Ecuador makes strides in integration process in trade facilitation and infrastructure

Over the past 30 years, most Latin American countries have implemented trade opening policies, both unilaterally, multilaterally, and as part of regional and extra-regional trade agreements. These policies resulted in reduction of tariffs and non-tariff barriers, thus leading to increases in trade and investment, which on average have been lower than expected.

Ecuador’s performance in this area has matched the region’s in terms of trade openness in the period 1980–2019, in which the percentage of GDP rose from 32% to 44%, in line with the modest performance of the region in general, which went from 52% to 62%. 

These were some of the findings of CAF’s Economy and Development Report (EDR2021), entitled “Pathways to integration: Trade Facilitation, Infrastructure and Global Value Chains” presented in Ecuador with opening remarks by Jorge Arbache, CAF Vice President of the Private Sector, and Julio José Prado, Minister of Foreign Trade, Production, Investment and Fisheries.

“Ecuador is a country with entrepreneurial capacity, talent, natural wealth and potential to integrate economically with the region,” said Arbache, and added that trade and investment are the most suitable channels to attain this goal.  In this connection, he underscored that the report presented by CAF includes broad ideas, but in a practical framework to support public and private policies, with a view to boosting relevant aspects such as productivity, trade, competitiveness, income and job creation in Latin American countries.

Furthermore, Minister Prado emphasized the contribution of CAF’s publication as an input for strategies and actions around the new dynamics that foreign trade is experiencing. He also commented on the work conducted by the Ministry of Foreign Trade, Production, Investment and Fisheries through the Ecuador Compite Strategy, which seeks to prioritize an agenda that boosts the nation’s competitiveness, through three strategic pillars: Productive Ecuador, Global Ecuador, and Ecuador Innovates.

"Although the signing of numerous free trade agreements within Latin America and the Caribbean has helped us eliminate tariffs, which suggests that almost 85% of trade is not subject to these, in the region, as well as in Ecuador, trade showed a moderate increase, mainly explained by a low level of intraregional trade” said Lian Allub, chief economist at CAF’s Socioeconomic Research Directorate and who presented the report during the event.