ASSESSMENTS

Ecuador Takes a Business-Friendly Turn

Jul 2, 2018 | 09:00 GMT

Cocoa beans, one of Ecuador's top 10 exports, await shipment from Guayaquil.

Cocoa beans await shipment from the Inmobiliaria Guangala exporting company on the outskirts of Guayaquil, Ecuador, on May 3, 2014. The CCN51 variety of cocoa, resistant to plagues though sour tasting, could be the next star in the market, and its growing has shot up on the Ecuadorian coast.

(RODRIGO BUENDIA/AFP/Getty Images)

Highlights

Since the current Ecuadorian government has blocked former President Rafael Correa from returning to power in the 2021 election, the risk of expropriation or abrupt regulatory changes in the country will decline.
Over the coming years, President Lenin Moreno's administration will work to reduce Ecuador's persistent budget deficit and ease its economic reliance on oil production for export.
The country's government will consider cutting red tape for investors — including a surcharge Correa imposed on currency outflows.

Ecuador is open for business. Since coming to power in May 2017, President Lenin Moreno has set about addressing the country's financial problems with economic and political reforms to better promote trade and investment. At the same time, he has tried to reduce the influence of his predecessor in Ecuadorian politics in an effort to preserve his policies. Voters blocked former President Rafael Correa's path back to power in February by reinstating term limits in a referendum. And without a clear successor to take up Correa's torch, his more left-leaning faction of the ruling Alianza Pais coalition may find itself on the sidelines after the 2021 presidential and parliamentary elections. That means the business-friendly regulatory changes Moreno is pushing for -- such as tax reductions and measures to lower the risk of expropriation -- will last into the next government....

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