Corruption and COVID-19 in Ecuador

On March 11, 2020 the World Health Organization¹ declared COVID-19 a global pandemic. On the same day, Ecuador’s government declared a state of emergency and shortly thereafter announced a curfew, due to the increasing presence of the disease in the country following the first confirmed cases in late February.²

A month before the state of emergency was declared, the former vice president of Ecuador, Maria Alejandra Vicuña, was sentenced to prison by the National Court of Justice. She stood accused of having forced workers to pay a percentage of their wages to her political party, Alianza Pais, what is known as the crime of “concussion.”³ Parallel to this, the State Attorney’s Office of Ecuador started a “fight against the pandemic of corruption”⁴ within Ecuadorian hospitals. So far during the pandemic, it is estimated that the state has lost at least $17 million through corrupt management of the healthcare sector.⁵ All this accords with the work of Transparency International, which found that Ecuador`s level of corruption has increased substantially in the last seven years, climbing twenty-one places on the international ranking of the most corrupt countries. Ecuador is now ranked 93 out of 198 countries on Transparency International’s Corruption Perceptions Index.⁶ In 2019, Ecuador scored only 38 out of 100 points (0 being most corrupt and 100 least corrupt). Ecuador has become one of the most corrupt countries in Latin American. The slogan of Ecuador’s President Moreno, to “fight against corruption,” has failed spectacularly.

The corruption and poor management of the public sector in Ecuador, particularly the healthcare system during the pandemic, appear to demonstrate a fundamental lack of respect for the life of Ecuador’s population. Hospital managers bought overpriced medical equipment and unnecessary medicines to generate personal profit, and all the while public hospitals operate above the maximum patient capacity. Hospitals lacked critical equipment such as respirators and lacked emergency plans to deal with a crisis such as COVID-19. Some dead bodies were abandoned, while others simply disappeared, and private hospitals and clinics refused to treat emergencies without the guarantee of a credit card. Many of these issues existed before, but the pandemic has laid bare the precarious reality of the Ecuadorian health system: the government—from those at the top all the way to lower administrative roles—was both unable to manage the crisis and morally unfit to do so. As a result, not even two weeks into the pandemic and the declared state of emergency in Ecuador, the Health Minister announced her resignation.⁷

Corruption at Different Levels during the Period of COVID-19

At the beginning of Moreno’s tenure in 2017, his political campaign partner and vice president, Jorge Glass, was imprisoned for criminal offenses relating to the mismanagement and misappropriation of public funds, some of which were related to the wave of corruption involving the Brazilian multinational corporation Odebrecht. This gave the impression that corruption indeed was going to be brought to a halt. However, even after this, Moreno’s government continued to appoint corrupt former politicians, their family members, and their close friends, some known specifically for the mismanagement of hospitals across the country. This appeared to foreshadow problems ahead.

Unfortunately for the people of Ecuador, and particularly for those in need of food, shelter, and public services and healthcare, corruption and misappropriation of public funds has become the norm rather than the exception during the pandemic. As hospitals and other public health centers purchased equipment and medicine to respond to COVID-19 cases, the state of emergency allowed managers to bypass the normal procedures for accountability in contracting. According to the General Comptroller of the State, there have been fraudulent and corrupt contracts for items ranging from bags for dead bodies to overpriced mechanical ventilators, with losses in public funds totaling $17,887,852.⁸ Those involved in these schemes include the former Secretary of State for Emergency and Risk Management in Moreno’s government, Alexandra Ocles, Ecuador’s former president Abdalà Bucaram and his sons,⁹ as well as members of the local police force in Quito.

As a result, one of Abdalà Bucaram’s sons is seeking asylum in the United States, while an arrest warrant has been issued for another son under investigation for misappropriation of public funds related to the management of a hospital in Guayaquil. Meanwhile, the police recently arrested former president Bucaram himself, who is accused of corruption involving organized crime.

Corruption in the context of COVID-19 extends beyond Ecuador. The case of the Bucaram family has implicated two Israeli nationals who seem to have been involved in the illegal transaction of medical supplies with Bucaram’s son Jacobo.¹⁰ The detention and subsequent imprisonment of these two Israeli men, and the assassination of one of them in prison, suggest that the corruption and mismanagement of public services takes place at a very high level.¹¹

Corruption and Mismanagement in the Hospitals

Corruption and mismanagement of public hospitals in Ecuador was an issue of concern to the Ecuadorian Office of State Attorney and the General Comptroller of the State even before the pandemic began. In addition, there were public complaints about the lack of coordination between the central government and the local authorities, particularly in Guayaquil in late March and early April, as government authorities showed little interest in or respect for the lives of the population. Widespread complaints about the poor service provided by hospitals, the lack of appropriate equipment for doctors and nurses, and the failure to control the contagion intensified as the number of COVID-19 cases and deaths continued to rise.

