# Economy of Ecuador
Ecuador is a dollarized, commodity-exporting Andean economy of about 18.1 million people whose output in 2024 reached USD 124,676 million nominally (USD 113,123 million in chained 2018 terms) and which contracted 2.0% that year after three consecutive years of growth.[1](https://contenido.bce.fin.ec/documentos/informacioneconomica/cuentasnacionales/trimestrales/Informe_CNTIVTrim2024.pdf) • [2](https://unctadstat.unctad.org/CountryProfile/GeneralProfile/en-GB/218/index.html) Its income rests on oil, world-leading agricultural exports (shrimp, bananas, canned fish, flowers), a growing mining sector, and remittances from Ecuadorians abroad, all under a monetary system that uses the US dollar.[3](https://www.afd.fr/sites/default/files/2020-09-04-23-15/official-dollarization-ecuador.pdf) • [4](https://www.worldbank.org/ext/en/country/ecuador)
| Key fact | Detail |
|---|---|
| GDP 2024 | USD 124,676 million nominal; real GDP fell 2.0%, then rebounded 3.7% in 2025 with 2.8% expected in 2026[1](https://contenido.bce.fin.ec/documentos/informacioneconomica/cuentasnacionales/trimestrales/Informe_CNTIVTrim2024.pdf) • [4](https://www.worldbank.org/ext/en/country/ecuador) |
| Inflation | 1.4% year-on-year in October 2024, versus nearly 40% average annually in the 21 years before dollarization and 3.2% in the 22 years after[5](https://www.elibrary.imf.org/view/journals/002/2024/357/article-A001-en.xml) • [6](https://link.springer.com/article/10.1007/s10479-024-06365-y) |
| Oil's weight | About 8% of GDP, 36% of exports in 2019 (down from 57% in 2013), and roughly one-third of government revenue[7](https://contenido.bce.fin.ec/documentos/Administracion/EvolEconEcu_2024pers2025.pdf) • [3](https://www.afd.fr/sites/default/files/2020-09-04-23-15/official-dollarization-ecuador.pdf) |
| Remittances | USD 6,539.8 million in 2024, up 20.1% year-on-year; peaked at about 6.5% of GDP in 2007[7](https://contenido.bce.fin.ec/documentos/Administracion/EvolEconEcu_2024pers2025.pdf) • [8](https://repositorio.bce.ec/bitstream/32000/2344/1/3%20External%20Shocks%20on%20a%20Dollarized%20Economy%20An%20Empirical%20Evidence%20From%20Ecuador.pdf) |
| Trade | Record 2024 surplus of USD 6,678.3 million, the highest since dollarization; exports up 10.6%, imports down 4.8%[7](https://contenido.bce.fin.ec/documentos/Administracion/EvolEconEcu_2024pers2025.pdf) |
| Poverty and informality | Poverty 25.5% in 2024H1; informality exceeds 50% of the labor market[5](https://www.elibrary.imf.org/view/journals/002/2024/357/article-A001-en.xml) • [4](https://www.worldbank.org/ext/en/country/ecuador) |
| IMF program | 48-month Extended Fund Facility approved May 2024, US$4 billion of IMF access (US$5 billion total financing per the World Bank), with US$1 billion disbursed immediately[9](https://www.imf.org/-/media/files/publications/cr/2024/english/1ecuea2024001.pdf) • [4](https://www.worldbank.org/ext/en/country/ecuador) |
## Historical background: from oil boom to dollarization
Ecuador's growth record divides into four eras. [Real GDP](https://www.edgepedia.org/real-gdp) grew an average of 5.2% a year from 1960 to 1980, slowed to 2.9% from 1980 to 2000, recovered to 3.7% during 2001–2014, and averaged only 1.6% from 2014 through 2023.[10](https://www.imf.org/-/media/files/publications/cr/2024/english/1ecuea2024003-print-pdf.pdf) The 1970s oil boom set a pattern of state spending that returned after 2007, when government expenditures rose sharply on historically high oil prices to levels similar to that earlier boom.[11](https://mafhola.uchicago.edu/wp-content/uploads/Ecuador_Cueva_Diaz.pdf)
