Did The Imf Drop The Ball In Ecuador?

By refusing a bailout, it may have made things far worse

Ecuadorans are used to hard times. But hardly anyone in this small Andean nation of 11 million can recall times as hard as these. The economy shrank by 7.3% last year--the largest decline since the central bank began keeping records in 1927. The banking system is in a shambles, and deposits have been frozen since March. Its currency, the sucre, has shed more than two-thirds of its value since it was floated last February, and hyperinflation looms. "The country is on its knees," says Santiago Rodriguez, a 32-year-old taxi driver in Quito, who supports a family of four on $12 a day.

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