Ecuador will grow by 2.8% in 2021, the second worst figure in Latin America

RIO DE JANEIRO, BRAZIL – The Ecuadorian economy will grow by 2.8% in 2021 and 3.5% in 2022, according to the perspectives presented this Tuesday by the International Monetary Fund (IMF).

According to projections, with the sole exception of Venezuela, Ecuador will have the lowest growth this year of all continental Latin America. However, in 2022 it will surpass other countries, such as Uruguay, Brazil, Argentina, and Chile.

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This year’s projection is slightly lower than that of previous reports and those of other organizations, which estimated 3%, which exposes to some extent the devastating effect that the pandemic had last year. It contracted the national economy by 7%.

The Ecuadorian growth has been affected this year by the slowness during the first semester of the vaccination plan against the covid, which did not allow a certain economic reactivation until the third quarter.

On Monday, in a report for the first three quarters of the year, reactivation was reflected in a higher tax collection of almost 11% and a growth of 22% in September, compared to the same periods of 2020.

To boost growth, the Government intended to immediately launch a plan of fiscal and labor reforms under a bill called “Creating Opportunities”, but this has been returned to the Presidency with requests for clarification, which has outraged President Guillermo Lasso.

The Assembly, in which the president is in the minority, has also paralyzed the national budgets for 2021 this week, so the Government must abide by 2020.

The contained projection of Ecuadorian growth contrasts with the average for Latin America, 6.3%, half a point above its July forecast, and even more so with that of countries. One of them is Chile, the Latin American country that will grow at a faster rate. 11%.

Other countries, such as Argentina, Colombia, and Peru, will also advance in 2021 by 7.5%, 7.6%, and 10%, respectively.

The two leading economies of the Latin American continent, Mexico and Brazil, saw their forecast lowered by one-tenth compared to three months ago, to 6.2% and 5.2%, respectively.