Ecuador Economic Forecast

Ecuador Economic Outlook

September 10, 2019

Growth is expected to have deteriorated in the second quarter, as IMF-mandated fiscal consolidation measures and falling real wage growth weigh on economic activity. That said, activity picked up throughout Q2 and export growth bounced back in the quarter on a surge in oil sales at the beginning of the period, reflecting higher oil prices. Furthermore, the belt-tightening reforms have led to an improved fiscal position, with the budget surplus widening in April–May, while international reserves trended up strongly in the first two quarters and remained solid at the outset of Q3 despite sliding in July. In the political arena, on 8 August, the National Court of Justice ordered the preventive detention of former-President Rafael Correa and four close party aides over briberies linked to the awarding of public-sector contracts and illicit funding of the Alianza País party.

Ecuador Economic Growth

Growth is seen flat this year as fiscal adjustment measures weigh on activity. A slowdown in credit expansion and weak business sentiment are expected to weigh on fixed investment, while reduced real wage growth will limit private consumption gains. That said, the fiscal position is projected to improve, while reserves will gradually strengthen amid reduced borrowing costs. FocusEconomics panelists project the economy to expand 0.0% in 2019, which is down 0.2 percentage points from last month’s forecast, and to grow 0.5% in 2020.

Ecuador Economy Data

20132014201520162017
Population (million)15.816.016.316.516.8
GDP per capita (USD)6,0306,3476,0996,0466,217
GDP (USD bn)95.110299.399.9104
Economic Growth (GDP, annual variation in %)5.03.80.1-1.22.4
Consumption (annual variation in %)5.13.50.3-2.03.6
Investment (annual variation in %)10.42.3-6.2-8.95.3
Industrial Production (annual variation in %)-  -  -  -  -  
Unemployment Rate4.04.34.35.4-  
Fiscal Balance (% of GDP)-4.6-5.2-6.0-7.3-4.5
Public Debt (% of GDP)24.029.633.038.244.6
Inflation Rate (CPI, annual variation in %, eop)2.73.73.41.1-0.2
Inflation Rate (CPI, annual variation in %)2.73.64.01.70.4
Inflation (PPI, annual variation in %)-  -  -  -  -  
Benchmark Interest Rate (%)4.535.185.145.124.95
Current Account (% of GDP)-1.0-0.7-2.21.3-0.5
Current Account Balance (USD bn)-0.9-0.7-2.21.3-0.5
Trade Balance (USD billion)-2.3-2.0-3.20.5-0.9
Exports (USD billion)24.825.718.316.819.1
Imports (USD billion)27.027.721.516.320.0
Exports (annual variation in %)4.23.9-28.7-8.313.8
Imports (annual variation in %)0.08.8-22.4-24.222.6
International Reserves (USD)4.44.02.54.32.5
External Debt (% of GDP)19.623.627.934.338.3

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Ecuador Facts

ValueChangeDate
Exchange Rate25,0000.0 %Sep 04
Stock Market1,3290.17 %Sep 04

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