Ecuador Economic Forecast

Ecuador Economic Outlook

February 18, 2020

Available data suggests that the economy remained subdued in the final quarter of 2019, after it shrank for the first time in three years in the third quarter on falling domestic demand. Economic activity contracted, on average, at a faster clip in October–November compared to Q3, while credit growth eased in Q4, hinting that household spending and fixed investment likely faltered. In other news, on 6 February Moody’s downgraded the country’s credit rating from B3 to Caa1. Political and social resistance has slowed the government’s implementation of IMF-backed fiscal policy reforms, constraining investor demand for public debt ahead of the government’s heavy repayment schedule starting in 2022. However, the agency changed the outlook from negative to stable as risks to debt repayments are expected to remain contained before 2022.

Ecuador Economic Growth

Growth is expected to rebound mildly this year as fixed investment recovers on the back of improving business conditions. However, political uncertainty ahead of next year’s elections and the risk of protests and strikes as the government attempts to reduce its wage bill are key threats to the outlook. FocusEconomics panelists project the economy growing 0.3% in 2020, which is unchanged from last month’s forecast, and see growth accelerating to 0.9% in 2021.

Ecuador Economy Data

2014 2015 2016 2017 2018
Population (million)16.016.316.516.817.0
GDP per capita (USD)6,3476,0996,0466,2176,319
GDP (USD bn)10299.399.9104108
Economic Growth (GDP, annual variation in %)3.80.1-1.22.41.3
Consumption (annual variation in %)3.50.3-2.03.62.4
Investment (annual variation in %)2.3-6.2-8.95.32.0
Industrial Production (annual variation in %)-  -  -  -  -  
Unemployment Rate4.34.35.44.44.1
Fiscal Balance (% of GDP)-5.2-6.0-7.3-4.5-1.2
Public Debt (% of GDP)29.633.038.244.646.0
Inflation Rate (CPI, annual variation in %, eop)3.73.41.1-0.20.3
Inflation Rate (CPI, annual variation in %)3.64.01.70.4-0.2
Inflation (PPI, annual variation in %)-  -  -  -  -  
Benchmark Interest Rate (%)5.185.145.124.955.62
Current Account (% of GDP)-0.7-2.21.3-0.5-1.4
Current Account Balance (USD bn)-0.7-2.21.3-0.5-1.5
Trade Balance (USD billion)-2.0-3.20.5-0.9-1.6
Exports (USD billion)25.718.316.819.121.6
Imports (USD billion)27.721.516.320.023.2
Exports (annual variation in %)3.9-28.7-8.413.813.0
Imports (annual variation in %)8.8-22.4-24.122.615.9
International Reserves (USD)4.02.54.32.52.7
External Debt (% of GDP)23.627.634.238.540.9

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Ecuador Facts

Value Change Date
Exchange Rate25,0000.0 %Dec 31

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