Social Class In Ecuador
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The economy of Ecuador is the eighth largest in
Latin America Latin America is the cultural region of the Americas where Romance languages are predominantly spoken, primarily Spanish language, Spanish and Portuguese language, Portuguese. Latin America is defined according to cultural identity, not geogr ...
and the 69th largest in the world by total GDP.
Ecuador Ecuador, officially the Republic of Ecuador, is a country in northwestern South America, bordered by Colombia on the north, Peru on the east and south, and the Pacific Ocean on the west. It also includes the Galápagos Province which contain ...
's economy is based on the export of oil,
bananas A banana is an elongated, edible fruit – berry (botany), botanically a berry – produced by several kinds of large treelike herbaceous flowering plants in the genus ''Musa (genus), Musa''. In some countries, cooking bananas are called pla ...
,
shrimp A shrimp (: shrimp (American English, US) or shrimps (British English, UK)) is a crustacean with an elongated body and a primarily Aquatic locomotion, swimming mode of locomotion – typically Decapods belonging to the Caridea or Dendrobranchi ...
,
gold Gold is a chemical element; it has chemical symbol Au (from Latin ) and atomic number 79. In its pure form, it is a brightness, bright, slightly orange-yellow, dense, soft, malleable, and ductile metal. Chemically, gold is a transition metal ...
, other primary agricultural products and money transfers from Ecuadorian emigrants employed abroad. In 2017,
remittance A remittance is a non-commercial transfer of money by a foreign worker, a member of a diaspora community, or a citizen with familial ties abroad, for household income in their home country or homeland. Money sent home by migrants competes ...
s constituted 2.7% of Ecuador's GDP. The total trade amounted to 42% of the Ecuador's GDP in 2017. The country is substantially dependent on its petroleum resources. In 2017, oil accounted for about one-third of public-sector revenue and 32% of export earnings. When Ecuador was part of
OPEC The Organization of the Petroleum Exporting Countries (OPEC ) is an organization enabling the co-operation of leading oil-producing and oil-dependent countries in order to collectively influence the global oil market and maximize Profit (eco ...
, it was one of the smallest members and produced about 531,300 barrels per day of
petroleum Petroleum, also known as crude oil or simply oil, is a naturally occurring, yellowish-black liquid chemical mixture found in geological formations, consisting mainly of hydrocarbons. The term ''petroleum'' refers both to naturally occurring un ...
in 2017. It is the world's largest exporter of bananas ($3.38 billion in 2017) and a major exporter of shrimp ($3.06 billion in 2017). Exports of non-traditional products such as
cut flowers Cut flowers are flowers and flower buds (often with some Plant stem, stem and leaf) that have been cut from the plant bearing it. It is removed from the plant for decorative use. Cut greens are leaves with or without stems added to the cut flow ...
($846 million in 2017) and canned fish ($1.18 billion in 2017) have grown in recent years. In the past, Ecuador's economy depended largely on primary industries like agriculture, petroleum, and aquaculture. As a result of shifts in global market trends and development of technology, the country has experienced economic development in other sectors, such as textiles, processed food, metallurgy and the service sectors. Between 2006 and 2014, GDP growth averaged 4.3%, driven by high oil prices and external financing. From 2015 until 2018, GDP growth averaged just 0.6%. Ecuador's ex-president, Lenín Moreno, launched a radical transformation of Ecuador's economy after taking office in May 2017. The aim was to increase the private sector's weight, in particular the oil industry.


