Public policies after the 1987 and 2016 earthquakes in Ecuador: a social and risk management perspective.

Abstract

This work conducted a historical review of the main facts that characterized the earthquake of March 5, 1987, to conduct a comparative analysis of the public policies adopted after the earthquake of April 16, 2016. In the earthquake of 1987, among the main economic effects, was the rupture of around 70 km of the trans-Ecuadorian pipeline. The economic losses of this earthquake were USD 1,000 million. Among the social effects was the death of 1,000 people and damage to 6,000 homes. After the earthquake, the main measures adopted were the suspension of the payment of the external debt, the increase in the price of fuel, restrictions on public spending and the freezing of about twenty products of the basic basket. The earthquake of April 16, 2016, was most affected in the provinces of Manabí and Esmeraldas. The cost of economic losses from this earthquake was $3 billion. The Government addressed this situation with the approval of the Organic Law of Solidarity and Citizen Co-responsibility for the Reconstruction and Reactivation of the Affected Areas, which established solidarity contributions on remuneration, on assets, on profits and on real estate and capital representative rights existing in Ecuador owned by companies resident in tax havens or other foreign jurisdictions.  In addition, the VAT increase was set from 12% to 14%, for one year.