**The 1999 collapse.** In 1999 GDP contracted 6.3%, the fiscal deficit exceeded 5% of GDP, inflation closed the year at 61%, public debt exceeded 100% of GDP and was in default, and the sucre lost two-thirds of its end-1998 value.[12](https://www.elibrary.imf.org/view/journals/002/2006/103/article-A001-en.xml) [Unemployment](https://www.edgepedia.org/unemployment) peaked at 16.9% in mid-1999.[12](https://www.elibrary.imf.org/view/journals/002/2006/103/article-A001-en.xml) When formal dollarization was launched in early 2000, banking system deposits were frozen and 16 financial institutions accounting for 65% of onshore deposits had been intervened or closed.[12](https://www.elibrary.imf.org/view/journals/002/2006/103/article-A001-en.xml)
## Structure of the economy
**Oil** contributes about 8% of GDP and roughly one-third of government revenue, but its export share has fallen from 57% in 2013 to 36% in 2019 as non-oil exports grew.[7](https://contenido.bce.fin.ec/documentos/Administracion/EvolEconEcu_2024pers2025.pdf) • [3](https://www.afd.fr/sites/default/files/2020-09-04-23-15/official-dollarization-ecuador.pdf) **Agriculture and fishing** supply the country's most distinctive exports: as of April 2019 Ecuador was the world's leading exporter of shrimp (15.6% of total exports), bananas (15.6%), canned fish (5.3%), and natural flowers (4.6%).[3](https://www.afd.fr/sites/default/files/2020-09-04-23-15/official-dollarization-ecuador.pdf) In 2024 non-oil exports grew 12.1%, led by cocoa products and canned fish.[7](https://contenido.bce.fin.ec/documentos/Administracion/EvolEconEcu_2024pers2025.pdf)
**Mining** is the newest pillar. The two large-scale mines, Fruta del Norte and Mirador, extracted 19.5 million tonnes of ore between January and September 2024, up 3.9% from 18.7 million tonnes a year earlier, with Fruta del Norte's plant processing 5,000 tonnes per day.[7](https://contenido.bce.fin.ec/documentos/Administracion/EvolEconEcu_2024pers2025.pdf) The sector is exposed to operational and social friction: in 2024 mining value added fell 3.2% as copper concentrate export tonnage dropped 14.2%, with Mirador running at roughly half capacity during power cuts.[1](https://contenido.bce.fin.ec/documentos/informacioneconomica/cuentasnacionales/trimestrales/Informe_CNTIVTrim2024.pdf)
**Remittances** are the fourth pillar. They reached USD 6,539.8 million in 2024, growing 20.1% year-on-year.[7](https://contenido.bce.fin.ec/documentos/Administracion/EvolEconEcu_2024pers2025.pdf) At their 2007 peak they represented about 6.5% of GDP, 10.2% of household consumption, and 59.9% of non-oil exports; net remittances were 2.5% of GDP in 2018, mostly from the United States.[8](https://repositorio.bce.ec/bitstream/32000/2344/1/3%20External%20Shocks%20on%20a%20Dollarized%20Economy%20An%20Empirical%20Evidence%20From%20Ecuador.pdf) • [3](https://www.afd.fr/sites/default/files/2020-09-04-23-15/official-dollarization-ecuador.pdf) Ecuadorian economists including Alberto Acosta, Rafael Correa, and Carlos Larrea regard them as a principal factor sustaining dollarization after the financial crisis.[8](https://repositorio.bce.ec/bitstream/32000/2344/1/3%20External%20Shocks%20on%20a%20Dollarized%20Economy%20An%20Empirical%20Evidence%20From%20Ecuador.pdf)
## Dollarization: how it works and what it costs
Dollarization was adopted in early 2000 as the escape from the 1999 collapse.[12](https://www.elibrary.imf.org/view/journals/002/2006/103/article-A001-en.xml) Its measurable record is favorable on stability: average annual inflation was nearly 40% in the 21 years before dollarization was completed and 3.2% in the 22 years after, and the economy's real growth rate rose by over 1% per annum, from 2.5% to 3.6%.[6](https://link.springer.com/article/10.1007/s10479-024-06365-y) After dollarization inflation converged to international levels, GDP growth in 2004–05 was 4% with the oil sector expanding 8% a year, and public debt fell to less than half its 1999 level.[12](https://www.elibrary.imf.org/view/journals/002/2006/103/article-A001-en.xml)
