Ecuador Economic Forecast

Ecuador Economic Outlook

October 11, 2021

The economy returned to growth in Q2, driven by sharp rebounds in consumption and investment. However, the external sector detracted from growth as imports recovered, and the headline GDP reading was flattered by a low base effect. Turning to Q3, growth was likely brisk, aided by a surge in the vaccination rate. Economic activity grew healthily in July, while consumer confidence improved through August and the unemployment rate averaged lower in July–August relative to Q2, boding well for private spending. In politics, in late September President Lasso announced a reform package which aims to raise taxes on the wealthy and make the labor market more flexible. However, the president’s weak parliamentary support could stymie the approval of the measures. Also in September, the IMF announced the disbursement of USD 800 million upon a successful review of its Extended Fund Facility program.

Ecuador Economic Growth

This year, the economy should bounce back, in line with firming domestic and foreign demand and higher average prices for oil. Growth should stay solid next year, aided by a continued recovery in the labor market. That said, the spread of more infectious variants of Covid-19 and the president’s lack of a parliamentary majority to push through key reforms pose risks. FocusEconomics panelists project GDP to expand 3.4% in 2021. In 2022, the panel sees GDP growth moderating to 3.1%, which is unchanged from last month’s forecast.

Ecuador Economy Data

2015 2016 2017 2018 2019
Population (million)16.316.516.817.017.3
GDP per capita (USD)6,0996,0466,2176,3196,222
GDP (USD bn)99.399.9104108107
Economic Growth (GDP, annual variation in %)0.1-1.22.41.30.1
Consumption (annual variation in %)0.3-2.03.62.40.7
Investment (annual variation in %)-6.2-8.95.32.0-3.4
Industrial Production (annual variation in %)-  -  -  -  -  
Unemployment Rate4.35.44.44.1-  
Fiscal Balance (% of GDP)-6.1-8.2-4.5-3.1-2.8
Public Debt (% of GDP)33.038.244.646.050.2
Inflation Rate (CPI, annual variation in %, eop)3.41.1-0.20.3-0.1
Inflation Rate (CPI, annual variation in %)4.01.70.4-0.20.3
Inflation (PPI, annual variation in %)-  -  -  -  -  
Benchmark Interest Rate (%)5.145.124.955.626.22
Current Account (% of GDP)-2.21.1-0.1-1.2-0.1
Current Account Balance (USD bn)-2.21.1-0.2-1.3-0.1
Trade Balance (USD billion)-3.20.5-0.9-1.5-0.2
Exports (USD billion)18.316.819.121.622.3
Imports (USD billion)21.516.320.023.222.6
Exports (annual variation in %)-28.7-8.413.813.13.2
Imports (annual variation in %)-22.4-24.122.615.8-2.6
International Reserves (USD)2.54.32.52.73.4
External Debt (% of GDP)27.634.238.540.948.7

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Ecuador Facts

Value Change Date
Exchange Rate25,0000.0 %Dec 31

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