Agriculture

Ecuador is one of the 10 largest producers in the world of
banana A banana is an elongated, edible fruit – botanically a berry – produced by several kinds of large treelike herbaceous flowering plants in the genus '' Musa''. In some countries, cooking bananas are called plantains, distinguishing the ...
, cocoa and
palm oil Palm oil is an edible vegetable oil derived from the mesocarp (reddish pulp) of the fruit of oil palms. The oil is used in food manufacturing, in beauty products, and as biofuel. Palm oil accounted for about 36% of global oils produced from o ...
. In 2018, the country produced 7.5 million tons of
sugarcane Sugarcane or sugar cane is a species of tall, Perennial plant, perennial grass (in the genus ''Saccharum'', tribe Andropogoneae) that is used for sugar Sugar industry, production. The plants are 2–6 m (6–20 ft) tall with stout, jointed, fib ...
, 6.5 million tons of
banana A banana is an elongated, edible fruit – botanically a berry – produced by several kinds of large treelike herbaceous flowering plants in the genus '' Musa''. In some countries, cooking bananas are called plantains, distinguishing the ...
(6th largest producer in the world), 2.7 million tons of
palm oil Palm oil is an edible vegetable oil derived from the mesocarp (reddish pulp) of the fruit of oil palms. The oil is used in food manufacturing, in beauty products, and as biofuel. Palm oil accounted for about 36% of global oils produced from o ...
(6th largest producer in the world), 1.3 million tons of
maize Maize (; ''Zea mays''), also known as corn in North American English, is a tall stout grass that produces cereal grain. It was domesticated by indigenous peoples in southern Mexico about 9,000 years ago from wild teosinte. Native American ...
, 1.3 million tons of
rice Rice is a cereal grain and in its Domestication, domesticated form is the staple food of over half of the world's population, particularly in Asia and Africa. Rice is the seed of the grass species ''Oryza sativa'' (Asian rice)—or, much l ...
, 269 thousand tons of
potato The potato () is a starchy tuberous vegetable native to the Americas that is consumed as a staple food in many parts of the world. Potatoes are underground stem tubers of the plant ''Solanum tuberosum'', a perennial in the nightshade famil ...
, 235 thousand tons of cocoa (7th largest producer in the world), 149 thousand tons of
pineapple The pineapple (''Ananas comosus'') is a Tropical vegetation, tropical plant with an edible fruit; it is the most economically significant plant in the family Bromeliaceae. The pineapple is indigenous to South America, where it has been culti ...
, 103 thousand tons of orange, in addition to smaller productions of other agricultural products. In more recent years
banana production
has increased to around 7 million tons annually
7.16 million tons
produced in 2023).


Mining

In 2019, the country had an annual production of about 1 ton of
antimony Antimony is a chemical element; it has chemical symbol, symbol Sb () and atomic number 51. A lustrous grey metal or metalloid, it is found in nature mainly as the sulfide mineral stibnite (). Antimony compounds have been known since ancient t ...
(14th largest producer in the world). In 2006, Ecuador had an annual production of about 5.3 tonnes of
gold Gold is a chemical element; it has chemical symbol Au (from Latin ) and atomic number 79. In its pure form, it is a brightness, bright, slightly orange-yellow, dense, soft, malleable, and ductile metal. Chemically, gold is a transition metal ...
, being the 34th largest producer in the world at the time. Ecuador produced 8.6 tons of gold in 2013, which was the absolute record between 2006 and 2017. In 2017, production was 7.3 tons. In terms of
silver Silver is a chemical element; it has Symbol (chemistry), symbol Ag () and atomic number 47. A soft, whitish-gray, lustrous transition metal, it exhibits the highest electrical conductivity, thermal conductivity, and reflectivity of any metal. ...
production, Ecuador produced 1 ton in 2017, which is the country's usual average. In 2019, in the north of Ecuador, a large deposit of gold, silver and copper was discovered.


