The International Monetary Fund (IMF) published the assessment today expost (later) IMF country program approved in September 2020 and concluded in December 2022. This program was implemented during the governments of Lenín Moreno and Guillermo Lasso.

On this topic, the Minister of Economy and Finance, Juan Carlos Vega, put the relevance of the program into context: “When the agreement was approved, in the middle of the pandemic, the Ecuadorian economy was on the verge of collapse. As the IMF assessment report shows, the agreement prevented the economy from falling into a deep economic crisis and strengthened key economic institutions.”

The Secretary of State emphasized the value of the positive assessment: “By successfully concluding the agreement, Ecuador has shown the seriousness of its international obligations.” He also assessed that this IMF report is a good precedent now because “given the delicate fiscal situation inherited by President Noboa’s government, the country once again requires more financing from multilateral credit organizations.”

The report concludes that the re-establishment of macroeconomic stability in the context of a historic economic recession has been achieved. That the authorities strengthened their fiscal reserves, taking advantage of the rise in oil prices. And also that there was progress in matters of tax regulation.

However, the report also states that market access, or access to credit from international markets, has not been re-established due to political uncertainty and major remaining fiscal vulnerabilities, including the high dependence of government revenues on volatile oil prices. This refers to the very high country risk that Ecuador has and as of this Monday the 4th was at 2059 points as of December 3rd. The report also concluded that the extensive technical assistance provided to the authorities helped strengthen capacity in critical areas, particularly tax accounting.

Among the negative points, directors felt that the suspension of fuel subsidy reform after social unrest and the redesign of tax reform during the program hindered the government’s consolidation efforts and allowed vulnerabilities to persist.

But they also note that disbursements have advanced considerably, even though fiscal consolidation has been delayed beyond the duration of the program.

The IMF conducted this evaluation in accordance with its internal policies, which stipulate that when a country receives a program with exceptional access, an evaluation must be conducted. expost program and this must be presented within one year from the termination of the contract. The IMF agreement with the country concluded on December 14, 2022.