The costs are real and specific. The accumulated stock of dollars in circulation cost approximately $20 billion, with an ongoing operational cost of 1.2% of GDP in world goods and services.[6](https://link.springer.com/article/10.1007/s10479-024-06365-y) [Dollarization](https://www.edgepedia.org/dollarization) also removed the exchange-rate tool: the real effective exchange rate appreciated substantially after adoption, and Ecuador cannot devalue to restore competitiveness.[12](https://www.elibrary.imf.org/view/journals/002/2006/103/article-A001-en.xml)
## By the numbers
The 2024 contraction was broad: household consumption fell 1.3%, government spending 1.2%, and gross fixed capital formation 3.8%.[1](https://contenido.bce.fin.ec/documentos/informacioneconomica/cuentasnacionales/trimestrales/Informe_CNTIVTrim2024.pdf) [Inflation](https://www.edgepedia.org/inflation) decelerated from a 2.7% peak in April 2024 to 1.4% year-on-year in October, with core inflation at 2.1%; the IMF had projected a 2024 average of 2.4%, mainly reflecting a higher VAT rate.[5](https://www.elibrary.imf.org/view/journals/002/2024/357/article-A001-en.xml) • [9](https://www.imf.org/-/media/files/publications/cr/2024/english/1ecuea2024001.pdf) Poverty stood at 25.5% in the first half of 2024, slightly lower than before but rising in rural areas, and one in ten Ecuadorians lives in extreme poverty.[5](https://www.elibrary.imf.org/view/journals/002/2024/357/article-A001-en.xml) • [4](https://www.worldbank.org/ext/en/country/ecuador) Gross international reserves rose from US$4.5 billion at end-2023 to US$7.7 billion by end-November 2024.[5](https://www.elibrary.imf.org/view/journals/002/2024/357/article-A001-en.xml)
Headline figures differ across institutions, and the differences are methodological rather than small. The Banco Central del Ecuador puts 2024 nominal GDP at USD 124,676 million while UNCTADstat reports US$121,800 million; BCE records a 2024 trade surplus of USD 6,678.3 million on a balance-of-payments basis while UNCTADstat's merchandise balance is US$4,930 million; and the IMF's Article IV projected a 0.4% contraction for 2024 before the actual outcome proved to be 2.0%.[1](https://contenido.bce.fin.ec/documentos/informacioneconomica/cuentasnacionales/trimestrales/Informe_CNTIVTrim2024.pdf) • [2](https://unctadstat.unctad.org/CountryProfile/GeneralProfile/en-GB/218/index.html) • [7](https://contenido.bce.fin.ec/documentos/Administracion/EvolEconEcu_2024pers2025.pdf) • [5](https://www.elibrary.imf.org/view/journals/002/2024/357/article-A001-en.xml) Destatis, drawing on IMF World Economic Outlook data, puts GDP at about US$130 billion for 2025 with GDP per capita of US$7,199 nominal and US$16,935 in international (purchasing-power) terms.[13](https://www.destatis.de/EN/Themes/Countries-Regions/International-Statistics/Country-Profiles/ecuador.pdf?__blob=publicationFile&v=16)
## How it compares with Peru, Colombia, and Chile
Ecuador's relative position in the region has slipped markedly. In 1980 its GDP per capita was above Colombia's and Peru's; by 2023 it was 25% below Colombia's, 10% below Peru's, and around 50% below Chile's and [Costa Rica](https://www.edgepedia.org/costa-rica)'s.[10](https://www.imf.org/-/media/files/publications/cr/2024/english/1ecuea2024003-print-pdf.pdf) The gap tracks the growth eras: the strong 1960–1980 period gave way to two decades of 2.9% average growth, a dollarization-era recovery of 3.7% (2001–2014), and then averaged 1.6% from 2014 through 2023.[10](https://www.imf.org/-/media/files/publications/cr/2024/english/1ecuea2024003-print-pdf.pdf)
