Household consumption fueled GDP growth of 3.2% in the third quarter of 2022

Household consumption was the main factor that contributed to the Gross Domestic Product (GDP) growing 3.2% year-on-year in the third quarter of 2022, compared to the same period in 2021.

The figure was revealed by the manager of the Central Bank of Ecuador (BCE), Guillermo Avellán, during a press conference offered on Tuesday afternoon in which he detailed the results of the National Accounts.

The quarterly performance of the economy is close to pre-pandemic levels, registered in the same period of 2019, Avellán clarified.

The weight that family spending has had has been important, since it stood at 3.8% year-on-year, reaching the historic amount of $11,807 million in the third quarter of the year that ended. This is a record figure, since it represents 65% of GDP, “thus becoming a fundamental component for the sustained recovery of the Ecuadorian economy,” said the ECB manager and indicated that this behavior has been maintained for the last nine quarters.

Avellán explained that the positive performance of household consumption responds to the increase in consumer loans and remittance flows sent by migrants to the country.

The second factor that contributed to the year-on-year growth of the economy is government spending, which registered 2%. It is explained by the increase in the purchase of goods and services in the health and education sectors, as well as a rise in wages.

And in third place is the gross formation of fixed capital (investments) with 1%, according to the National Accounts.

Regarding exports, a slight growth of 0.1% was reported, driven by shrimp sales. However, compared to the second quarter of 2022, this segment had a slight contraction of 0.1%.

On the other hand, imports fell 0.4% in year-on-year terms due to a decrease in the purchase of refined petroleum oils and chemical products, Avellán described.

Exploring the performance of industries, the ECB report shows that 14 of the 18 industries grew in the third quarter of 2022 relative to the same period in 2021. Aquaculture and shrimp fishing produced the best result with 14.5%, followed by the accommodation and food services sector with 11.8%, electricity and water supply 9.5%, mail and communications 8%, and transport 4.3%.

Guillermo Avellán announced that the outlook for the fourth quarter of 2022 indicates that there will be no increase in GDP. Notwithstanding that, he said that an annual growth of 2.7% is projected. “These are preliminary figures,” he clarified.

Facing 2023, the manager of the Central Bank expressed that the latest forecast for that year is that GDP grows by 3.1%. (YO)