Industries

Oil accounts for 40% of exports and contributes to maintaining a positive trade balance. Since the late '60s, the exploitation of oil increased production and reserves are estimated at 4.036 million barrels In the agricultural sector, Ecuador is a major exporter of bananas (the largest exporter of bananas in the world), cut flowers, cacao, coffee, shrimp, wood, and fish. It is also significant in shrimp production, sugar cane, rice, cotton, corn, palm and coffee. The country's vast resources include large amounts of timber across the country, like eucalyptus and mangroves.Mapping for Results – Ecuador, Latin America & Caribbean
maps.worldbank.org
Pines and cedars are planted in the region of the Sierra, walnuts and rosemary, and balsa wood, on Guayas River Basin. Ecuador's tobacco is prized in the cigar industry due to the prolonged cloud cover and rich volcanic soil creating ideal growing conditions, especially for shade tobacco and Ecuadorian Sumatra Tobacco cigar wrapper leaves;Retrieved on 2022-09-04.
/ref> exports topped $70M in 2018.Retrieved on 2022-09-04.
/ref> Oil Industry in Ecuador Ecuador's oil industry is a cornerstone of its economy, contributing significantly to export earnings and government revenues. As of 2023, the country holds approximately 8.3 billion barrels of proven crude oil reserves . In 2022, crude oil accounted for about 27% of Ecuador's total export value, with major export destinations including Latin America, North America, and Asia. The state-owned company Petroecuador plays a pivotal role in the oil sector, often operating in partnership with private and foreign corporations . Recent initiatives aim to boost oil production through foreign investments, with plans to attract approximately $42 billion in the oil sector by 2029 . However, oil extraction has raised environmental and social concerns, particularly in the Amazon region. In 2023, a national referendum led to the cessation of oil drilling in Block 43 within Yasuni National Park, a biodiverse area home to Indigenous communities. Agricultural Sector in Ecuador Agriculture remains a vital component of Ecuador's economy, accounting for a significant portion of exports. The country is the world's largest exporter of bananas, with exports valued at approximately $2 billion . Other major agricultural exports include shrimp, cacao, coffee, and cut flowers. In 2020, agricultural products represented about 41.1% of Ecuador's total export. Ecuador's diverse climate and fertile soil enable the cultivation of various crops, including rice, sugar cane, cotton, corn, and palm. The country's forestry resources, such as eucalyptus, mangroves, pine, cedar, and balsa wood, also contribute to its export economy. The industry is concentrated mainly in
Guayaquil Guayaquil (), officially Santiago de Guayaquil, is the largest city in Ecuador and also the nation's economic capital and main port. The city is the capital (political), capital of Guayas Province and the seat of Guayaquil Canton. The city is ...
, the largest industrial center, and in
Quito Quito (; ), officially San Francisco de Quito, is the capital city, capital and second-largest city of Ecuador, with an estimated population of 2.8 million in its metropolitan area. It is also the capital of the province of Pichincha Province, P ...
, where in recent years the industry has grown considerably. This city is also the largest business center of the country. Industrial production is directed primarily to the domestic market. Despite this, there is limited export of products produced or processed industrially. These include canned foods, liquor, jewelry, furniture, and more. Minor industrial activity is also concentrated in Cuenca.Industrias en CUENCA
Guia-cuenca.guiaespana.com.es. Retrieved on 2012-08-21.
The dairy industry is represented by companies such as Tonicorp, which is owned by the Coca Cola Company.


