Leaving Oil in the Soil: Transnational Class Power, Capitalism and Neo-extractivism in Ecuador

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In 2009, a ground-breaking environmental initiative was presented to the international community by the Ecuadorian government under president Rafael Correa. The proposal entailed leaving the biodiverse Yasuní natural park -which contained 20% of Ecuador’s oil reserves- untouched in return for international donations to compensate for expected oil profits. In 2013, drilling for oil in Yasuní commenced, despite widespread domestic popular and political support for preservation of the park. While a lack of donors partly accounts for this outcome, this thesis fills the gap in the literature by accounting for a structural-historical explanation for Ecuador’s continuing reliance on oil and extractivism. Following a Critical Realist ontology supplemented by a Neo-Gramscian theoretical framework, the thesis employs an explaining-outcome process-tracing analysis in order to answer the research question “why did the Yasuní initiative fail?” The outcomes of the process-tracing analysis suggest that the shift toward the export of primary goods in Ecuador’s economy following the 2000’s commodity boom and the ensuing increased government dependence on oil rents for the financing of its social welfare programmes are at the core of the Yasuní initiative’s failure. Despite the Correa administration´s efforts to diminish the direct political power of the corporate cadre, the structural power of the transnational capitalist class in Ecuador was maintained to such an extent that dominant economic interests prevented the success of the Yasuní initiative. Through this combination of structural and agential causal factors, Ecuador continues down its neo-extractivist path.
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