Business

Ecuador has traditionally been an agrarian country, dependent on agricultural production and exports until the mid 1970's, when the discovery of oil reserves in the Amazon basin triggered a period of rapid economic growth and public spending. In the decade of 1972-1982, the Ecuadorian economy grew at an average rate of 10% annually, allowing the government to invest resources in infrastructure and the development of state enterprises and industries.

In the early 1980's, when the price of petroleum products fell, the government was unable to cut back its expenses and pull out of key economic sectors, accumulating a large foreign debt that led to an economic slowdown and high inflation that continued into 2001.

The El Niño weather pattern hit hard in 1997, damaging vast extensions of productive land, primarily in the Coast region. A subsequent financial crisis emerged, further hampering economic growth. Ecuador is still struggling to overcome its economic crisis, modernizing key sectors of its economy, and opening them to private investment in the hope that these efforts will bring sustainable economic growth.

Agricultural products and petroleum exploitation are the main industries that support the Ecuadorian economy. Ecuador's estimated gross domestic product (GDP) in 1999 reached USD 13.7 billion. The country's working population is nearly 2.2 million people, with the unemployment rate bordering 20%.

The Ecuadorian commercial and industrial sectors are well diversified and managed by the private sector. Ecuador's large industries are small when compared to the ones in the U.K. and the U.S. Industry production is oriented mainly for the domestic market, although recent efforts by regional trade organizations, of which Ecuador is a member, have created more export opportunities for manufacturers. The services sector has been slow to develop, and new business opportunities in tourism and non-traditional product exports are just beginning to increase in importance.

The United States is Ecuador's main trade partner, purchasing 38% of Ecuador's exports, worth USD 1.7 billion, and providing markets for Ecuador's major exports of crude oil, shrimp, bananas, coffee, and cut flowers.