Electricity

As of December 2022, the generation and transmission infrastructure of Ecuador included: * total installed generation capacity of 8,864
megawatts The watt (symbol: W) is the unit of power or radiant flux in the International System of Units (SI), equal to 1 joule per second or 1 kg⋅m2⋅s−3. It is used to quantify the rate of energy transfer. The watt is named in honor o ...
(MW) that included ** 5,425 MW of
renewable energy Renewable energy (also called green energy) is energy made from renewable resource, renewable natural resources that are replenished on a human lifetime, human timescale. The most widely used renewable energy types are solar energy, wind pow ...
generation with *** about 5200 MW of hydropower (in Ecuador, considered as renewable); * National Interconnection System (SNI) that was able to use 7,472 MW of the total capacity above (including 4375 MW from renewable sources). The remaining 1,390 MW are not part of the countrywide grid; * National Transmission System (SNT) with line voltages 500
kilovolt The volt (symbol: V) is the unit of electric potential, electric potential difference (voltage), and electromotive force in the International System of Units (SI). Definition One volt is defined as the electric potential between two point ...
(kV), 230 kV and 138 kV, 4,382 km of single-circuit lines and 2,462 km of double-circuit lines, including ** interconnection with
Colombia Colombia, officially the Republic of Colombia, is a country primarily located in South America with Insular region of Colombia, insular regions in North America. The Colombian mainland is bordered by the Caribbean Sea to the north, Venezuel ...
(two 230 kV Jamondino- Pomasqui double-circuit lines and a 138 kV
Tulcán :''"Tulcan" is also an alternative spelling of tulchan'' Tulcán () is the capital of the province of Carchi Province, Carchi in Ecuador and the seat of Tulcán Canton. The population of the city of Tulcán was 56,719 in the 2022 census. Tulcán ...
- Panamericana single-circuit line); ** interconnection with
Peru Peru, officially the Republic of Peru, is a country in western South America. It is bordered in the north by Ecuador and Colombia, in the east by Brazil, in the southeast by Bolivia, in the south by Chile, and in the south and west by the Pac ...
(a 230 kV
Machala Machala () is a city in south-west Ecuador. It is the capital of the El Oro Province, and is located near the Gulf of Guayaquil on fertility (soil), fertile lowlands. Machala has a population of 288,072 (2022 census); it is the sixth-biggest city ...
- Zorritos double-circuit line). Distribution is provided through distribution companies with total billing of 2 billion US dollars and electricity losses of 13.25%. As of December 2022, they managed: * 370 substations with total capacity of 8,545 megavolt-amperes (MVA) * 67 sectioning substations; * 5,730 km of subtransmission lines; * 111,276 km of medium voltage lines; * 105,469 km of
low voltage In electrical engineering, low voltage is a relative term, the definition varying by context. Different definitions are used in electric power transmission and distribution, compared with electronics design. Electrical safety codes define "low vo ...
lines * 360,000
distribution transformer image:Polemount-singlephase-closeup.jpg, Single-phase distribution transformer in Canada A distribution transformer or service transformer is a transformer that provides a final voltage reduction in the electric power distribution system, steppin ...
s with a total capacity of 14,100 MVA; * 5.56 million electrical meters (coverage of 97.4%). The peak demand on the SNI grid occurs in April (4,388 MW in 2022). The total generation in 2022 was 33
terawatt-hours A kilowatt-hour ( unit symbol: kW⋅h or kW h; commonly written as kWh) is a non-SI unit of energy equal to 3.6 megajoules (MJ) in SI units, which is the energy delivered by one kilowatt of power for one hour. Kilowatt-hours are a commo ...
(TWh) with 87% delivered by SNI and the rest by provider unincorporated into the grid. The breakdown by the power source at the SNI was as follows: *
hydroelectric Hydroelectricity, or hydroelectric power, is Electricity generation, electricity generated from hydropower (water power). Hydropower supplies 15% of the world's electricity, almost 4,210 TWh in 2023, which is more than all other Renewable energ ...
24.6 TWh (85.3%); *
fossil fuel A fossil fuel is a flammable carbon compound- or hydrocarbon-containing material formed naturally in the Earth's crust from the buried remains of prehistoric organisms (animals, plants or microplanktons), a process that occurs within geolog ...
3.8 TWh (13%); *
biomass Biomass is a term used in several contexts: in the context of ecology it means living organisms, and in the context of bioenergy it means matter from recently living (but now dead) organisms. In the latter context, there are variations in how ...
0.35 TWh (1.2%); *
solar photovoltaic A photovoltaic system, also called a PV system or solar power system, is an electric power system designed to supply usable solar power by means of photovoltaics. It consists of an arrangement of several components, including solar panels to abs ...
,
biogas Biogas is a gaseous renewable energy source produced from raw materials such as agricultural waste, manure, municipal waste, plant material, sewage, green waste, Wastewater treatment, wastewater, and food waste. Biogas is produced by anaerobic ...
,
wind energy Wind power is the use of wind energy to generate useful work. Historically, wind power was used by sails, windmills and windpumps, but today it is mostly used to generate electricity. This article deals only with wind power for electricity ...
less than 1% combined. The amount of reported unavailable generation capacity varied between 1,170 and 1,610 GW in 2019-2022, approximately evenly split between hydro and thermal power stations. The plan of r2023-2032 called for major expansion of the generation capacity, primarily renewable energy (additional 6,300 MW), but with 700 MW of "firm" (thermal) capacity scheduled to come on-line in 2024-2025. This "firm" generation was intended for the electric grid security and "quality of supply". During the 2023-2024 Ecuador electricity crisis, in the fall of 2024, the amount of thermal generation was significantly lower than the numbers above would suggest. For example, according to Miguel Calahorrano, an ex-minister of electricity and renewable energy, only Trinitaria (125 MW), Machala Gas (125 MW), G. Zevallos (146 MW) and Jaramijó (140 MW) were operating at high power until October 15, 2024.


