Agreement signed with Central Bank of Ecuador to simplify and speed up exports

1. PROJECT SUMMARY

General Objective.- The Andean Development Corporation, CAF, and the Central Bank of Ecuador signed an agreement to simplify and speed up export processes, introducing new information technology and the recently enacted Electronic Commerce Act.

The agreement has three objectives: 1) to provide exporters with an export insurance mechanism; 2) to complement the initiative of the Ecuadorian Customs Corporation (CAE) to introduce information technology aimed at simplifying procedures, applying the same strategy to the processing stages outside the customs; and 3) to identify other problems that exporters are experiencing in relation to export procedures.

The result should speed up, simplify and streamline export processes through: 1) the creation and application of an export insurance system; 2) automation of procedures; and 3) the solution of other problems related to export processes.

Export insurance tends to increase exports for several reasons: 1) eliminates some procedures such as letters of credit; 2) allows competition with other countries such as Colombia and Chile, which already have these systems, and are subsidized; 3) speeds up transactions because exporters do not have to carefully evaluate their buyers, and reduces the inherent risks of the activity.

Since the dollarization of the economy, the Central Bank has had two aims: Competitiveness and Strengthening of the Financial System, which it is believed could help sustain dollarization.

The project will form a stable team, based in the Central Bank, to work on problems in export procedures with assistance from the CAF.

The total cost of the project is $140,300, including the CAF contribution of $70,000.