In August 1984 Leon Febres-Cordero, [Partido Social Cristiano, a Social Christian] assumed the Presidency. During his presidency, Febres-Cordero introduced some free-market policies. The collapse of world oil prices in 1986 reduced Ecuador's oil export revenues by half, and an earthquake in March 1987 destroyed a large stretch of Ecuador's sole oil pipeline.

In 1988 Rodrigo Borja, [Izquierda Democratica, socialist] was elected President and his party held control of Congress. The period from 1988 to 1992 was characterized by increasing oil export prices and reductions in Government spending in real terms. Throughout this period, the Government pursued a gradual stabilization policy. Despite the Government's policies, inflation rose sharply, averaging 59.7% annually, notwithstanding intervals of relatively robust economic growth. There were cyclical shortages of energy as the site of the main hydroelectric plant had seasonal droughts.

President Sixto Duran Ballen, a former Social-Christian and founder of a new party formed prior to elections [Unidad Republicana], was inaugurated in 1992. During the Duran Ballen administration, modernization initiatives were introduced and stabilizing macroeconomic policies were implemented. In January 1995 the Cenepa incident [military confrontation with Peru] affected the performance of the economy. So did the political crisis [resignation of the Vice-President] and energy crisis [recurrence of seasonal shortages]. The Duran Ballen Administration began the negotiations toward a final settlement of the territorial dispute.

In 1996 Abdala Bucaram [Partido Roldosista Ecuatoriano, populist party] was inaugurated. Its Government announced a "Convertibility plan" with orthodox measures to curb inflation and correct macroeconomic imbalances. His unorthodox style gained him much publicity, but was also a cause for embarrassment and alienation for many sectors.

Allegations of widespread corruption, conflict with Congress and other institutions and the adoption of unpopular measures brought erosion of his support.

A general strike turned to a national protest on Feb. 5-6, 1997, which won the support of organized labour, business, professional organizations, representatives of the civil society, NGO's, and the great majority of Ecuadorian people. The virtual unanimity of the Ecuadorian people demanded the ousting of his Government.

Congress acted accordingly and appointed Fabian Alarcon [until then, President of the unicameral Congress –equivalent to Speaker of the House] as interim President of Ecuador. The people of Ecuador confirmed these drastic measures in a national referendum held in May, 1997. It also called for a National Assembly to reform the Constitution and political structure.

The National Assembly, chaired by former President Osvaldo Hurtado, advanced on the reforms to the Constitution [President Osvaldo Hurtado resigned and Luis Mejia chaired the Assembly for the last days]. The new Constitution entered into force in August 1998.

President Alarcon and Minister of Foreign Affairs Jose Ayala Lasso continued the negotiations for a final settlement of the territorial dispute with Peru, making significant progress.

In the 1998 election, Jamil Mahuad defeated contender Alvaro Noboa and was elected President of Ecuador.   President Jamil Mahuad signed in October 1998 the Peace Accords with Peru, ending one of the most intractable disputes in the western hemisphere.

The economic situation deteriorated rapidly and Ecuador plunged into its worst economic crisis in record [oil prices dropped, an international financial crisis caused capital flight, recession due to El Nino brought the economy to a halt and private banks collapsed].  In 1999, the economy shrank by 7.3% and the national currency, Sucre, plummeted.

For the first time in history an extended banking holiday was decreed and deposits frozen to prevent a run on banks, yet over 60% of banking assets ended in the hands of the State.  Ecuador was forced to default on its payments to private international creditors and was unable to reach an Agreement with the IMF.

On January 9, 2000, President Mahuad announced a decision to dollarize the economy and replace the national currency, Sucres, with US dollars at a 25,000 sucres per USD rate.

On January 21, 2000,  confusing street protests led by leaders of Indigenous organizations and Union leaders, with the support of junior Officers, forced the ousting of President Jamil Mahuad.  On January 21, 2000,    Vice-President Gustavo Noboa was sworn in as new President of Ecuador.

The Noboa Administration stayed the course on dollarization and swiftly pushed through Congress major legislation to implement it.  In April, 2000, an Agreement was reached with the IMF that secured US$ 2 billion in loans from international financial institutions to Ecuador.

In August of 2000, private creditors overwhelmingly accepted a bond-exchange offer and Ecuador became current on its obligations.

In February, 2001, Ecuador signed a contract with an international consortium [OXY and  Kerr-McGee of the U.S., AEC of Canada, ENI-AGIP of Italy, Repsol-YPF of Spain-Argentina and Techint of Italy-Argentina] to build a heavy crude oil pipeline.  The consortium will invest in excess of US$ 1.1 billion to build the OCP in a 2 year-period, and additional investments would produce a total of US$ 2 billion [about 13% of projected GDP].

Today the current head-of-state is newly-elected President Lucio Gutierrez. Gutierrez's rise to power began on January 21, 2000 when he was