Many families lost relatives in Guayaquil hospitals without receiving even the most basic information about where or when they passed away.¹² Meanwhile, Carlos Luis Morales, the representative of the central government for the province of Guayas, along with other officials from Guayaquil, were being investigated by the Office of State Attorney for irregular contracts and abuse of influence.¹³

Thus, by middle of September, The General Comptroller of the State conducted 208 audits in response to public complaints and signs of corruption. Of these audits, 119 concerned public hospitals and related health centers, while 89 were conducted in regard to central and local authorities, ranging from the institutions related to the presidency to rural local governments. The General Comptroller stated that many of these cases were subject to criminal prosecution.¹⁴ The sheer scope of the corruption suggests a widespread collapse of ethical standards among those in positions of social and political responsibility.

COVID-19 and the New Debt

At the beginning of May, President Moreno announced that $1 billion in external funding has been made available to counter the effects of COVID-19, and to reactivate the economy of the country by offering loans through the national banking system.¹⁵ What has not been clear since are the costs of these credits for the country, and how these funds are going to reach the most disadvantaged populations.

While the International Monetary Fund confirmed a loan of about $643 million for the health system and other sectors most affected by the virus,¹⁶Alexandra Ocles, a central figure in the crisis management of COVID-19, was being investigated for mismanagement and overpriced purchase of food kits. Shortly after that, in the middle of a corruption scandal, she was forced to resign.¹⁷

A few days later, the World Bank announced a credit of $500 million to help the government confront the impact of COVID-19 in the country,¹⁸ even as complaints about the lack of support for doctors, nurses, and health service personnel increased. At about the same time, the official number of infected people in the country surpassed the 10,000 mark.¹⁹ However, this figure was widely viewed as not credible, as the number of infected people did not take into account the infected people in rural areas, for example. In addition, there was no official estimate of the number of deaths caused by the virus. The public defender’s office demanded greater transparency regarding COVID-19 case data, specifically demanding that the government take steps to more accurately identify the deaths of hospital patients resulting from the disease.²⁰

The corruption and mismanagement continued apace. In May, while the external funds from the IMF were en route, the new Health Minister, Juan Carlos Zevallos, announced that at least $200 million would be directed to respond to the COVID-19 crisis. Only a few weeks later, the same minister publicly requested that the State Comptroller investigate hospitals and health centers due to signs of financial irregularities and poor management.²¹ On June 2, the State Attorney General announced that forty-five new cases of corruption related to these issues were under investigation.²² Even though it is clear that some offices within the government have tried to do what they could to prevent the embezzlement of public funds, the new wave of scandals suggests that these efforts have done little to deter corruption. While the government has sought support from other states and international organizations, because of the embezzlement by government officials, and the failures of the healthcare system, those resources have not done much to reduce the incidence of COVID-19 cases or the mortality rate.

Under the best of circumstances, the efforts by the government would not be sufficient in themselves to control further infection of the population. It is also necessary for individuals and their families to have a sense of responsibility and to adopt the suggested public health measures—such as social distancing—in their private lives, made all the more challenging by the economic and psychological impact of five months of confinement. But the indifference and rampant corruption on the part of the state have made the situation much worse than it needs to be.

In addition, it seems that the additional debt burden has done little to ameliorate the situation of those most affected by the pandemic. This is particularly worrying as the number of infected people constantly increases. The most recent report by the Office for Risk Management showed that, as of November 29, 2020, there were 192,117 COVID-19 cases and 13,423 resulting deaths.²³ However, the number of “unjustified” deaths as of November 26 had reached 25,000—nearly double the official count.²⁴ This gap between the official numbers of justified and unjustified deaths demonstrates lack of transparency in the system. With this number, Ecuador stands among the Latin American countries with the highest COVID-19 cases and deaths per capita.²⁵

While this essay has centered only on political and administrative corruption in the context of the pandemic, much more could be said about the other contexts in which Ecuador experiences profound and ongoing corruption. Certainly, in the case of COVID-19, it is apparent that those who are profiting illicitly have little concern for the suffering that results directly from their actions. We could say that Ecuadorian society suffers from another disease—corruption—that seems to be as bad if not worse than COVID-19. Millions of dollars of public funds are continually redirected to the pockets of private individuals who do not seem to have moral principles or a sense of social and collective responsibility. Thus, Ecuador finds itself not only fighting against the COVID-19 pandemic but also against the pandemic of corruption.

—Raul Salgado Espinoza

Raul Salgado Espinoza is professor of International Relations at the Department of International Studies and Communication of FLACSO Ecuador. He holds a Ph.D. in Political Science and International Studies from the University of Birmingham, UK.

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