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It’s true, it’s ridiculous, and hopefully it won’t happen, but Ecuador plans to raise the tax on money sent outside the country from 2% to 5%.It will only raise prices as importers will be forced to cover their costs somehow. It’s all part of the antiquated, outdated, protectionist and erroneous strategy of import substitution the country has been practicing for the last few years. Supposedly this is going to protect local producers of goods to enhance and improve the business environment for local industry-by, no less, making imported goods more costly and thus less attractive. Yet Ecuador produces very little of high quality in the first place. And if the country wants to move towards a strategy of increasing industrial production of quality goods-well, it needs to import equipment from abroad to make those goods in the first place! The only thing we’re going to end up with here are more mediocre locally produced goods, and high-priced, low quality goods from China! And if you listen to the rhetoric in the clip here, it sounds like they’re also terrified of a liquidity crisis in the country as too many dollars are moving out, too few moving in, and they have no tools for monetary policy to control the outflow other than the proposed measure.

There is an article published about it here¬†in Spanish and I’m including a version of it below, with my edits, in English.

QUITO . The Departure Tax on Foreign Exchange (ISD) will rise from 2% to 5%, as presented by the new tax reform will be sent to the Assembly as a matter of urgency by the Executive.

This was confirmed by the director of the Internal Revenue Service (IRS), Carlos Marx Carrasco, in Guayaquil during a seminar organized by the Ecuadorian American Chamber of Commerce and the Human Factor.

According to a report by the Bureau of Analysis, the new reform, which would be the eleventh in this government, provides for three fundamental changes: increase of 2% to 5% tax on foreign exchange outflow, extending from 3 to 6 year period expiration of the given capacity of SRI, and a tax exemption for sporting weapons.

About the ISD, the proposal remains is to tax the export amounts to remain abroad and added an increase of three points.

According to Carrasco, on this issue there are a number of important exemptions which deal with the allocation of tax credits, which will not affect production. But imports of consumer goods and luxuries, he said.

Employers yesterday rejected the measure. Bernardo Acosta, vice president of the Chamber of Industry of Pichincha, called it wrong and harmful to the productive apparatus.

He explained that it is worrying that the government insist on a measure that does not meet the purpose for which it was created, ie, keeping capital in the country.¬†Rather, it discourages investments, it is not attractive for foreign investment in Ecuador if you then will have to pay taxes when you take them out.¬†“The measure not only is a loser for business, but for consumers,” he said.

Joaquin Carvajal, president of the Ecuadorian American Chamber of Commerce of Guayaquil, deemed the measure excessive. There should be a tiered tax, depending on how much capital you are sending out of the country.

The ISD has increased from 0.5% to 1% and then to 2% during this administration.

Making chocolates every day does¬īt mean just making chocolates. Making chocolate in Quito, Ecuador is even more challenging than making chocolates in North America or Europe. Unlike in the United States, there are not a lot of third parties to whom you can outsource tasks and many chocolate making ingredients usually purchased pre-made are not available here. So my responsibilities are even greater than they might be in the US. Running a chocolate business includes a plethora of skills-especially if it’s a small operation like we are. My job description includes management, purchasing, packaging, production, marketing, advertising, social media marketing, mathematics, prioritizing, delegating, and critical thinking among other things.

Overall management includes a great number of tasks. On a daily basis I have to make sure we have adequate materials in stock, including perishables such as milk, cream and butter. So managing our ingredients means not only identifying suppliers, but buying the right amount from each one at the right time so as not to disturb our cash flow and make sure that funds going out are less than and not equal to or greater than what we have coming in over any given period. With perishables, it’s more complicated because we have to be sure we have enough in stock to cover any upcoming planned demand and enough to cover extra demand that’s unexpected, but not so much that it might go to waste. Managing production means I have to make sure there’s enough chocolate on the shelf at any given time to fulfill an order within two or three days and be able to fulfill random walk-in customers, but not so much that it’s aging on the shelf and spoiling. Management also means delegating lower-level, easy tasks to my employee, freeing up my time for more important and complicated ones like social marketing.

We’ve also done export, and still do occasionally. Exporting chocolate from Ecuador of course had an initial learning curve which wasn’t too bad but a little overwhelming initially, but once we had done it once or twice it was easy. However, initially we had to have packaging designd, quoted, then printed. This included getting nutrition info and nutrition labels printed meeting FDA specs. We had to calculate to make sure that our packaging would fit neatly into the cardboard carton boxes we also had to have ordered, and that those boxes would again fit neatly into the shipping boxes. We had to learn about commercial invoices, bills of lading, volumetric measurements for shipping, and customs.

