Nearly ten thousand Ecuadorean government employees were fired between February 27 and March 1, according to local media reports.
This came after President Lenin Moreno signed a deal worth US$4.2 billion on February 20 with the International Monetary Fund (IMF).
According to an IMF statement, agreement was reached on policy measures the government of Ecuador must implement to apply for the loan.
The IMF would then process the loans in the context of what it calls an Extended Fund Facility, set up "to assist member countries in overcoming balance of payments problems that stem from structural problems”.
In other words, the Ecuadorean government has to apply austerity measures, meaning a cut in social spending, job cuts and cuts to welfare.
In the Ecuadorian Institute of Social Security, 500 employees were fired.
According to lawmaker Pabel Muñoz, the government dealt the workers a “low blow. Behind every person who loses the job, there is a family that affects their daily sustenance”.
According to Cesar Bedon, a lawyer and adviser to an assemblywoman for the Cotopaxi province, this measure was taken by the government after US$207 million was eliminated from the state budget.
A similar deal with IMF was signed by the Argentine government resulting in widespread protest against inflation and austerity measures that undermined institutions depending on government spending.
[Abridged from Telesur English.]