## Recent developments
**Security crisis.** The national homicide rate rose from 7.7 in 2020 to 44.5 in 2023, among the highest in Latin America, linked to drug cartels operating in the dollarized economy.[6](https://link.springer.com/article/10.1007/s10479-024-06365-y) Presidential candidate Fernando Villavicencio was assassinated on 9 August 2023, eleven days before the general election.[6](https://link.springer.com/article/10.1007/s10479-024-06365-y) In early January 2024 the government declared a 60-day nationwide state of emergency, later extended 30 days, and an internal armed conflict with curfews and mobility restrictions.[9](https://www.imf.org/-/media/files/publications/cr/2024/english/1ecuea2024001.pdf) IMF staff estimate that a 1% increase in the local murder rate is associated with a decline in the level of economic activity of up to 0.5%.[10](https://www.imf.org/-/media/files/publications/cr/2024/english/1ecuea2024003-print-pdf.pdf)
**The Yasuní referendum and oil decline.** The August 2023 referendum banning oil drilling in Yasuní National Park mandated the closure of Block 43-ITT, and the progressive shutdown of its wells, together with insecurity, electoral uncertainty, and the most severe drought in 60 years, drove the 2024 contraction.[7](https://contenido.bce.fin.ec/documentos/Administracion/EvolEconEcu_2024pers2025.pdf) • [1](https://contenido.bce.fin.ec/documentos/informacioneconomica/cuentasnacionales/trimestrales/Informe_CNTIVTrim2024.pdf) The drought also produced nationwide blackouts from late 2023, reappearing in April 2024.[9](https://www.imf.org/-/media/files/publications/cr/2024/english/1ecuea2024001.pdf) By the first half of 2026 oil production had shown operational stabilization, as the critical factors behind the sharp 2025 decline were mitigated.[14](https://ire.finanzas.gob.ec/content/2026/07/IRE_07_26.pdf)
**Fiscal repair.** In 2023 Ecuador completed a USD 1.6 billion debt-for-nature swap, the largest of its kind, reducing the debt stock by USD 1 billion and saving USD 1.5 billion in debt service.[15](https://www.oecd.org/en/publications/latin-american-economic-outlook-2024_c437947f-en/full-report/ecuador_624094b0.html) The IMF approved the 48-month Extended Fund Facility in May 2024 with access of US$4 billion (SDR 3 billion, 430% of quota) and an immediate US$1 billion disbursement; the World Bank describes the program as providing US$5 billion in financing over four years.[9](https://www.imf.org/-/media/files/publications/cr/2024/english/1ecuea2024001.pdf) • [4](https://www.worldbank.org/ext/en/country/ecuador) The program enabled a US$4 billion bond issuance in January 2026, the first international market access since 2019.[4](https://www.worldbank.org/ext/en/country/ecuador) GDP rebounded 3.7% in 2025 and is expected to grow 2.8% in 2026.[4](https://www.worldbank.org/ext/en/country/ecuador)
## China and the resource model
Ecuador's resource model has been shaped by Chinese credit and trade. A month before dropping the Yasuní initiative, the government obtained a US$2 billion loan from the [China Development Bank](https://www.edgepedia.org/china-development-bank) in exchange for nearly 40,000 barrels a day, about 8% of national oil extraction, over two years.[16](https://-sage-cnpereading-com-443.webvpn1.xju.edu.cn/doi/10.1177/0094582X211070831) After 2009 the Correa government bargained with Chinese and Thai oil corporations over credits repaid with oil, Asian companies took a large part of Ecuadorian crude exports, and the state granted multinational corporations an increasing number of mining concessions.[16](https://-sage-cnpereading-com-443.webvpn1.xju.edu.cn/doi/10.1177/0094582X211070831) The model carries a standing conflict: mining and agri-export growth runs against socio-environmental disputes of which the Yasuní referendum, which removed roughly the output of a major field by popular vote, is the clearest expression.[7](https://contenido.bce.fin.ec/documentos/Administracion/EvolEconEcu_2024pers2025.pdf)
