Ecuador

Ecuador straddles the equator—hence its name—and biological zones so distinct they function as separate countries: Amazonian rainforest to the east, Andean highlands bisecting the center, Pacific coast to the west, and the Galápagos Islands 1,000 kilometers offshore. This geographic compression makes Ecuador one of 17 megadiverse countries on Earth, hosting more species per square kilometer than almost anywhere else. It also gave Charles Darwin the observations that became evolutionary theory.

The Inca Empire conquered Ecuador's highland peoples—the Cañari, Quitu, and Caras—around 1470, incorporating them into a realm stretching from Colombia to Chile. Huayna Capac made his secondary capital at Tomebamba (modern Cuenca) and his son Atahualpa was born there. But the empire held Ecuador for barely 40 years before Spanish conquest. When Francisco Pizarro arrived in 1532, his 168 men and 27 horses exploited an Inca civil war to capture Atahualpa at Cajamarca. By 1534, Sebastián de Belalcázar had founded Quito atop Inca ruins.

Spanish colonial rule devastated the indigenous population—an estimated 90% died from smallpox, measles, and forced labor in mines and haciendas. Ecuador became part of the Viceroyalty of Peru, then joined Nueva Granada in 1720. The independence struggle began in Guayaquil on October 9, 1820; Simón Bolívar's armies, led by Antonio José de Sucre, won the decisive Battle of Pichincha on May 24, 1822. Ecuador briefly joined Gran Colombia before separating as an independent republic in 1830. Two years later, the government annexed the Galápagos Islands—then pirate nests, now UNESCO's first Natural Heritage Site.

The 20th century brought oil dependency and political instability. Amazon petroleum extraction began in the 1970s, transforming state revenues but creating environmental devastation in the Oriente. Ecuador cycled through coups, constitutions, and crises until the 1999 banking collapse triggered hyperinflation and ended the sucre. In 2000, the government adopted the US dollar—importing American monetary stability at the cost of monetary sovereignty. Ecuador cannot print money, adjust exchange rates, or deploy conventional monetary policy during crises. The trade-off persists: inflation stays low (2.2% projected for 2025), but international reserves of $8.1 billion cover only 3.3 months of imports.

The security transformation has been catastrophic. Once one of South America's safest countries, Ecuador has in under a decade become its most violent. Dollarization, busy seaports, and weak border controls made the country a transit hub for cocaine flowing to Europe. Murder rates soared; cities like Guayaquil and Durán became gang battlegrounds. Over 20,000 extortion complaints have been filed since 2024, with only 34 convictions. President Daniel Noboa declared an "internal armed conflict" in January 2024, deploying military forces against gangs, but violence has resurged after initial declines.

Today's economy reflects geographic diversity and extractive dependency. Oil comprises 30% of exports; the Amazon's ITT field shutdown and weak global prices constrain revenues. Bananas (world's largest exporter at $3.4 billion), shrimp, and cocoa anchor agricultural exports. The Galápagos generate ecotourism premiums. But US tariffs of 15% now hit major exports (with oil exemptions), and growth of 2.1% trails Latin America's 2.5% average. A $1.5 billion Chinese-Canadian oil concession was cancelled after protests; energy shortages constrain production.

Through 2026, Noboa's strategy emphasizes fiscal discipline, IMF engagement, extractive development, and US alignment. His re-election brought political stability, but gang violence, energy shortages, and commodity dependency limit options. Like the finches Darwin studied—evolving in isolation toward specialized niches—Ecuador must adapt to shifting conditions. Whether it diversifies before oil reserves decline determines whether the megadiverse nation avoids the resource curse that has trapped so many petroleum exporters.