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The Economy of Ecuador

Ecuadorian Economy

Ecuador's map

Economy - overview: Ecuador is substantially dependent on its petroleum resources, which have accounted for more than half of the country's export earnings and one-fourth of public sector revenues in recent years. In 1999/2000, Ecuador suffered a severe economic crisis, with GDP contracting by more than 6%. Poverty increased significantly, the banking system collapsed, and Ecuador defaulted on its external debt later that year. In March 2000, Congress approved a series of structural reforms that also provided for the adoption of the US dollar as legal tender. Dollarization stabilized the economy, and positive growth returned in the years that followed, helped by high oil prices, remittances, and increased non-traditional exports. From 2002-06 the economy grew 5.5%, the highest five-year average in 25 years. The poverty rate declined but remained high at 38% in 2006. In 2006 the government imposed a windfall revenue tax on foreign oil companies, leading to the suspension of free trade negotiations with the US. These measures led to a drop in petroleum production in 2007. President Rafael CORREA raised the specter of debt default and followed through on those threats in December 2008 by defaulting on some commercial bond obligations. He also decreed a higher windfall revenue tax on private oil companies, then renegotiated their contracts to overcome the debilitating effect of the tax. This generated economic uncertainty; private investment has dropped and economic growth has slowed.

GDP:

GDP - real growth rate: 5.9% (2008 est.) 2.4% (2007 est.) 3.9% (2006 est.)

GDP - per capita:

GDP - composition by sector: agriculture: 6.6% industry: 33.9% services: 59.5% (2008 est.)

Population below poverty line:

Household income or consumption by percentage share: lowest 10%: 2% highest 10%: 35% note: data for urban households only (October 2006)

Distribution of family income - Gini index: 46 note: data are for urban households (2006)

Inflation rate (consumer prices):

Labor force: 4.64 million (urban) (2008 est.)

Labor force - by occupation: agriculture: 8.3% industry: 21.2% services: 70.4% (2005)

Unemployment rate: 8.7% (2008 est.)

Budget: revenues: $19.44 billion expenditures: planned $17.79 billion (2008 est.)

Industries: petroleum, food processing, textiles, wood products, chemicals

Industrial production growth rate: 2% (2008 est.)

Electricity - production: 14.84 billion kWh (2006 est.)

Electricity - production by source:

Electricity - consumption: 12.9 billion kWh (2006 est.)

Electricity - exports: 38.53 million kWh (2006 est.)

Electricity - imports: 861 million kWh (2006 est.)

Oil - production: 511,600 bbl/day (2007 est.)

Oil - consumption: 160,500 bbl/day (2006 est.)

Oil - exports: 421,700 bbl/day (2005 est.)

Oil - imports: 47,060 bbl/day (2005)

Oil - proved reserves: 4.517 billion bbl (1 January 2008 est.)

Natural gas - production: 280 million cu m (2006 est.)

Natural gas - consumption: 280 million cu m (2006 est.)

Natural gas - exports: 0 cu m (2007 est.)

Natural gas - imports: 0 cu m (2007 est.)

Natural gas - proved reserves: 9.369 billion cu m (1 January 2006 est.)

Agriculture - products: bananas, coffee, cocoa, rice, potatoes, manioc (tapioca), plantains, sugarcane; cattle, sheep, pigs, beef, pork, dairy products; balsa wood; fish, shrimp

Exports: $19.4 billion (2008 est.)

Exports - commodities: petroleum, bananas, cut flowers, shrimp, cacao, coffee, hemp, wood, fish

Exports - partners: US 41.9%, Peru 8.5%, Chile 4.9%, Russia 4.8%, Colombia 4.7% (2007)

Imports: $16.6 billion f.o.b. (2008 est.)

Imports - commodities: industrial materials, fuels and lubricants, nondurable consumer goods

Imports - partners: US 23.7%, Colombia 10.3%, China 7.6%, Brazil 5.3%, Japan 4.3% (2007)

Debt - external: $16.96 billion (31 December 2008 est.)

Economic aid - recipient:

Currency:

Currency code:

Exchange rates: the US dollar is used; the sucre was eliminated in 2000

Fiscal year: