In the midst of continuous political turbulence, there are positive changes that go unnoticed. Progress is the result of many years of continuous and silent work by countless individuals who consciously or unconsciously contribute to the same thing. An example of this is the Ecuadorian trade policy.

The first step was taken at the end of Correa’s government, when the then president implemented a free trade agreement. Fortunately, the end of the commodity boom, including oil, in late 2014 forced the protectionist government to implement the most important trade deal for Ecuador in decades.

Texts and translations are progressing until the trade agreement with China is signed

The free trade agreement with the European Union (EU) increased Ecuadorian exports to the bloc by 53% during the first six years (2017-2022). Ecuadorian consumers and entrepreneurs also benefited, with imports growing by 73.5%. Then, during Lenín Moreno’s administration, the trade agreement with the European Free Trade Area (EFTA) came into force, opening up trade with Switzerland, Norway, Iceland and Liechtenstein. During the Moreno administration, a free trade agreement was signed with the United Kingdom, which entered into force in January 2021.

The current government has opened a priority and this could be, if it continues rapidly and if the Parliament does not stop it, an achievement for the country. A free trade agreement was signed with Costa Rica, an agreement that would allow the inclusion of Ecuadorian products and services, at least indirectly, in global supply chains. The signing of agreements with South Korea, Canada and China is close to completion.

97% of the export supply from Ecuador to Costa Rica will benefit from the trade agreement

(…) Ecuador has been laying the foundations for an open economy for years…

The work carried out by the Ministry of Production, Trade and Fisheries together with private sector unions to improve the competitiveness of the economy is important. The Chamber of Industry of Guayaquil, for example, last year proposed 22 reforms that could improve competitiveness without the need for the Assembly to approve new laws. Since then, restrictions on working hours have been lifted, ARCSA fees have been reduced after product registration, and the costs and time for permits and assessments required by INEN and the Accreditation Service of Ecuador (SAE). This reduces costs, which are especially important for small and medium-sized enterprises, savings that then translate into lower prices and greater choice for consumers.

Of course, all this is difficult to appreciate at a time when the economy has spent years with a mediocre level of growth. It will probably continue to be so due to the complicated international context and the increasingly delicate security situation. Financing on a global level has become more expensive, and on a local level it is still less than it would be if our financial system were integrated with the rest of the world. The tax regime, labor law and financial and business regulations continue to undermine competitiveness. But we must not forget to recognize that with the trade program, Ecuador has been laying the foundations for an open economy for years, encouraging other reforms. (OR)