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Sixteen years ago the worst financial crisis in the history of the country took place

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Sixteen years ago the worst financial crisis in the history of the country took place

Sixteen years ago the worst financial crisis in the history of the country took place
April 10
14:54 2015

Quito (Pichincha).- The so-called “bank holiday” occurred on March 8, 1999, one of the worst financial crisis in the country, featuring political and banking powers. Deposits were frozen giving way to dollarization.

Bankers, whose political decision powers were decisive even years before, were not only part of government cabinets but in the case of former President Jamil Mahuad, banking financed his campaign.

 

On Monday, March 8, 1999, a bank freeze of 24 hours, was announced by Superintendent of Banks, Jorge Egas Peña, this freeze was extended to five days. This step was taken to avoid massive withdrawals of savings, like those occurred in Filanbanco.

 

While President Mahuad appeared on radio and television to announce that deposits of more than 2 million sucres would be frozen for a year to avoid hyperinflation. The collapse of the financial system was a palpable and ominous fact, with terrible consequences that would exceed decades.

 

In addition to this provision, in late 1998, the National Congress, formed by mostly Partido Social Cristiano and Democracia Popular political party led the way for institutions (such as the Agency for Deposit Insurance (AGD) for its acronym in Spanish, for the state take charge of private banking.

 

.Protests followed for days and the rest of the year, while Mahuad and popularity had fallen. Costs of services and good sky rocketed and a large number of Ecuadorians decided to immigrate, a clear sign of the crisis.

In 2000 the Ecuadorian government began exchanging sucres for dollars at the rate of S/. 25,000 = $1. From this point on, the Ecuadorian government would only mint coins in equal value to the American penny, nickel, dime, quarter and half-dollar. By the end of the year, the sucre had disappeared completely from circulation.

Economic losses from bank freeze amounted to eight billion dollars, while the country was witnessing the visible consequences of the relationship between corrupt banking and political power, just 16 years ago. Never Forget (Prohibido Olvidar) never capital above human beings

The documentary “Crisis Memorial, Feriado Bancario”, will be aired as follows: Canal Uno at 11:00; Teleamazonas at 13:15; RTS at 14:00; TC at 15:00; Ecuavisa at 19:30; El Ciudadanao Tv at 20:30; Gama 21:15 Quito, 22:15 Guayaquil and Ecuador Tv a las 22:30. /SD El Ciudadano

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