Sciences and research

Ecuador was placed in 96th position of innovation in technology in a 2013
World Economic Forum The World Economic Forum (WEF) is an international non-governmental organization, international advocacy non-governmental organization and think tank, based in Cologny, Canton of Geneva, Switzerland. It was founded on 24 January 1971 by German ...
study. Ecuador was ranked 91st in the
Global Innovation Index The Global Innovation Index is an annual ranking of countries by their capacity for and success in innovation, published by the World Intellectual Property Organization (WIPO). It was started in 2007 by INSEAD and ''World Business'', a Britis ...
in 2021 up from 99th in 2020. The most notable icons in Ecuadorian sciences are the mathematician and cartographer
Pedro Vicente Maldonado Pedro Vicente Maldonado y Flores (November 24, 1704 in Riobamba, Royal Audience of Quito (today's Ecuador) – November 7, 1748 in London, England) was an Ecuadorian scientist who collaborated with the members of the French Geodesic Mission. As ...
, born in Riobamba in 1707, and the printer, independence pioneer, and medical pioneer Eugenio Espejo, born in 1747 in Quito. Among other notable Ecuadorian scientists and engineers are Lieutenant Jose Rodriguez Labandera, who built the first
submarine A submarine (often shortened to sub) is a watercraft capable of independent operation underwater. (It differs from a submersible, which has more limited underwater capability.) The term "submarine" is also sometimes used historically or infor ...
in Latin America in 1837; Reinaldo Espinosa Aguilar (1898–1950), a botanist and biologist of Andean flora; and José Aurelio Dueñas (1880–1961), a chemist and inventor of a method of textile serigraphy, reputed to have many wives. The major areas of scientific research in Ecuador have been in the medical fields, tropical and infectious diseases treatments, agricultural engineering, pharmaceutical research, and bioengineering. Being a small country and a consumer of foreign technology, Ecuador has favored research supported by entrepreneurship in information technology. The antivirus program ''Checkprogram'', banking protection system ''MdLock'', and Core Banking Software ''Cobis'' are products of Ecuadorian development. The scientific production in hard sciences has been limited due to lack of funding but focused around physics, statistics, and partial differential equations in mathematics. In the case of engineering fields, the majority of scientific production comes from the top three polytechnic institutions: Escuela Superior Politécnica del Litoral – '' ESPOL'', Universidad de Las Fuerzas Armadas – '' ESPE'', and Escuela Politécnica Nacional '' EPN''. The Center for Research and Technology Development in Ecuador is an autonomous center for research and technology development funded by Senecyt. However, according to ''
Nature Nature is an inherent character or constitution, particularly of the Ecosphere (planetary), ecosphere or the universe as a whole. In this general sense nature refers to the Scientific law, laws, elements and phenomenon, phenomena of the physic ...
'', the multidisciplinary scientific journal, the top 10 institutions that carry the most outstanding scientific contributions are: Yachay Tech University ( ''Yachay Tech''), Escuela Politécnica Nacional ('' EPN)'', and Universidad San Francisco de Quito ''( USFQ)''.


Trade

The overall trade balance for August 2012 was a surplus of almost 390 million dollars for the first six months of 2012, a huge figure compared with that of 2007, which reached only $5.7 million; the surplus had risen by about 425 million compared to 2006. This circumstance was due to the fact that imports grew faster than exports. The oil trade balance positive had revenues of $3.295 million in 2008, while non-oil was negative amounting to 2.842 million dollars.. The trade balance was positive in 2019 and 2020 with 2.05 billion dollars and 6.4 billion dollars. In 2016, the trade balance was positive (608 million dollars) but negative in 2017 (-723 million dollars) and 2018 (1.41 billion dollars). The trade balance with Argentina, Colombia and Asia is negative. Ecuador has negotiated bilateral treaties with other countries, besides belonging to the
Andean Community of Nations The Andes ( ), Andes Mountains or Andean Mountain Range (; ) are the List of longest mountain chains on Earth, longest continental mountain range in the world, forming a continuous highland along the western edge of South America. The range ...
, and an associate member of
Mercosur The Southern Common Market (commonly known by abbreviation ''Mercosur'' in Spanish and ''Mercosul'' in Portuguese) is a South American trade bloc established by the Treaty of Asunción in 1991 and Protocol of Ouro Preto in 1994. Its full me ...
. It also belongs to the
World Trade Organization The World Trade Organization (WTO) is an intergovernmental organization headquartered in Geneva, Switzerland that regulates and facilitates international trade. Governments use the organization to establish, revise, and enforce the rules that g ...
(WTO), in addition to the
Inter-American Development Bank The Inter-American Development Bank (IDB or IADB) is an international development finance institution headquartered in Washington, D.C., United States of America. It serves as one of the leading sources of development financing for the countri ...
(IDB),
World Bank The World Bank is an international financial institution that provides loans and Grant (money), grants to the governments of Least developed countries, low- and Developing country, middle-income countries for the purposes of economic development ...
,
International Monetary Fund The International Monetary Fund (IMF) is a major financial agency of the United Nations, and an international financial institution funded by 191 member countries, with headquarters in Washington, D.C. It is regarded as the global lender of las ...
(IMF), Development Bank of Latin America and the Caribbean (CAF) and other multilateral agencies. In April 2007, Ecuador paid off its debt to the IMF thus ending an era of interventionism of the Agency in the country. The public finance of Ecuador consists of the Central Bank of Ecuador (BCE), the National Development Bank (BNF), the State Bank, the National Finance Corporation, the Ecuadorian Housing Bank (BEV) and the Ecuadorian Educational Loans and Grants.Ecuador student loan program increases funding for overseas study
Bmimedia.net (January 6, 1990). Retrieved on 2012-08-21.


