CEPR.
Outside observers could be forgiven for expecting Ecuador to suffer
terribly during and after the recent global crisis. Two of the
country’s largest sources of foreign earnings, petroleum exports and
remittances from abroad, crashed during the global recession.
Furthermore, lacking its own currency, the government’s options for
responding were limited. But instead of a deep, protracted recession,
Ecuador lost only 1.3 percent of GDP during three quarters of
contraction. After four additional quarters the economy returned to the
pre-recession level of output, and two years after the recession
started, it reached its 20-year growth trend.
This paper takes a detailed look at the fiscal, monetary, and other
economic and social policies implemented during the last five years, as
well as the role of the external sector in the economy. It also
examines economic and social outcomes including levels of poverty,
inequality, and unemployment as well as education and health outcomes
for children.
