Keep Us Strong WikiLeaks logo

Currently released so far... 97115 / 251,287

Articles

Browse latest releases

Browse by creation date

Browse by origin

A B C D F G H I J K L M N O P Q R S T U V W Y Z

Browse by tag

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
ETRD EAGR ETTC EAID ECON EFIN ECIN EINV ELAB EAIR ENRG EPET EWWT ECPS EIND EMIN ELTN EC ETMIN EUC EZ ET ELECTIONS ENVR EU EUN EG EINT ER ECONOMICS ES EMS ENIV EEB EN ECE ECOSOC EK ENVIRONMENT EFIS EI EWT ENGRD ECPSN EXIM EIAD ERIN ECPC EDEV ENGY ECTRD EPA ESTH ECCT EINVECON ENGR ERTD EUR EAP EWWC ELTD EL EXIMOPIC EXTERNAL ETRDEC ESCAP ECO EGAD ELNT ECONOMIC ENV ETRN EIAR EUMEM ENRGPARMOTRASENVKGHGPGOVECONTSPLEAID EREL ECOM ECONETRDEAGRJA ETCC ETRG ECONOMY EMED ETR ENERG EITC EFINOECD EURM EENG ERA EXPORT ENRD ECONEINVETRDEFINELABETRDKTDBPGOVOPIC EGEN EBRD EVIN ETRAD ECOWAS EFTA ECONETRDBESPAR EGOVSY EPIN EID ECONENRG EDRC ESENV ETT EB ENER ELTNSNAR ECHEVARRIA ETRC EPIT EDUC ESA EFI ENRGY ESCI EE EAIDXMXAXBXFFR EETC ECIP EIAID EIVN EBEXP ESTN EING EGOV ETRA EPETEIND ELAN ETRDGK EAIDRW ETRDEINVECINPGOVCS EPEC ENVI ELN EAG EPCS EPRT EPTED ETRB EUM EAIDS EFIC EFINECONEAIDUNGAGM EAIDAR ESF EIDN ELAM EDU EV EAIDAF ECN EDA EXBS EINTECPS ENRGTRGYETRDBEXPBTIOSZ EPREL EAC EINVEFIN ETA EAGER EINDIR ECA ECLAC ELAP EITI EUCOM ECONEFINETRDPGOVEAGRPTERKTFNKCRMEAID EARG ELDIN EINVKSCA ENNP EFINECONCS EFINTS ECCP ETC EAIRASECCASCID EINN ETRP EAIDNI EFQ ECOQKPKO EGPHUM EBUD ECONEINVEFINPGOVIZ ENERGY ELB EINDETRD EMI ECONEFIN EIB EURN ETRDEINVTINTCS EIN EFIM ETIO ELAINE EMN EATO EWTR EIPR EINVETC ETTD ETDR EIQ ECONCS EPPD ENRGIZ EISL ESPINOSA ELEC EAIG ESLCO EUREM ENTG ERD EINVECONSENVCSJA EEPET EUNCH ECINECONCS ETRO ETRDECONWTOCS ECUN EFND EPECO EAIRECONRP ERGR ETRDPGOV ECPN ENRGMO EPWR EET EAIS EAGRE EDUARDO EAGRRP EAIDPHUMPRELUG EICN ECONQH EVN EGHG ELBR EINF EAIDHO EENV ETEX ERNG ED
KMDR KPAO KPKO KJUS KCRM KGHG KFRD KWMN KDEM KTFN KHIV KGIC KIDE KSCA KNNP KHUM KIPR KSUM KISL KIRF KCOR KRCM KPAL KWBG KN KS KOMC KSEP KFLU KPWR KTIA KSEO KMPI KHLS KICC KSTH KMCA KVPR KPRM KE KU KZ KFLO KSAF KTIP KTEX KBCT KOCI KOLY KOR KAWC KACT KUNR KTDB KSTC KLIG KSKN KNN KCFE KCIP KGHA KHDP KPOW KUNC KDRL KV KPREL KCRS KPOL KRVC KRIM KGIT KWIR KT KIRC KOMO KRFD KUWAIT KG KFIN KSCI KTFIN KFTN KGOV KPRV KSAC KGIV KCRIM KPIR KSOC KBIO KW KGLB KMWN KPO KFSC KSEAO KSTCPL KSI KPRP KREC KFPC KUNH KCSA KMRS KNDP KR KICCPUR KPPAO KCSY KTBT KCIS KNEP KFRDCVISCMGTCASCKOCIASECPHUMSMIGEG KNNB KGCC KINR KPOP KMFO KENV KNAR KVIR KDRG KDMR KFCE KNAO KDEN KGCN KICA KIMMITT KMCC KLFU KMSG