Ecuador’s FTA with Canada, finalized by President Noboa, raises concerns over environmental impacts and conflicts of interest due to family ties to mining firms. The agreement may empower corporations to challenge local legislation through ISDS, threatening democracy and public welfare, despite significant public opposition in both countries. Critics warn that it could prioritize corporate interests over those of local communities, risking Ecuador’s sovereignty.
In September 2023, Ecuadorian President Daniel Noboa announced the completion of a free trade agreement (FTA) with Canada after extensive negotiations. While the government promotes this agreement as a pathway to economic development, many civil society organizations in both nations are concerned. They warn that the FTA could significantly benefit extractive industries like mining, resulting in increased environmental damage, human rights violations, and conflicts with Ecuador’s constitutional protections.
President Noboa’s family has a notable financial interest in the negotiation outcomes, particularly through their involvement with Adventus Mining Corporation, a Canada-based entity. The Noboa family, one of Ecuador’s wealthiest, has substantial stakes in the firm, leading to accusations that the agreement prioritizes their private gain over national interest and regulatory integrity, especially since it includes investor protections that conflict with Ecuador’s constitutional prohibitions.
The Noboa family’s connection to the Canadian mining sector deepened when Nobis, founded by President Noboa’s aunt, acquired nearly 10 percent of Adventus Mining Corporation in 2019. This strategic investment positioned them as the largest Ecuadorian investors in Adventus, which holds significant stakes in major mining projects including El Domo. Following this, high-ranking executives from Nobis filled key roles within Adventus, influencing mining policy and securing favorable contracts.
President Noboa’s administration continued pushing for mining advancements without transparency regarding familial interests. In January 2024, Noboa granted an environmental permit for the Domo project despite strong local opposition. He later rescinded an executive ethics code limiting nepotism and represented Ecuador at a significant mining conference in Toronto, promoting mining deals and advancing talks for the Canada-Ecuador FTA.
As local communities protested the approval of El Domo’s environmental license, six human rights defenders faced imprisonment, raising concerns over governmental repression of dissent. Meanwhile, Adventus sought acquisition by Canadian firm Silvercorp, increasing the Noboa family’s financial stake amid escalating local resistance.
Critics argue that the FTA serves a dual purpose of advancing mining interests while threatening Ecuador’s sovereignty. Provisions may allow foreign corporations to challenge new regulations through investor-state dispute settlement (ISDS) mechanisms, undermining the government’s capacity to legislate in the public interest. Past experiences with ISDS have created skepticism among Ecuadorians, who have seen significant financial losses from adverse rulings favoring corporations.
Historically, the misuse of ISDS provisions has burdened Ecuador with costly payouts, evident in the case of Copper Mesa. Despite this, recent administrations, including Noboa’s, have taken steps to reintegrate Ecuador into the ISDS framework, which poses risks of repeated corporate exploitation at the expense of public welfare.
Given Canada’s status as a major player in Latin America’s mining industry, the agreement may enable corporations to circumvent stringent legislation by leveraging favorable treaty options. With significant public opposition to the FTA in both countries, Noboa must consider the long-term implications of prioritizing corporate interests over environmental and social protections, potentially jeopardizing Ecuador’s sovereignty and Canada’s international reputation.
The Ecuador-Canada Free Trade Agreement poses potential threats to environmental integrity and national sovereignty, driven by conflicts of interest linked to President Noboa’s family. The agreement includes provisions that could benefit private mining interests at the expense of public welfare and democratic governance. Civil society groups express concerns that the deal may pave the way for corporate exploitation and undermine local communities, emphasizing the need for vigilant public scrutiny before ratification. Ultimately, the FTA risks compromising Ecuador’s autonomy while enhancing Canada’s controversial investment landscape.
Original Source: cepr.net