Economic history

Deteriorating economic performance in 1997–98 culminated in a severe financial crisis in 1999. The crisis was precipitated by a number of external shocks, including the
El Niño EL, El or el may refer to: Arts and entertainment Fictional entities * El, a character from the manga series ''Shugo Chara!'' by Peach-Pit * Eleven (''Stranger Things'') (El), a fictional character in the TV series ''Stranger Things'' * El, fami ...
weather phenomenon in 1997, a sharp drop in global
oil price The price of oil, or the oil price, generally refers to the spot price of a Oil barrel, barrel () of benchmark crude oil—a reference price for buyers and sellers of crude oil such as West Texas Intermediate (WTI), Brent Crude, Dubai Crud ...
s in 1997–98, and international emerging market instability in 1997–98. These factors highlighted the Government of Ecuador's unsustainable economic policy mix of large fiscal deficits and expansionary money policy and resulted in a 7.3% contraction of GDP, annual year-on-year inflation of 52.2%, and a 65%
devaluation In macroeconomics and modern monetary policy, a devaluation is an official lowering of the value of a country's currency within a fixed exchange-rate system, in which a monetary authority formally sets a lower exchange rate of the national curre ...
of the national currency in 1999. On January 9, 2000, the administration of President Jamil Mahuad announced its intention to adopt the U.S. dollar as the official currency of Ecuador to address the ongoing economic crisis. Subsequent protest led to the 2000 Ecuadorean coup d'état which saw Mahuad's removal from office and the elevation of Vice President
Gustavo Noboa Gustavo José Joaquín Noboa Bejarano (21 August 1937 – 16 February 2021) was an Ecuadorian politician who served as the 42nd president of Ecuador from 22 January 2000 to 15 January 2003. Previously he served as the 42nd Vice President of Ecua ...
to the presidency. US Dollar has been the only official currency of Ecuador since the year 2000. The Noboa government confirmed its commitment to convert to the dollar as the centerpiece of its economic recovery strategy, successfully completing the transition from
sucre Sucre (; ) is the ''de jure'' capital city of Bolivia, the capital of the Chuquisaca Department and the sixth most populous city in Bolivia. Located in the south-central part of the country, Sucre lies at an elevation of . This relatively high ...
s to dollars in 2001. Following the completion of a one-year stand-by program with the
International Monetary Fund The International Monetary Fund (IMF) is a major financial agency of the United Nations, and an international financial institution funded by 191 member countries, with headquarters in Washington, D.C. It is regarded as the global lender of las ...
(IMF) in December 2001, Ecuador successfully negotiated a new $205 million stand-by agreement with the IMF in March 2003. Buoyed by higher oil prices, the Ecuadorian economy experienced a modest recovery in 2000–01, with GDP rising 2.3% in 2000 and 5.4% in 2001. GDP growth leveled off to 2.7% in 2002. Inflation fell from an annual rate of 96.1% in 2000 to an annual rate of 37.7% in 2001; 12.6% for 2002. The completion of the second Transandean Oil Pipeline (OCP in Spanish) in 2003 enabled Ecuador to expand oil exports. The OCP will double Ecuador's oil transport capacity. Ecuador's economy is the eighth largest in Latin America and experienced an average growth of 4.6% per year between 2000 and 2006. In January 2009, the Central Bank of Ecuador (BCE) put the 2010 growth forecast at 6.88%. GDP doubled between 1999 and 2007, reaching 65,490 million dollars according to BCE. Inflation rate up to January 2008 was located about 1.14%, the highest recorded in the last year, according to Government. The monthly unemployment rate remained at about 6 and 8 percent from December 2007 until September 2008, however, it went up to about 9 percent in October and dropped again in November 2008 to 8 percent. Between 2006 and 2009, the government increased spending on social welfare and education from 2.6% to 5.2% of its GDP.Ecuador's Economy Since 2007 , Reports
. Cepr.net. Retrieved on 2012-08-21.
Starting in 2007, when its economy was surpassed by the economic crisis, Ecuador was subject to a number of economic policy reforms by the government that have helped steer the Ecuadorian economy to a sustained, substantial, and focused achievement of financial stability and consistent social policy. Such policies were expansionary fiscal policies, of access to housing finance, stimulus packs, and limiting the amount of money reserves banks could keep abroad. The Ecuadorian government has made huge investments in education and infrastructure throughout the nation, which have improved the lives of the poor. On December 12, 2008, President
Rafael Correa Rafael Vicente Correa Delgado (; born 6 April 1963) is an Ecuadorian politician and economist who served as the 45th president of Ecuador from 2007 to 2017. The leader of the PAIS Alliance political movement from its foundation until 2017, Corr ...
announced that Ecuador would not pay $30.6m in interest to lenders of a $510m loan, claiming that they were monsters.Mapstone, (December 13, 2008)
Ecuador defaults on sovereign bonds
Financial Times The ''Financial Times'' (''FT'') is a British daily newspaper printed in broadsheet and also published digitally that focuses on business and economic Current affairs (news format), current affairs. Based in London, the paper is owned by a Jap ...