KSEC KUM KCUL KMNP KSMT KCOM KOMCSG KSPR KPMI KRAD KIND KCRP KAUST KWAWC KTER KCHG KRDP KPAS KITA KTSC KPAOPREL KWGB KIRP KJUST KMIG KLAB KTFR KSEI KSTT KAPO KSTS KLSO KWNN KPOA KHSA KNPP KPAONZ KBTS KWWW KY KJRE KPAOKMDRKE KCRCM KSCS KWMNCI KESO KWUN KPLS KIIP KEDEM KPAOY KRIF KGICKS KREF KTRD KFRDSOCIRO KTAO KJU KWMNPHUMPRELKPAOZW KEN KO KNEI KEMR KKIV KEAI KWAC KRCIM KWCI KFIU KWIC KCORR KOMS KNNO KPAI KBWG KTTB KTBD KTIALG KILS KFEM KTDM KESS KNUC KPA KOMCCO KCEM KRCS KWBGSY KNPPIS KNNPMNUC KWN KERG KLTN KALM KCCP KSUMPHUM KREL KGH KLIP KTLA KAWK KWMM KVRP KVRC KAID KSLG KDEMK KX KIF KNPR KCFC KFTFN KTFM KPDD KCERS KMOC KDEMAF KMEPI KEMS KDRM KEPREL KBTR KEDU KNP KIRL KNNR KMPT KISLPINR KTPN KA KJUSTH KPIN KDEV KTDD KAKA KFRP KWNM KTSD KINL KJUSKUNR KWWMN KECF KWBC KPRO KVBL KOM KFRDKIRFCVISCMGTKOCIASECPHUMSMIGEG KEDM KFLD KLPM KRGY KNNF KICR KIFR KM KWMNCS KAWS KLAP KPAK KDDG KCGC KID KNSD KMPF KPFO KDP KCMR KRMS KNPT KNNNP KTIAPARM KDTB KNUP KPGOV KNAP KNNC KUK KSRE KREISLER KIVP KQ KTIAEUN KPALAOIS KRM KISLAO KWM KFLOA
PHUM PINR PTER PGOV PREL PREF PL PM PHSA PE PARM PINS PK PUNE PO PALESTINIAN PU PBTS PROP PTBS POL POLI PA PGOVZI POLMIL POLITICAL PARTIES POLM PD POLITICS POLICY PAS PMIL PINT PNAT PV PKO PPOL PERSONS PING PBIO PH PETR PARMS PRES PCON PETERS PRELBR PT PLAB PP PAK PDEM PKPA PSOCI PF PLO PTERM PJUS PSOE PELOSI PROPERTY PGOVPREL PARP PRL PNIR PHUMKPAL PG PREZ PGIC PBOV PAO PKK PROV PHSAK PHUMPREL PROTECTION PGOVBL PSI PRELPK PGOVENRG PUM PRELKPKO PATTY PSOC PRIVATIZATION PRELSP PGOVEAIDUKNOSWGMHUCANLLHFRSPITNZ PMIG PREC PAIGH PROG PSHA PARK PETER POG PHUS PPREL PS PTERPREL PRELPGOV POV PKPO PGOVECON POUS PGOVPRELPHUMPREFSMIGELABEAIDKCRMKWMN PWBG PMAR PREM PAR PNR PRELPGOVEAIDECONEINVBEXPSCULOIIPBTIO PARMIR PGOVGM PHUH PARTM PN PRE PTE PY POLUN PPEL PDOV PGOVSOCI PIRF PGOVPM PBST PRELEVU PGOR PBTSRU PRM PRELKPAOIZ PGVO PERL PGOC PAGR PMIN PHUMR PVIP PPD PGV PRAM PINL PKPAL PTERE PGOF PINO PHAS PODC PRHUM PHUMA PREO PPA PEPFAR PGO PRGOV PAC PRESL PORG PKFK PEPR PRELP PREFA PNG PGOVPHUMKPAO PRELECON PINOCHET PFOR PGOVLO PHUMBA PRELC PREK PHUME PHJM POLINT PGOVPZ PGOVKCRM PGOVE PHALANAGE PARTY PECON PEACE PROCESS PLN PRELSW PAHO PEDRO PRELA PASS PPAO PGPV PNUM PCUL PGGV PSA PGOVSMIGKCRMKWMNPHUMCVISKFRDCA PGIV PRFE POGOV PEL PBT PAMQ PINF PSEPC POSTS PHUMPGOV PVOV PHSAPREL PROLIFERATION PENA PRELTBIOBA PIN PRELL PGOVPTER PHAM PHYTRP PTEL PTERPGOV PHARM PROTESTS PRELAF PKBL PRELKPAO PKNP PARMP PHUML PFOV PERM PUOS PRELGOV PHUMPTER PARAGRAPH PERURENA PBTSEWWT PCI PETROL PINSO PINSCE PQL PEREZ PBS

