Ecuador Names Diego Martinez as New Central Bank President
Diego Martinez, a 34-year-old economist, will head Ecuador’s central bank after President Rafael Correa pressured his cousin Pedro Delgado to leave the post after he admitted faking his university degree.
Martinez, Correa’s sixth central bank president since he took office in 2007, will replace Economic Policy Minister Jeannette Sanchez, who held the post on an interim basis since Delgado resigned in December, according to a statement on the Presidency’s website today. Martinez was previously the sub- secretary of the country’s education secretariat and also worked as an official at the planning and development secretariat.
Correa’s nomination of Martinez, who’s allied with the ideological left of the government, signals the government may toughen its policy of state intervention in the economy, said Vicente Albornoz, dean of the Universidad de las Americas business school in Quito. The central bank’s authority to set maximum rates means Martinez will be able to influence how much interest lenders clients, he said.
“Correa continues to surround himself with people who are dogmatically left-wing,” Albornoz said today in a telephone interview from Quito. “It’s a reaffirmation of the state model.”
Because Ecuador uses the U.S. dollar as its official currency, much of its monetary policy depends on that of the U.S. Federal Reserve. The country’s central bank was also stripped of its autonomy in a 2008 constitutional referendum, leaving Martinez with few tools as the head of an agency Correa has called irrelevant.
Martinez, who will be sworn in today at 12 p.m. Quito time, steps into the post one month before national elections in which Correa is the favorite to win another four-year term. The economy is forecast to expand 4 percent this year while inflation, already at its slowest pace in two years, is projected to ease to 3.82 percent in 2013, according to the Finance Ministry.
Ecuador’s government is currently working with U.S. authorities to force Delgado to return from Miami, where he’s been hiding out since fleeing Ecuador in December. Delgado is wanted for questioning over alleged dereliction of duty after admitting he never graduated from university and used a fake degree for more than two decades while occupying public positions requiring a college diploma.
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