Ecuador Economic Forecast

Ecuador Economic Outlook

February 13, 2018

New data points to a slowdown in the final quarter of 2017. Economic activity contracted year-on-year for the third consecutive month in November, although the rate of decline eased slightly from October. Lower oil production in compliance with OPEC’s output cutback agreement was partly behind the deterioration: Oil output was 3.3% lower in the first eleven months of the year compared to the same period of 2016. Despite exports accelerating in November, imports again expanded at a faster rate, weighing on overall growth for the fourth month running. An upturn in oil production in December, however, likely yielded an improvement in the economic activity index. In the political sphere, a victory for President Lenín Moreno in the disputed nationwide referendum held on 4 February granted him a long-sought mandate to implement constitutional changes and advance an agenda that deviates from former president Rafael Correa’s position.

Ecuador Economic Growth

The economy is expected to grow at a subdued pace this year, with growth falling short of the 2017 rate. Reduced oil output, along with planned austerity measures aimed at reducing the debt burden, are likely to dent overall economic activity. Risks to the outlook stem from the nation’s high dependence on external borrowing, potentially jeopardizing long-term financial stability. FocusEconomics panelists project GDP growth slowing to 1.7% in 2018, which is up 0.1 percentage points from last month’s forecast, and 1.3% in 2019.

Ecuador Economy Data

20122013201420152016
Population (million)15.515.816.016.316.5
GDP per capita (USD)5,6656,0306,3826,1546,079
GDP (USD bn)87.995.1102100100
Economic Growth (GDP, annual variation in %)5.65.04.00.2-1.5
Consumption (annual variation in %)4.35.13.80.0-2.1
Investment (annual variation in %)10.610.43.8-5.9-8.0
Industrial Production (annual variation in %)3.46.22.9-0.8-0.5
Unemployment Rate4.14.04.34.35.4
Fiscal Balance (% of GDP)-0.9-4.6-5.3-5.2-  
Public Debt (% of GDP)21.224.029.532.737.9
Inflation Rate (CPI, annual variation in %, eop)4.22.73.73.41.1
Inflation Rate (CPI, annual variation in %)5.12.73.64.01.7
Inflation (PPI, annual variation in %)2.03.13.11.7-  
Benchmark Interest Rate (%)4.534.535.185.145.12
Current Account (% of GDP)-0.2-1.0-0.5-2.11.4
Current Account Balance (USD bn)-0.2-0.9-0.5-2.11.4
Trade Balance (USD billion)-1.7-0.6-2.0-3.20.5
Exports (USD billion)23.824.825.718.316.8
Imports (USD billion)25.525.527.721.516.3
Exports (annual variation in %)6.54.63.5-28.7-8.4
Imports (annual variation in %)4.30.08.8-22.4-24.1
International Reserves (USD)2.54.44.02.54.3
External Debt (% of GDP)18.219.823.827.133.8

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Ecuador Facts

ValueChangeDate
Exchange Rate25,0000.0 %Feb 22
Stock Market1,2500.17 %Feb 22

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