Browse by classification

Community resources

courage is contagious

Viewing cable 08QUITO267, Natural Disasters Increase Short-Term Inflation

If you are new to these pages, please read an introduction on the structure of a cable as well as how to discuss them with others. See also the FAQs

Understanding cables
Every cable message consists of three parts:
  • The top box shows each cables unique reference number, when and by whom it originally was sent, and what its initial classification was.
  • The middle box contains the header information that is associated with the cable. It includes information about the receiver(s) as well as a general subject.
  • The bottom box presents the body of the cable. The opening can contain a more specific subject, references to other cables (browse by origin to find them) or additional comment. This is followed by the main contents of the cable: a summary, a collection of specific topics and a comment section.
To understand the justification used for the classification of each cable, please use this WikiSource article as reference.

Discussing cables
If you find meaningful or important information in a cable, please link directly to its unique reference number. Linking to a specific paragraph in the body of a cable is also possible by copying the appropriate link (to be found at theparagraph symbol). Please mark messages for social networking services like Twitter with the hash tags #cablegate and a hash containing the reference ID e.g. #08QUITO267.
Reference ID Created Released Classification Origin
08QUITO267 2008-03-18 13:21 2011-05-02 00:00 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Quito
VZCZCXYZ0020
PP RUEHWEB

DE RUEHQT #0267/01 0781321
ZNR UUUUU ZZH
P 181321Z MAR 08
FM AMEMBASSY QUITO
TO RUEHC/SECSTATE WASHDC PRIORITY 8636
INFO RUEHBO/AMEMBASSY BOGOTA 7446
RUEHCV/AMEMBASSY CARACAS 2953
RUEHLP/AMEMBASSY LA PAZ MAR LIMA 2489
RUEHGL/AMCONSUL GUAYAQUIL 3412
UNCLAS QUITO 000267 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: ECON EFIN ETRD EC
SUBJECT:  Natural Disasters Increase Short-Term Inflation 
 
REF: A) QUITO 225, B) Quito 55 C) 07 Quito 2659, D) Quito 36, E) 07 
Quito 2114, F) 07 Quito 2095 
 
1.  Summary.  Ecuador's inflation rose in the first two months of 
2008 due in large part natural disasters, namely severe flooding and 
a volcanic eruption.  Additionally, rising global inflationary 
pressure, particularly for food, contributed to Ecuador's 
inflationary up-tick.  However, Ecuador's medium- to long-term 
inflation outlook appears stable, although salary increases and 
rising government expenditure could generate inflationary pressure. 
End Summary. 
 
Short Term Inflation Rise Due to Local Disasters 
--------------------------------------------- --- 
 
2. (U) Inflation rose significantly in the first two months of 2008 
compared to 2007.  Inflation rose 1.14 percent in January 2008, the 
highest monthly increase in five years. Inflation rose 0.94 percent 
in February 2008 compared to 0.07 percent in February 2007. 
Annualized inflation through January 2008 was 4.19 percent, compared 
to 2.68 percent in the same period a year earlier. 
 
