Mounting political challenges.
Amid internal criticism over budget cuts and street protests over reductions in education spending, President Lenin Moreno on November 22 asked his whole cabinet to resign. The decision illustrates the difficulties facing Moreno in managing his government and party and in maintaining support, as he tries to pull his administration towards the political centre. Anti-corruption efforts have further complicated this task, with investigations opening political wounds and implicating members of the government, including Vice-President Maria Alejandra Vicuna.
Dialogue with social and political actors may help ease resistance to budget cuts in the short term, but fiscal pressures will persist.
Protests will increase as cuts start to bite and Correa supporters and other sociopolitical actors mobilise their bases.
Lower oil prices would constrain the government, threatening its austerity programme and raising the need for external borrowing in 2019.
