March 16, 2017 | Policy Brief

Ecuador, Iran, and Latin America’s Pink Tide

March 16, 2017 | Policy Brief

Ecuador, Iran, and Latin America’s Pink Tide

Ecuador will elect a new leader on April 2 to replace its left-wing, populist president Rafael Correa. Washington should pay close attention. Correa’s vice-president Lenin Moreno is a close second in the polls, but should he win, he will likely continue Correa’s economic populism and anti-Americanism, including, crucially, pursuing a strong relationship with Iran.

Correa came to power at the onset of Latin America’s “pink tide” – the rise of charismatic, left-wing leaders like Venezuela’s Hugo Chavez and Bolivia’s Evo Morales. Since then, their growing authoritarianism and failed economic policies have eroded their support, opening the way to more moderate, pro-Western leaders like Mauricio Macri in Argentina and Pedro Pablo Kuczynski in Peru.

A Moreno victory, however, could mark the return of the pink tide. Correa has handpicked Moreno to run for the presidency, much as Chavez had tapped Nicolas Maduro to succeed him upon his death. Although Correa has not yet run his country aground as did Venezuela’s leaders, under his stewardship, Ecuador has become a “major drug transit country” with significant “vulnerability for money laundering,” according to the State Department.

Similarly, Ecuador, an OPEC member, has seen its GDP contract amid lower oil prices, albeit not as dramatically as in Venezuela. Additionally, Quito’s membership in the Venezuelan-led regional trade bloc ALBA pushes it further from the U.S. and towards the same Bolivarian socialism that has led to the near demise of Venezuela.

These parallels should not be lost on U.S. policymakers. Quito has long claimed to be an ideological ally of Caracas, and has been its staunch diplomatic partner regionally and internationally. Thus, as Venezuela continues to crumble under international economic sanctions, Iran might shift its center of gravity in Latin America to Ecuador.

In 2010 and 2011, Correa and Moreno travelled to Tehran to sign bilateral agreements, including building a power plant in Ecuador, providing industrial and technical knowledge, and banking partnerships. As vice president, Moreno also oversaw a $30-million deal to conduct joint mining projects as a basis for future extractive activities.

Although many of these projects never came to fruition, the budding relationship was troubling enough for the Financial Action Trask Force (FATF) to identify Ecuador as insufficiently committed to combating money laundering and terror finance. And although FATF removed Ecuador from the money laundering blacklist in 2015, the U.S. continues to monitor the risk the country poses to the region through financial and drug-related crimes.

Ties between Iran and its anti-American counterparts in Latin America have generally been based less on economics than shared opposition to U.S. influence. Twice in 2016, Iranian Foreign Minister Javad Zarif travelled to Latin America – including Ecuador – to reaffirm cooperation with left-wing governments there.

Such ties have given Iran an open door to spread its ideology across the region. In Ecuador, for example, Iranian influence extends to a growing number of missionaries and Islamic cultural centers that promote the Islamic Republic’s mix of Shiite extremism and anti-Western dogma.

U.S. decision-makers should be concerned over the prospect of a Moreno victory moving Quito further towards a Chavez-style anti-American foreign policy. Ecuador is a small, often-overlooked country, but it could prove crucial to Iran’s goals of reviving the region’s pink tide.

Michaela Frai is a research associate at the Foundation for Defense of Democracies, where she focuses on Latin America. Follow her on Twitter @MichaelaFrai.