3. (U) The eruptions of Tungurahua volcano in late January and early 
February affected agricultural production and distribution in the 
volcano's vicinity.  Potato production was most significantly 
affected, with prices rising 3.8 percent in February 2008. 
 
4. (U) Mass flooding throughout Ecuador in February harmed 
agricultural production, especially in coastal regions, and closed 
many transportation routes, thus hindering distribution (reftel a). 
This led to increased consumer prices nationwide.  The largest 
inflationary spikes were seen in food products and non-alcoholic 
drinks.  Prices in this group rose 0.52 percent in February 2008. 
Products with the highest increase were: tomatoes, 13.9 percent; 
fresh fish, 7.25 percent; and soft drinks, 3.8 percent. 
 
5.  (U) In addition to the weather and the volcanic eruption, two 
policy factors also contributed to inflation.  The minimum wage was 
increased by 15% in late 2007 and was effective at the beginning of 
2008.  In addition, the government implemented extensive tax reforms 
at the beginning of the year (reftels b and c), including raising 
excise taxes on ostensibly luxury goods (including cigarettes, 
make-up and cars), which led to price increases for those goods. 
 
Rising Global Inflationary Pressure 
----------------------------------- 
 
6. (U) Increasing global prices for commodities coupled with 
Ecuador's reliance on imported inputs have contributed to 
inflationary pressure on both consumer and producer prices since the 
middle of 2007.  The biggest increases in February in this category 
were whole chickens, 6.6 percent; and vegetable oil, 5.4 percent; 
chicken prices are heavily influenced by the cost of imported feeds 
and other inputs, while vegetable oil is imported.  Producer prices 
rose 1.89 percent in February 2008, raising the annual producer 
prices inflation rate to 9.36 percent.  With producer prices rising 
faster than consumer prices, this trend could put additional 
pressure on consumer prices. 
 
7.  (U) Rising petroleum prices have only a secondary impact on 
inflation in Ecuador, for example in the cost of plastic packaging 
material or international shipping costs.  However, the domestic 
prices of fuel products (gasoline, diesel, LPG) have been frozen for 
several years.  This policy, which predates the Correa 
administration, has become increasingly expensive for the 
government, which imports petroleum derivatives and subsidizes the 
difference. 
 
Long Term Inflation Outlook Appears Stable 
------------------------------------------ 
 
7.  (U) At 3.3 percent, Ecuador's 2007 year-end inflation was the 
lowest in Latin America.  In spite of the unexpected short term up 
tick from natural disasters, Ecuadorian inflation in the beginning 
of 2008 remained on par relative to its regional neighbors.  In 
February 2008, Ecuador's inflation rate of 0.94 percent was lower 
than Colombia (1.51 percent) and equal to Peru (0.91 percent). 
 
8. (U) The Central Bank of Ecuador predicts inflation to rise 
between 2.9 and 3.7% in 2008.  Five-year predictions from the 
Economist Intelligence Unit predict Ecuadorian annual inflation 
rates between 3.4 and 4.5 percent through 2012. 
 
Comment 
------- 
 
11. (SBU) Since adopting the U.S. dollar in late 2000, inflation has 
been a bright spot in the Ecuadorian economy. Inflation rates have 
remained low both by regional and global standards.  Although 
Ecuador had the lowest inflation rate in 2007 in Latin America and 
the medium- to long-term inflation outlook appears stable, risks 
remain.  One is that short-term inflationary pressures remain from 
both the flooding and global price increases.  It remains to be seen 
whether the government will try to contain this inflationary 
pressure through market intervention, as it has already done for 
milk (price controls), flour (subsidies), and rice (export ban) 
(reftels d-f). 
 
12.  (SBU) In the medium-term, continued government spending and 
promises of more wage hikes in upcoming years could generate 
additional inflationary pressure, although those pressures appear to 
be contained for the time being because of Ecuador's sluggish 
economic growth.  Frozen fuel prices also represent suppressed 
inflation, which will be a problem when and if the government ever 
decides to adjust those prices. 
 
JEWELL