Ecuador Economic Forecast

Ecuador Economic Outlook

January 15, 2019

The economy entered the final quarter on a promising note, with economic activity growing at an accelerated pace from the third quarter’s mild upturn in growth. Overall activity sped up in October, buttressed by a tepid increase in oil exports despite a contraction in petroleum production in the January–October period as the country’s state-owned oil company Petroamazonas EP continued to cut output. However, while still strong, the trend of the past three quarters suggests that the inflow of remittances continued to weaken into the fourth quarter. Coupled with milder credit growth, this likely curbed private consumption growth. On the fiscal front, before the close of the year, the government announced cuts to gasoline subsides and public sector salaries, aimed at reducing the fiscal gap by USD 700 million. Moreover, a USD 900 million loan secured from China in December should aid the Andean nation in financing its 2019 budget, with the IMF also possibly lending financial support.

Ecuador Economic Growth

Growth is expected to deteriorate again in 2019, with the Met the why particular panel projecting an expansion of 0.9% in 2019, which is down 0.1 percentage points from last month’s forecast. Government expenditure cuts, aimed at strengthening the fiscal account, will likely weigh on overall economic activity. Moreover, private consumption growth is expected to weaken on tighter credit availability and higher inflationary pressures. Risks to the outlook continue to stem from less favorable global financial conditions, owing to the dollarized economy’s heavy reliance on external financing. The panel sees GDP growth edging up to 1.3% in 2020.

Ecuador Economy Data

20132014201520162017
Population (million)15.816.016.316.516.8
GDP per capita (USD)6,0306,3476,0995,9666,143
GDP (USD bn)95.111299.398.6113
Economic Growth (GDP, annual variation in %)5.03.80.1-1.63.0
Consumption (annual variation in %)5.13.50.3-3.34.7
Investment (annual variation in %)11.42.3-6.2-8.1-0.5
Industrial Production (annual variation in %)6.23.7-0.4-2.52.1
Unemployment Rate4.04.34.35.4-  
Fiscal Balance (% of GDP)-9.9-9.6-6.2-7.4-5.4
Public Debt (% of GDP)24.029.633.038.745.2
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 %)3.1-0.71.71.3-  
Benchmark Interest Rate (%)4.535.185.145.124.95
Current Account (% of GDP)-1.0-0.5-2.11.5-0.3
Current Account Balance (USD bn)-0.9-0.5-2.11.4-0.3
Trade Balance (USD billion)-0.9-2.0-3.20.5-0.9
Exports (USD billion)24.825.718.316.819.1
Imports (USD billion)25.827.721.516.320.0
Exports (annual variation in %)4.63.5-28.7-8.413.8
Imports (annual variation in %)6.57.6-22.4-24.122.6
International Reserves (USD)4.44.02.54.32.5
External Debt (% of GDP)19.623.627.634.138.2

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Ecuador Facts

ValueChangeDate
Exchange Rate25,0000.0 %Jan 21
Stock Market1,4190.17 %Jan 21

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