Quito (AFP)

The violent social crisis that has rocked Ecuador for the last ten days was triggered by the announcement of economic reforms, in exchange for a loan from the IMF, whose main measures are as follows.

While rising gas prices are the most criticized by protestors, the $ 4.2 billion check by the International Monetary Fund (IMF) also includes other conditions, such as the two-for-one vacations of civil servants or the reduction of certain taxes.

A first decree of economic measures came into effect on October 3, while the labor and tax reforms will be presented by President Lenin Moreno before the National Assembly for their approval.

- Decree of Economic Measures -

1. Removal of fuel subsidies, which cost the state $ 1.3 billion a year. The measure boosts pump prices by up to 123% and public transport fares by up to 40%.

2. Increase of $ 15 in social assistance for 1.1 million beneficiaries who had previously received $ 50 to $ 240 per month and 300,000 additional families.

3. Division by two of customs duties in the agricultural and industrial sector, for example for the acquisition of machinery.

4. Encouraging the construction of housing with the provision of a billion dollars for credits at a rate of 4.99%.

- Labor reforms -

1. Creation of new contracts, including temporary contracts with no minimum duration, which may be per hour.

2. Hiring and firing facilities for new businesses and new replacement contracts for maternity, paternity or critical illness leave.

3. Incentive to telework.

4. Retirement contribution of 2% of salary for employees working for 25 years in the same company, which can be paid to a private fund.

5. Reduction of civil servants' holidays from 30 to 15 days a year, to adjust them to those of the private sector and increase their productivity.

6. Employees of public enterprises will have to "give" the state one day of salary per month.

7. 20% reduction in compensation for contract employees in the public service.

- Tax reforms -

1. Special tax for three years - totaling $ 300 million - for companies with a turnover of more than $ 10 million in 2018.

2. Lower taxes for banana producers.

3. Division by two of the tax on the outflow of foreign exchange for raw materials.

4. Reduction of customs duties on the import of vehicles of up to $ 32,000 for professional use.

5. Elimination of customs duties on the import of mobile phones, computers, tablets.

© 2019 AFP