The new President of the Republic, Daniel Noboa Azín, receives the country with 179.7 million dollars in the deposit account of the National Treasury. This was stated in the weekly monetary bulletin of November 17, the latest available from the Central Bank of Ecuador.

This is the lowest balance sheet since mid-2016 and, according to Cordes’ analysis, the figure clearly reflects “the severe fiscal austerity inherited by President Noboa’s government.” And that’s because in the coming days they will have to pay obligations to decentralized autonomous governments (GAD), social security, bonuses for the most vulnerable, and salaries for November and December, including the thirteenth salary.

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Only the monthly cost for wages is about 800 million dollars, while in December the figure rises to 1.3 billion dollars, precisely because of the additional Christmas bonus.

The fiscal situation is complicated, according to Cordes. He explains that tax revenues accumulated three consecutive months of year-on-year decline until September. It was 14% in September.

The decline in tax revenues could worsen starting in January when the foreign exchange outflow tax (ISD) rate is reduced from the current 3.5 percent to 2 percent, Cordes indicated.

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The outlook for oil revenues is also not favorable, not only due to the price drop recorded in recent days, but also due to the reduction that will result from the closure of the ITT oil block. The energy crisis would also represent another important cost.

On this topic, Santiago García, an economic analyst, agrees that the figure clearly shows low liquidity, but explains that the fiscal fund is fed day by day by internal transfers and oil sources. In this sense, there could be resource income in the coming days.

In addition, he comments that in December, which is a month of great commercial activity, more tax funds would come in, for example, from value added tax (VAT).

A never-before-seen -$85 differential is tantamount to a “giveaway” of Ecuadorian crude and shows little interest in the Petroecuador pre-sale

For García, one option for the new government would be to try to sell oil early. However, this has already been attempted in recent days, through an unusual tender, in which the possibility of advance payment remained bottomless, when oil companies offered discounts of up to 85 dollars for an operation of this type.