In addition it claimed that $3.8bn in foreign debt negotiated by previous administrations was illegitimate because it was authorized without executive decree. At the time of the announcement, the country had $5.65bn in cash reserves. In 2009, economic growth declined to 0.6% during the global recession, accompanied by falling oil prices and a decline in remittances provided by Ecuadorians living and working abroad (a major source of external revenues). Showing signs of recovery in 2010, the economy rebounded and grew by 2.8%. After growth of 7.4% in 2011, Ecuador's growth averaged 4.5% from 2012 to 2014. Some observers have attributed the high growth to a public investment boom that was fueled by high oil prices and lending from China. According to the U.S. Energy Information Administration, Ecuador was the third largest source of foreign oil to the western United States in 2014. However, in the middle of 2014 after the price of oil declined significantly, Ecuador's oil earnings fell. As a consequence, the Economist Intelligence Unit (EIU) forecast that Ecuador's economy would contract slightly in 2015, although the economy ultimately grew by less than half a percent. President Correa's plans to begin extracting crude oil from the Ishpingo, Tambochoa, and Tiputini field in Yasuní National Park in the Amazon to provide an economic boost did not salvage the economy from going into recession. In 2016, Ecuador's gross domestic product contracted by 1.6%. Ecuador's economic slowdown in 2016 and the country's need for external finance were exacerbated by a deadly April 2016 earthquake. Ecuador's estimated $3 billion costs for reconstruction and humanitarian assistance for 720,000 people in the affected region remain a burden that the government and private sector have sought to address. In response, the U.S. Office of Foreign Disaster Assistance provided more than $3 million in assistance, including provisions airlifted in for 50,000 people in the earthquake-prone region and assistance with water and sanitation systems in affected areas. A U.N. appeal by the Office of Coordination of Humanitarian Assistance sought to raise $73 million. However, as of July 2016, only one-fifth of this amount had been received from donor countries, including the United States. The Correa government increased a value-added tax and implemented a plan to further cut government expenditures after cutting capital expenditures by 30%. Despite President Correa's reluctance to ask for assistance from the International Monetary Fund (IMF), the IMF approved a request for $364 million in financial support under its Rapid Financing Instrument in early July 2016 for Ecuador. Additional loans from China and the World Bank to help ease the government's balance-of-payments needs were considered. Ecuador's access to global financial markets also had been limited by its 2008 default on $3.2 billion in debt to global lenders. Consequently, the Correa government turned to nontraditional allies, such as China, for external finance. From 2005 to 2014, Chinese banks provided almost $11 billion of financing to Ecuador. The Correa government also asked China for an additional $7.5 billion in financing in early 2015 as crude oil prices—the nation's biggest export—weakened further. China agreed to the financing request and began to disburse funding, including nearly $1 billion in May and June 2015. Ecuador successfully returned to the international capital market in June 2014 with a $2 billion bond issue followed by additional smaller bond issues in 2015. President Moreno later discovered loans made by China over the years currently require that Ecuador pay China back with almost 500 barrels of crude oil—or roughly three years of the country's oil production. According to press reports, some private sector analysts question whether Ecuador will be able to meet its debt obligations given two strains on the country's public finances: the slump in oil income due to the commodity's low price and the strong U.S. dollar, which, as a result of Ecuador's dollarized economy, makes the country's exports less globally competitive. Ecuador withdrew from efforts to develop a regional free trade agreement (FTA) between the United States and Bolivia, Colombia, Ecuador, and Peru in 2006. The United States subsequently signed bilateral FTAs with Peru and Colombia, but Ecuador showed no interest in pursuing an FTA with the United States. Following Venezuela's acceptance in 2012 to full membership in the South American customs union, Mercosur (Mercado Común del Sur or Common Market of the South), the leftist governments in Bolivia and Ecuador applied to move from observer status to full membership in the trade bloc originally composed of Argentina, Brazil, Paraguay, and Uruguay. According to some observers, out of a concern for Ecuador's struggling non-oil exporters, Correa embraced a trade agreement with the European Union (EU) as part of the EU-Andean Community Association agreement that went into effect in January 2017. The
International Monetary Fund The International Monetary Fund (IMF) is a major financial agency of the United Nations, and an international financial institution funded by 191 member countries, with headquarters in Washington, D.C. It is regarded as the global lender of las ...
approved an agreement with Ecuador in March 2019. This arrangement would provide support ($10 billion) for the Ecuadorian government's economic policies over three years (2018–2021 Prosperity Plan).


