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Your are here: Country Profile > Ecuador

Key Facts

GDP (ppp) per CAPITA
$4,500 (2006 est.)
Inflation Rate
3.4% (2006 est.)
Population
13,755,680 (July 2007 est.)
Country Risk Ratings
C
Ease of Doing Business
128/178
Global Competitiveness
103/131
 
Embassies of Ecuador
Embassies in Ecuador
Ecuador Business Holidays
 
 
 
 
 
 
 
 

Ecuador

Ecuador Flag Ecuador Map Between 1904 and 1942, Ecuador lost territories in a series of conflicts with its neighbors. A border war with Peru that flared in 1995 was resolved in 1999. Although Ecuador marked 25 years of civilian governance in 2004, the period has been marred by political instability. Protests in Quito have contributed to the mid-term ouster of Ecuador's last three democratically elected Presidents. After winning the 2006 presidential elections, President Rafael CORREA assumed power in 2007. Besides being very critical of Congress, he won public support to have the constitution redrafted so the power of the political parties can be limited, and he is opposed to a free trade agreement with the U.S.

Capital City: Quito (-5 GMT) 
Chief of State: President Rafael CORREA Delgado 
Head of Govt.: President Rafael CORREA Delgado 
Currency: US dollar 
Main Cities: Guayaquil 
Major Languages: Spanish 
Calling Code: 593 
Voltage: 110/220V 
Primary Religions: Roman Catholic

Main Airports

Guayaquil (GYE) (Simón Bolívar), Quito (UIO) (Mariscal Sucre)

U.S. Embassy

Avenida Patria 120 Quito, Ecuador
tel. (593)(2) 256-2890/256-1634)

Statistics

GDP: purchasing power parity:
$56.9 billion (2005 est.)
GDP - real growth rate:
3.9% (2005 est.)
GDP - per capita: purchasing power parity:
4,300 (2005 est.)
Inflation rate (consumer prices):
2.1% (2005 est.)
Labor force:
4.6 million (urban) (2005 est.)
Exports:
$9.224 billion (2005 est.)
Exports - partners:
US 52.7%, Peru 8.3%, Germany 4.5% (2005)
Imports:
$8.436 billion (2005 est.)
Imports - partners:
US 22.4%, Colombia 13%, Venezuela 7.9%, Brazil 6%, China 5.3% (2005)
Population:
13,547,510 (July 2006 est.)
Population growth rate:
1.5% (2006 est.)
Population Below Poverty Line:
41% (2006)
Major Industries:
petroleum, food processing, textiles, wood products, chemicals
Employing Workers: 161*
Registering Property: 84*
Enforcing Contracts: 96*
Closing a Business: 134*
*2006 World Bank rank out of 175 countries
Starting a Business

The table below shows the number of steps and the amount of time needed to start a business, on average

Indicator Ecuador Region
Procedures (number) 14 10.2
Time (days) 65 73.3

Ecuador Risk Assessment

Country Rating

Rating: C

A very uncertain political and economic outlook and a business environment with many troublesome weaknesses can have a significant impact on corporate payment behaviour. Corporate default probability is high.

Risk Assessment

The anti-liberal leftwing president Rafael Correa began his four-year term in January 2007. The election victory of his Acuerdo Pais movement late September 2007 led to the institution of a constituent Assembly with early general elections likely in 2008.

Despite public spending buoyed by higher oil revenues, economic growth should be limited due to a smaller rise in private consumption attributable to a decline in expatriate transfers and bank credit, along with a reduction in corporate investment amid the current political and economic uncertainties.

The profit sharing with international oil companies was revised again in favour of the State in October 2007 and the country rejoined OPEC end 2007. The oil wealth should contribute to an increase in social spending but without jeopardising the fiscal surplus for the time being. There is nonetheless still uncertainty as to Ecuador's intention to fully honour its obligations in connection with foreign debt, even if officials seem aware of the negative impact of any unjustified restructuring. The suspension of negotiations on a free trade agreement with the United States, the country's main trading partner, will affect its exports and its trade and current account surpluses should shrink. And unless the Andean Trade Promotion and Drug-Eradication Act (ATPDEA) is extended beyond March 2008, Ecuador will lose its preferential access to the North American market.


In this troubled context, the macroeconomic improvement achieved in recent years could be in jeopardy from 2009. In a period of international financial turmoil, that prospect could trigger a crisis of confidence in financial markets.

STRENGTHS

  • Ecuador boasts extensive resources — mining, gas, and especially oil — with completion of the trans-Andean pipeline supposed to facilitate increased production and exports.
  • World-leading exporter of bananas and shrimp, the country is also endowed with rich fishing areas especially for tuna.
  • The economy's dollarisation has notably contributed to limiting inflation and capital flight.
  • Rising wages and easier access to credit have spurred household consumption.

WEAKNESSES

 
  • Insufficiently diversified, the economy has been vulnerable to fluctuations in raw materials prices, particularly for oil.
  • Chronic political instability has not facilitated economic and financial consolidation and has hampered progress on reforms.
  • A lack of infrastructure and skilled labour compounded by a poor institutional and legal environment has deterred local and foreign investors.
  • Ecuador suffers from a chronic shortage of foreign exchange reserves, a shortcoming nonetheless mitigated by the dollarisation.
  • Regional disparities, marked inequality and social tensions have undermined the cohesiveness of this multiethnic country.

 

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