Sun | Jan 21, 2018

Ecuador hikes taxes to pay for post-quake reconstruction

Published:Friday | April 22, 2016 | 12:00 AM
Soldiers tell a man where he can line up for free food and water from the government, days after the earthquake in Manta, Ecuador, yesterday.


President Rafael Correa said Ecuador's worst earthquake in decades caused billions of dollars of damage and he is raising sales taxes and putting a one-time levy on millionaires to help pay for reconstruction.

The damage from the 7.8-magnitude quake adds to already heavy economic hardships being felt in this OPEC nation triggered by the collapse in world oil prices. Even before the quake, Ecuador was bracing for a bout of austerity, with the International Monetary Fund forecasting the economy would shrink 4.5 per cent this year.

In a televised address on Wednesday night, Correa warned the nation of a long and costly post-quake recovery and said the economic pain shouldn't fall only on hard-hit communities along the coast.

"I know we're at the most difficult stage right now, but it's just the beginning," he said.