I use math on a daily basis. Scaling recipes is the most common use, but I also try to keep some basic metrics on output per hour when using the enrober-and these can vary depending on the number of people helping me. Since we frequently develop new recipes or make new items, I regularly cost out recipes/formulas, looking at the cost of ingredient, how much goes into each piece, and the final cost per piece, whether it’s chocolate, cookies, cakes, pastry or what have you. It’s all a numbers game.

I have to prioritize perpetually. And I have to prioritize for my employee. Make sure that she starts what takes longest first, so that she can busy herself with other smaller, less important, less time-consuming tasks while the longer tasks are in progress. I do the same for myself. Get the caramel cooking, while that’s going, make the brownies and get them in the oven. Once they are in the oven, keep stirring the caramels, while I measure out the ingredients for a batch of ganache. All the while checking the equipment to see when the chocolate will be in temper. So that as soon as the ganache is done I can dip the centers while the caramel cools. So that once I’m done dipping the centers, the caramel is ready to cut. By that time the brownies are done and cooling. Now we can dip the caramel centers. You get the idea. There are a lot of balls to juggle in any kitchen and the only way to make the best use of your time is to know how to prioritize.

Being at least mildly mechanically handy helps when working with machines. Not all chocolate shops are going to have a chocolate enrober or other mechanical equipment-but if you do, it helps to have some mechanical ability. You have to put things together, take them apart, some more, some less, depending on your equipment. You might have to fiddle with some nuts, bolts and wires on an enrober or a guitar cutter, to replace a broken string.

I also have to produce a number of ingredients not available here, mainly fondant, gianduja, and nut praline. And before I forget, I also make the chocolates and write this blog!

Swiss Chard is commonly found here in Ecuador’s highlands-almost as common as cacao in the lowlands. But you don’t find it in a lot of dishes. It’s usually served here in soup “Sopa de Acelga,” with pieces of chard floating in the broth. Not my favorite way to eat it, and I didn’t have a whole lot of options to prepare it-usually sauteed with some anchovies and garlic, maybe some julienned strips of red pepper tossed in, cooked until tender. Or cooked down into a sort of ragu, then served over pasta with breadcrumbs and parmesan on top.

It was at my in-laws house that the maid was preparing it in a totally new way. An unusual way. She called the “Emborrajados.” The closes thing I can find for this word is some kind of fritter. And that’s exactly what it is. It’s a very basic recipe, but one of the most delicious ways I have found to prepare chard.

First, quickly blanch it in salted water for 3-4 mins (at sea level, probably less-use your culinary judgement) until it’s soft but not falling apart. You’re going to be frying it in a later step so it will continue to cook there.

Make a quick fritter batter with about two eggs, a cup of flour, and salt and pepper. A dash of nutmeg doesn’t hurt. Chop the chard into 1/2″ strips or so, pretty finely chopped. Make sure it’s dry and mix it in with the batter. It should look like this:

Chard Fritters001.jpg

Then, with two soup spoons, make a quenelle like shape, and don’t worry if it doesn’t hold tightly together. The batter should be wet but not so stiff that you can’t get it to mix in with the chard. But is should be dry enough that you can basically form a loosely packed quenelle that will hold together when you drop it in the hot oil.

Fry it up and eat with a squeeze of lemon before serving!

Chard Fritters002.jpg

70G Bar Kallari 75% Chocolate $2.21

50G Bar Caoni Chocolate $1.28

280G Can Pomodoro Italian Tomatoes $1.16

Whole Pineapple ($3.08/kg) about $1.2o per pineapple

White Onions $0.80/lb

Eggplants $0.63/lb

Apples Imported from Chile $0.86/lb

Bag of 25 Frozen Mini Empanadas $3.66

Bag of Lettuce $0.99

Prices from Supermaxi Tumbaco, Ecuador on 20 September 2001

Whether you’re coming for a short visit to see the Galapagos, spend a few days in old Quito, or learn about chocolate making with us, a number of new possibilities for rentals have opened up. I’ll mention right away AirBnB.com, which has dozens of listing for Quito alone, as well as other cities throughout Ecuador. We have also listed an available apartment next door to the chocolate shophttp://www.cuencacondos.com/blog/2011/07/cuenca-organic-chocolate/#more-393

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Welcome to Destination Ecuador!

Welcome to Destination Ecuador! My family and I have been living in Ecuador for the last four and a half years. We’ve dealt with the worst kinds of red-tape, searched out or ended up making hard-to-find ingredients ourselves, imported equipment for making chocolate confections, learned the import-export business...Continue >>

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