Social economic situation of the country

Geographical situation | Population | Languages spoken | Economic resources
Concentration of wealth and poverty | Way of life | A definition of poverty

Geographical situation

Situated in the northeast of Latin America, alongside the Pacific, Ecuador is the smallest Republic in South America, behind Uruguay, totalising a surface of 255.970 Km² and 12,090,804 millions inhabitants (according to the last census in November 2001)..

POPULATION

Half-castes and natives equally compose 80% of the population. 14% of White people and 6% of Black people live in Ecuador.
45% of the total population of the country live in the Andean region, named the Sierra, and 50% live on the coast. Moreover, the national population is concentrated at 61% in the cities and at 39% in the rural world.

LANGUAGES SPOKEN

The mother tongues are Spanish and Quichua.

ECONOMIC RESOURCES

Ecuador has a great geographical richness, in the sight of the 4 natural regions, which compose it: the coastal plain, the Andean region, the Amazonian plain and the Galápagos Isles. This natural variety induces a great richness in natural resources.

The principal resources of the country are those coming from the agriculture and from the exploitation of petrol. The agricultural resources of the country are good and various, as proved by the production of bananas: indeed, Ecuador is the 1st world bananas producer up to 30%. In the Andean region, most of the cultivation is food crops: barley, potatoes, corn, beans and adds to breeding (cattle, the ovine race, etc.). In the coastal region, rice, cocoa, coffee, bananas and other tropical fruits are cultivated for export.

While in Ecuador the economy is essentially based on agriculture (it still provides a living for 40% of the population), it retains an archaic structure, which profoundly damages the economic development of the country. Only 8% of the 30 millions cultivable hectares are effectively developed. Moreover, 240 landowners have 1,600,000 hectares, that is more land than 350,000 small farmers have.

CONCENTRATION OF WEALTH AND POVERTY

Here we are coming onto what contributes to make poverty last: the concentration of wealth into the hands of a minority of monopolistic firms, accumulating their activities in every economic sectors (agricultural, industrial, service and banking). The great gap, which distinguishes between those two types of income, capital and work, dramatically increases.
? of the total income of the country belongs to only a few families; the poorest 20% own 2.5% of the national income, and earn 23 times less than the richest 10%. On the contrary, the richest 20% own 58.7% of the national income (Source : Informe de desarollo Humano, Ecuador 1999, PNUD, P.208).

The economic crisis context adds further to this situation: 44% of the working population are unemployed or underemployed(Source : Informe de desarollo Humano, Ecuador 1999, PNUD, P.208), the inflation (which reached its highest level at the end of 1999 and caused the replacement of the sugar by the US dollar in January 2001) results in a declined purchasing power, because the increase of prices is not passed on the wages. Thus, in June 2002, the basic power of bought is about 399$, whereas the average wage of a family is 221$. Therefore, the wage only covers 66% of the basic needs of a family.

WAY OF LIFE

Consequences in terms of the deterioration of the way of life make themselves cruelly felt. Thus, poverty significantly increases: between 1995 and 2000, the number of the poor doubled and the number of the indigent tripled; they are 8,600,000, that is 70% of the population of the country.

A DEFINITION OF POVERTY

Note that what we mean by poverty is a family deprived of their basic needs: health, nutrition, and education. By the indigent, we mean extreme poverty, that is a family, which cannot appease their minimum nutritional needs.

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