Mountains in Ecuador

Ecuador Private consumption

Ecuador Private consumption

Private Consumption in Ecuador

The Ecuadorian economy recorded an average growth rate of 1.7% in private consumption in the decade to 2022, slightly below the 1.8% average for Latin America. In 2022, private consumption growth was 4.6%. For more private consumption information, visit our dedicated page.

Ecuador Private consumption Chart

Note: This chart displays Private Consumption (annual variation in %) for Ecuador from 2017 to 2023.
Source: Central Bank of Ecuador.

Ecuador Private consumption Data

2018 2019 2020 2021 2022
Private Consumption (ann. var. %) 2.1 2.1 -10.6 11.3 7.4

Economy records sharpest contraction since Q1 2021 in Q4

GDP dropped 0.7% year on year in the final quarter of 2023, contrasting the 0.7% expansion tallied in the third quarter. Q4's reading marked the worst result since Q1 2021. On a seasonally-adjusted quarter-on-quarter basis, GDP contracted 2.4% in Q4, following the previous period's 1.3% contraction. Q4's reading marked the largest decrease since Q2 2020. Elevated insecurity, lower oil output and tighter financial conditions likely weighed on activity in the fourth quarter.

Private consumption fell 0.5% in the fourth quarter, which was above the third quarter's 2.3% contraction. Public consumption growth was 1.0% (Q3: +3.9% yoy). Meanwhile, fixed investment contracted 5.2% in Q4. (Q3: -3.2% yoy). On the external front, exports of goods and services contracted 7.4% in Q4 (Q3: +1.7% yoy). Conversely, imports of goods and services rebounded, growing 16.2% in Q4 (Q3: -3.2% yoy).

While GDP could return to growth in quarter-on-quarter terms in Q1 following two large and successive quarterly declines, economic activity will remain muted due to elevated crime rates, which led to the declaration of a state of emergency in January. An increase in VAT from April will further suppress domestic demand in Q2.

On the outlook for this year as a whole, Oxford Economics’ Mauricio Monge said: “Ecuador's GDP growth is expected to slow to 1% in 2024-2025 […]. Domestic demand will remain weak, with private consumption and investment expected to grow marginally. Factors such as the VAT rate increase, prolonged high interest rates in the US, security issues, and electricity shortages will impact household spending and investment. Additionally, the oil ban in the Yasuní from Q4 2024 onward will affect the economy through 2025.”

Consensus Forecasts and Projections for the next ten years

How should you choose a forecaster if some are too optimistic while others are too pessimistic? FocusEconomics collects Ecuadorian private consumption projections for the next ten years from a panel of 10 analysts at the leading national, regional and global forecast institutions. These projections are then validated by our in-house team of economists and data analysts and averaged to provide one Consensus Forecast you can rely on for each indicator. By averaging all forecasts, upside and downside forecasting errors tend to cancel each other out, leading to the most reliable private consumption forecast available for Ecuadorian private consumption.

Download one of our sample reports to visualize what a Consensus Forecast is and see our Ecuadorian private consumption projections.

Want to get access to the full dataset of Ecuadorian private consumption forecasts? Send an email to info@focus-economics.com.

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