	Introduction

Ecuador is a small nation situated along the Pacific coast of South America (see Figure 1 ). Located between Colombia and Peru, two major cocaine-producing countries in the Andean region, Ecuador is strategically important to the United States. Belt-tightening measures taken by the government in response to a significant decline in oil revenues had exacerbated political tensions, and President Correa struggled with low approval ratings in 2016, when Venezuela and Bolivian leftist populist leaders in South America and President Daniel Ortega in Nicaragua also faced greater internal and external criticism. Former Vice President Lenín Moreno won a narrow victory in April 2017 presidential elections on the Alianza País (AP) party ticket. Correa—who returned from Europe, where he was living for a period with his Belgian wife, to fight the referendum advocated by President Moreno—managed to convince about a third of AP members of congress to join him in forming a new party. The Correa government effectively used petroleum exports to invest in infrastructure and economic development. President Correa's Citizens' Revolution, as he called his ideology, incorporated themes of economic justice and Andean pride with a critique of the traditional partisanship of Ecuadorian politics. In mid-November 2015, President Correa made a surprising announcement that he and others who had already served two terms would not be eligible to benefit from the constitutional change to allow for indefinite reelection and compete in the 2017 elections. 2017 Elections and the Moreno Government

The 2017 elections were the first in a decade in which Rafael Correa did not run for president, but his two former vice presidents both ran. Lenín Moreno served as vice president under Correa from 2007 to 2013, and Jorge Glas was Correa's most recent vice president until he left office to become Moreno's vice-presidential running mate. Jorge Glas ran on the same ticket as Moreno's vice president, but Glas turned out to be an unpopular running mate. On April 2, 2017, Moreno narrowly won in the runoff for the presidency with a margin of slightly more than 2% of the vote, according to Ecuador's National Election. Those divisions sharpened after Vice President Glas was impeached in January 2018 following his conviction for taking a $13.5 million bribe from the Brazilian construction company Odebrecht and his sentence to six years in prison in late 2017. In 2000, Ecuador adopted the U.S. dollar as its national currency following a major recession in 1999. However, in the middle of 2014 after the price of oil declined significantly, Ecuador's oil earnings fell. However, as of July 2016, only one-fifth of this amount had been received from donor countries, including the United States. According to press reports, some private sector analysts question whether Ecuador will be able to meet its debt obligations given two strains on the country's public finances: the slump in oil income due to the commodity's low price and the strong U.S. dollar, which, as a result of Ecuador's dollarized economy, makes the country's exports less globally competitive. U.S. Relations

Through the two terms of former president Correa, Ecuador's relations with the U.S. government were frequently tense. In 2014, the Correa government imposed restrictions on the work of the U.S. Agency for International Development (USAID), which resulted in the agency closing its offices in Ecuador after 60 years of operating in the country. In December 2017, however, the GSP was not renewed. Outlook

Ecuador is a more divided and polarized nation than in the years when Correa won elections by a landslide. How the historically close ties between Ecuador and the United States may fare under President Moreno's leadership remains to be seen, following his successful consolidation of power and declaration of independence from his one-time mentor and predecessor with a victory in the February 2018 public referendum.
Ecuador is a small, oil-producing country of 16 million inhabitants located on the west coast of South America between Colombia and Peru. In 2017, Ecuador was considered to have the third-largest proven reserves of crude oil in South America, with 8.3 billion barrels. It is the smallest member of the Organization of the Petroleum Exporting Countries (OPEC). Petroleum is Ecuador's largest export to the United States, the country's top trade partner. With the reduction in crude oil price since 2014, Ecuador's earnings have fallen after years of strong growth.
Former President Rafael Correa (2007-2017), a leftist populist leader, was elected and reelected over a decade, bringing stability to Ecuador. In 2015, his popularity began to decline; he dropped in the polls to a 35% approval level by the middle of 2016. A recession brought on by low oil prices had diminished government revenues, and President Correa had adopted many unpopular budget-tightening measures. Protests from diverse groups—indigenous people, trade unionists, environmentalists, and critics from the right and center-right—became more frequent. Correa's critics accused him of constraining freedom of assembly and association, stifling freedom of the press and expression, and restricting independence of the judiciary.
On April 2, 2017, presidential candidate Lenín Voltaire Moreno of the Alianza País (AP) party narrowly won a runoff election in Ecuador, with a margin of slightly more than 2% of the vote. The 2017 election was the first in a decade in which Rafael Correa did not run for president. His two former vice presidents both ran on the same ticket: Moreno, who served six years as Correa's vice president, was at the top of the ticket, and Jorge Glas, Correa's most recent vice president, left the Correa Administration in 2016 to become Moreno's vice presidential running mate. Once in office, Vice President Glas remained close to Correa, whereas President Morena moved quickly to adopt a more moderate and conciliatory position and shifted away from Correa's abrasive style. In October 2017, President Moreno suspended Glas from the vice presidency due to accusations of "illicit association" with the Brazilian construction company Odebrecht. In December 2017, Glas was convicted and sentenced to six years in prison for taking more than $13 million in bribes from Odebrecht executives. Out of office for 90 days, Glas was impeached in January 2018 and replaced by acting Vice President Maria Alejandro Vicuña, who is close to Moreno.
Correa's party, the AP, had retained a majority in the February 2017 legislative elections but split as Moreno was accused of being a traitor and of undermining Correa's reform approach, which he called the "Citizens' Revolution." Many observers thought that Correa planned to return in 2021 to be easily reelected. Correa had pushed through legislation in the National Assembly allowing for indefinite reelection, and many assumed he would avail himself of this option after his former vice presidents served a term as caretakers. However, President Moreno set a public referendum for February 4, 2018, to limit the presidency to two terms, among other measures. The referendum was approved by a large margin, thus consolidating Moreno's control and making Correa's return to power unlikely.
Under Correa, relations between Ecuador and the United States were strained, but the two countries maintained close economic ties. Following a period of currency turmoil, Ecuador adopted the U.S. dollar as its currency in 2000. Ecuador receives significant remittances from Ecuadorans living in the United States and abroad. Ecuador also has become a popular destination for U.S. tourists and retirees.
This report examines the political and economic conditions in Ecuador and U.S.-Ecuadorian relations.