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Ecuador is a South American country bordered by Colombia and Peru (with which it has fought periodic wars over territorial disputes for much of its history), and straddling the equator from which it takes its name. A democratic republic, it has suffered from economic volatility and extremely high rates of crime, especially since the financial crisis of 1999.

Despite its proximity to the cocaine capitals of Colombia and Peru, Ecuador is not a major producer or trafficker of narcotics. It is more proper to consider it a victim of the drug trade, with Colombian conflicts continually spilling over into the northern border region. However, in the late 1980s and early 1990s in particular, as Colombia and Peru strengthened their efforts against cocaine cartels, traffickers rerouted through Ecuador's seaports and Pan-American Highway. Moreover, Ecuador's banking laws are friendly to money laundering, especially compared to those of its neighbors. Because of the increased efforts against the cartels in Colombia and Peru and the lenient money-laundering laws, Ecuador's involvement in the drug trade increased for a time. During the late 1980s and early 1990s, seizures of cocaine originating in Ecuador skyrocketed, while imports of chemicals associated with cocaine processing also increased. However, as early as 1990, new banking regulations were instituted that made money laundering and cartel financing more difficult.

This camouflaged 100-foot submarine built by drug traffickers was discovered near Ecuador's Colombian border in July 2010.

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It was not long ago that Ecuadorian officials declared that the country was virtually without a drug abuse problem. Ecuador's approach to the drug wars of the Americas was one of national security—protecting the borderlands from Colombia, preventing the violent crimes associated with the drug trade. It had few real successes with this approach, and domestic drug use gradually inched up. Cocaine and marijuana were easy to come by, and not very expensive even for the country's impoverished. Still, rates of illegal drug use are relatively low in Ecuador, with approximately 2 percent of the adult population using marijuana and slightly more than 1 percent using cocaine. Treatment programs are rare, as are drug education programs. But this is changing. A shift from treating drugs as a law enforcement issue to treating them as a public health concern is reflected in Ecuador's new constitution, adopted in late 2008, which in Article 364 contains this key text:

Addictions are a public health problem. It is the State's responsibility to develop coordinated information, prevention and control programs for alcohol, tobacco, and psychotropic and narcotic substances; as well as offer treatment and rehabilitation for occasional, habitual, and problematic users. Under no circumstance shall they be criminalized nor their constitutional rights violated.

The expectation is that explicit drug law reform, decriminalizing at least the use and possession of drugs, will follow sometime in 2010. In the meantime, President Rafael Correa employed a stopgap measure, pardoning over 2,000 people convicted of minor drug offenses since the law currently is not compatible with the constitution. This act brought international controversy upon Ecuador because some of those pardoned were drug mules, smuggling small amounts of drugs on behalf of traffickers, which even many drug law reformers consider a distinctly different class of crime from possession of small amounts for personal use. But as in many poorer countries, the mules are seen as guilty principally of opportunism—faced with few job options, they took a risky job with high rewards.

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