Ecuador is one of the smaller countries of South America, rich in culture, history and biodiversity. Being a colony for more than two centuries, the Spanish influences are still noticeable nowadays. Although the COVID-19 also led to a contraction of the GDP, the Ecuadorian economy has been one of the most stable in Latin America over the years.
Private consumption and gross fixed investment will continue to support the economy.
Ecuador is currently making an effort to become more integrated with international markets through increased South-South integration of Latin American countries but also with other countries all over the world, including the EU.
Because of its diverse geographic areas, Ecuador contains a wealth of natural beauty and diversity, being one of the 17 mega-biodiverse countries in the world. The country has around 23.056 taxonomic species of animals and plants reported. This makes agriculture and the food industry play an important role in the Ecuadorian economy, as a quarter of the total population is employed in this sector. Currently, Ecuador is the biggest exporter of bananas, the number one exporter of shrimps and prawns, and one of the biggest tuna exporters in the world. Moreover, the country offers mineral potential such as copper and gold, but the Ecuadorian ground is also rich in both oil and gas. Around 95 per cent of the Ecuadorian exports towards the Netherlands consist of agricultural and food products, amounting to approximately 450 million per year. The current active government policy on reforestation provides an interesting sustainable investment opportunity.
Ecuador has been part of the Comunidad Andina since 1996, a trade union which also includes Peru, Bolivia and Colombia. This free trade area has developed into an international community that is based on the European Union, to strengthen economic linkages and enhance trade and investment related activities, as well as to contribute to minimising development gaps among the participating countries. Dollarization of the economy also limits currency and transfer risks and anchors inflation. The Ecuadorian economy is service-based, accounting for almost 60 percent of the GDP. However, Dutch opportunities also lie in the water- and energy sector and the mining industry. Economic growth and the corresponding rise in energy consumption require investments in this sector. Primary consumption is still dominated by oil, as Ecuador has the third largest oil reserves on the South American continent but is looking towards renewable energy projects, like hydroelectric energy, to power its future.
The country has a historic issue with mobility but investments are connecting isolating areas to developed ones and providing opportunities both for local and international companies looking to invest. The modernization of the airport and port sector are emblematic of the logistic sector in Ecuador, with the old making way for the new.
Are you interested in exploiting the many benefits that the Ecuadorian market has to offer? Through tailor-made research and more than 30 years of experience, IBR would like to explore your company’s opportunities in Ecuador with you.