Political Risk Advisory Briefing: Ecuador – February 2019

8th February 2019 in
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February 2019’s Political Risk Advisory Briefing from KCS Group Europe focuses on Ecuador.

As Brazil faces an uncertain future with the Trump of the Topics, Argentina is mired in recession and financial downfall, and Venezuela continues to collapse in every social, economic and political metric that man has invented, Ecuador is treading a new and somewhat unique path.

Serious economic and social change is afoot, creating new challenges, opportunities and risks. A country that has, in the past, tended to pass comparatively under the radar, unlike its Latin cousins, Ecuador now seems to be maturing out of the “Pink Tide” of socialism that swept through the continent at the turn of the millennium, whilst others in South America double down.

Evidently, the path will not be smooth sailing. A re-evaluation of old friendships, and rivalries, means that Ecuador is in a state of political and economic evolution. This change of course has made President Lenin Moreno many enemies. The audacity of his policies means that he could well be a one-term President, jeopardising reform in its entirety.

Other problems on the horizon should be of serious concern. Staggering levels of debt and loans structured in a way that gives China access to almost all of Ecuador’s oil for low prices means that, in some ways, China has Ecuador in its pocket. There is also a threat from FARC dissidents who have refused to lay down arms in Colombia and have subsequently crossed the border into Ecuador.

And yet, it is an exciting time to be doing business in Ecuador. New resource and energy concessions are of real interest and reward to foreign companies as Moreno opens the country up to private foreign investment. Companies must, however, move quickly and be aware of the pitfalls and risks associated with Ecuador.

Our report covers the areas of:-

Politics
Economy & Business Environment
Corruption & Freedoms
Criminal Element & Terrorism
Foreign affairs
Conclusion

Based on selected Grey Area Dynamics Ecuador has a possible risk rating of 4.25

To read the full report, please click here

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