Poverty and inequality

, an estimated 9 million Ecuadorians have an economic occupation and about 1.01 million inhabitants are in unemployment condition. In 1998, 10% of the richest population had 42.5% of income, while 10% of the poor had only 0.6% of income. The rates of poverty were higher for populations of indigenous, afro-descendents, and rural sectors. During the same year, 7.6% of health spending went to the 20% of the poor, while 20% of the rich population received 38.1% of this expenditure. The extreme poverty rate has declined significantly between 1999 and 2010. In 2001 it was estimated at 40% of the population, while by 2011 the figure dropped to 17.4% of the total population. This is explained largely by emigration and economic stability achieved after adopting the U.S. dollar as official means of transaction . Poverty rates were higher for indigenous peoples, Afro-descendants and rural areas, reaching 44% of the Native ancestry population.


Infrastructure development

The industrial sector has had enormous difficulty to emerge significantly. The industrial sector's main problem is the deficit of energy, which the current government has tackled with the improvement of performance on existing hydro plants, and the creation of new ones. Such projects included negotiation of the Coca-Codo hydroplant. Incentives of financing, tributary incentives, tariffs, and others will be implemented, that is intended to benefit areas of tourism, food processing, renewable and alternative energy sources, bioenergies, pharmaceutical and chemical products, biochemical and environmental biomedicine, services, automotive metallurgical industry, footwear, and automotive parts and pieces, among others. A 500 kV transmission line increases national grid strength and electricity trade with
Peru Peru, officially the Republic of Peru, is a country in western South America. It is bordered in the north by Ecuador and Colombia, in the east by Brazil, in the southeast by Bolivia, in the south by Chile, and in the south and west by the Pac ...
and Colombia.


Statistics


Main economic indicators

The following table shows the main economic indicators in 1980–2019 (with IMF staff stimtates in 2020–2025). Inflation below 5% is in green.


See also

* Banking in Ecuador *
Economy of South America The economy of South America comprises approximately 434 million people living in the 12 sovereign states and three dependent territories of South America, which encompasses 6 percent of the world's population. In 2025, South America ranks fo ...
* Economic history of Ecuador * Ecuador Census * China–Ecuador relations * Latin American economy * List of Latin American and Caribbean countries by GDP growth *
List of Latin American and Caribbean countries by GDP (nominal) This is a list of Latin American and Caribbean countries by gross domestic product (nominal) in USD according to the International Monetary Fund (IMF)'s estimates in April 2025 World Economic Outlook database. Cuba is not included in the list due ...
*
List of Latin American and Caribbean countries by GDP (PPP) This is a list of Latin American and the Caribbean countries by gross domestic product at purchasing power parity in international dollars according to the International Monetary Fund's estimates in the April 2025 World Economic Outlook database. ...


References


Further reading

* *


External links


World Bank Summary Trade Statistics Ecuador
* *Tariffs applied by Ecuador as provided by ITC'
Access Map
an online database of customs tariffs and market requirements. *
Electricity grid map

Solar insolation maps
{{South America in topic, Economy of
Ecuador Ecuador, officially the Republic of Ecuador, is a country in northwestern South America, bordered by Colombia on the north, Peru on the east and south, and the Pacific Ocean on the west. It also includes the Galápagos Province which contain ...
Ecuador Ecuador, officially the Republic of Ecuador, is a country in northwestern South America, bordered by Colombia on the north, Peru on the east and south, and the Pacific Ocean on the west. It also includes the Galápagos Province which contain ...