## References
1. [Informe de Resultados Cuentas Nacionales Trimestrales, IV Trim 2024 (Banco Central del Ecuador)](https://contenido.bce.fin.ec/documentos/informacioneconomica/cuentasnacionales/trimestrales/Informe_CNTIVTrim2024.pdf)
2. [General profile: Ecuador (UNCTADstat)](https://unctadstat.unctad.org/CountryProfile/GeneralProfile/en-GB/218/index.html)
3. [Twenty years of official dollarization in Ecuador: a blessing or a curse? (AFD)](https://www.afd.fr/sites/default/files/2020-09-04-23-15/official-dollarization-ecuador.pdf)
4. [Ecuador Overview (World Bank)](https://www.worldbank.org/ext/en/country/ecuador)
5. [Ecuador: 2024 Article IV Consultation and First Review Under the EFF (IMF Country Report No. 24/357)](https://www.elibrary.imf.org/view/journals/002/2024/357/article-A001-en.xml)
6. [Dollarization in Ecuador: 2000–2024 (Annals of Operations Research, Springer)](https://link.springer.com/article/10.1007/s10479-024-06365-y)
7. [Informe de evolución de la economía ecuatoriana en 2024 y perspectivas 2025 (Banco Central del Ecuador)](https://contenido.bce.fin.ec/documentos/Administracion/EvolEconEcu_2024pers2025.pdf)
8. [External Shocks on a Dollarized Economy: An Empirical Evidence From Ecuador (BCE working paper)](https://repositorio.bce.ec/bitstream/32000/2344/1/3%20External%20Shocks%20on%20a%20Dollarized%20Economy%20An%20Empirical%20Evidence%20From%20Ecuador.pdf)
9. [Ecuador: Request for an Extended Arrangement Under the EFF (IMF Country Report No. 24/146)](https://www.imf.org/-/media/files/publications/cr/2024/english/1ecuea2024001.pdf)
10. [Ecuador: Selected Issues (IMF Country Report No. 24/358)](https://www.imf.org/-/media/files/publications/cr/2024/english/1ecuea2024003-print-pdf.pdf)
11. [The Monetary and Fiscal History of Ecuador, 1960–2017 (University of Chicago)](https://mafhola.uchicago.edu/wp-content/uploads/Ecuador_Cueva_Diaz.pdf)
12. [Ecuador: Selected Issues, IMF Staff Country Reports 2006/103](https://www.elibrary.imf.org/view/journals/002/2006/103/article-A001-en.xml)
13. [Statistical Country Profile Ecuador (Destatis)](https://www.destatis.de/EN/Themes/Countries-Regions/International-Statistics/Country-Profiles/ecuador.pdf?__blob=publicationFile&v=16)
14. [Informe de Riesgo Ecuador, July 2026 (Ministerio de Economía y Finanzas)](https://ire.finanzas.gob.ec/content/2026/07/IRE_07_26.pdf)
15. [Latin American Economic Outlook 2024 — Ecuador (OECD)](https://www.oecd.org/en/publications/latin-american-economic-outlook-2024_c437947f-en/full-report/ecuador_624094b0.html)
16. [Dependency Revisited: Ecuador's (Re)Insertions into the International Division of Nature (Latin American Perspectives)](https://-sage-cnpereading-com-443.webvpn1.xju.edu.cn/doi/10.1177/0094582X211070831)
---
*Topic: Encyclopedia › Society and history › Economics and business › Economics › Economies and economic history by place › National and regional economies › Economies of South America*
*Initially written Sep 17, 2026 · Reviewed: Sep 30, 2026; Oct 10, 2026 · Edited: Sep 30, 2026; Oct 10, 2026; Oct 11, 2026; Oct 15, 2026; Oct 21, 2026 · Last review: Oct 10, 2026*
*Copyright 2026 EdgeChat AI, a subsidiary of Biostate AI.*
License: Edgepedia Community License 1.0, https://www.edgepedia.org/edgepedia/license