vargas. “They are going to open their own business and create jobs.”