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 Correa, a U.S.-trained economist, has often been at odds with
Washington since winning power in 2007. He accuses the U.S.
government of trying to undermine him and this year Ecuador
renounced U.S. trade benefits dating from the early 1990s.
According to a U.S. State Department spokesperson, Ecuador recently
informed the U.S. Agency for International Development (USAID) it
could not undertake new activities or extend existing ones without
an accord governing bilateral assistance. This led to the U.S.
decision to cancel the aid.
"Our planned $32 million in assistance programs for the coming years
would have allowed us to partner with Ecuadoreans to achieve their
own development goals in critical areas," said a letter dated
December 12 from USAID to Ecuador seen by Reuters.
Ecuadorean government officials had no immediate comment.
The USAID letter said that in 60 years of working together, more
than $800 million in development aid had helped hundreds of
thousands of Ecuadoreans.
A spokesperson for the U.S. Embassy in Quito said two years of
negotiations failed to reach a new agreement.
"USAID had begun incurring significant costs for four recently
launched projects (focused on environmental protection and civil
society strengthening) which have been unable to proceed," the
embassy spokesperson said.
"Their cancellation was the only fiscally prudent option."
Correa, a vocal member of a bloc of left-wing Latin American
leaders, won re-election in a landslide early this year after
generous state spending on infrastructure and health services. He
has irked investors with his anti-capitalist rhetoric, and this year
he passed a controversial law creating a state media watchdog that
critics denounced as a blow to free speech. Correa says it enshrines
principles of balance.
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In 2011, Ecuador expelled the U.S. ambassador to Quito after
American diplomatic cables published by WikiLeaks alleged that
Correa's government had turned a blind eye to police corruption.
Last year, he threatened to expel USAID from the country, alleging
that it was funding local groups that he said sought to undermine
the region's "progressive" governments.
In May, Bolivia's socialist President Evo Morales expelled USAID in
protest after U.S. Secretary of State John Kerry referred to Latin
America as Washington's "backyard."
Ties between Washington and Ecuador were strained again this year
after Correa said he would consider offering asylum to the fugitive
former U.S. intelligence contractor Edward Snowden.
Last year, Correa granted asylum to WikiLeaks' founder Julian
Assange, saying they were both victims of persecution. Assange is
holed up in Ecuador's embassy in London.
(Additional reporting by Ezra Fieser in Santo Domingo and David
Adams in Miami; writing by Daniel Wallis; editing by Kieran Murray
and Christopher Wilson)
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