Ecuador received a disbursement of USD 500 million from the International Monetary Fund (IMF)the second of a credit program signed in April of this year under the Expanded Service (SAF). This amount is added to the USD 1,000 million delivered in June, totaling USD 1,500 million received during the first year of the government of Daniel Noboa.
The program agreed with the multilateral organization, with a duration of 48 months, has a total value of USD 4,000 million and seeks to support macroeconomic stability and structural reforms in the country.
The most recent disbursement, which dates back to December 24, 2024, is considered key to the economic goals of the current administration. According to the IMF, compliance with the objectives established in the program was decisive for the approval of this second disbursement, as announced by the organization on December 19.
These types of programs with the IMF are not new for Ecuador. This is number 23 in the relationship between both parties.
The agreement signed in April 2024 was negotiated in a context of high economic vulnerabilitymarked by a significant fiscal deficit and the need to strengthen dollarization. The goals included structural reforms and measures to ensure fiscal sustainability, protect social spending and promote economic growth.
According to the government of Noboathe resources from the IMF have been essential to face the immediate financial demands and stabilize the economy. The administration has ensured that disbursements have been used efficiently to meet budget priorities and strengthen confidence in the markets.
Los USD 2.5 billion remainders of the agreement are subject to what happens after the presidential elections scheduled for February 2025. If Noboa achieves re-election, it is expected that the program will be maintained in its current terms. However, in the event of a change of government, it will be the new president who will decide whether to continue with the commitments made or renegotiate the terms with the IMF.
The arrival of these resources occurs in a context of efforts by the government to consolidate economic reactivation and guarantee compliance with its fiscal commitments.
During his first year, Noboa has prioritized attracting investment to generate employment, along with fiscal austerity measures and greater efficiency in the use of public resources, according to official information. However, Ecuador lost more than 100,000 full jobs in one yearaccording to official figures.
However, this credit program has not been without criticism. Opposition sectors have pointed out that agreements with the IMF are usually accompanied by measures that can affect the most vulnerable sectors.
Ecuador has a long history of agreements with the FMImany of which have been controversial due to the associated economic adjustments. However, on this occasion, the government has indicated that the agreed goals are aligned with national priorities, such as protecting dollarization and strengthening the economy.
Periodic reviews of the program will be key to determining the flow of remaining disbursements and to maintaining the confidence of markets and investors.
This year, according to the president Noboathe country’s international reserves almost doubled, going from USD 4,454 million in December 2023 to USD 8,645 million in November 2024. While exports grew by 8.5% until September. Oil revenues increased, reaching nearly USD 154 million in October, an increase of USD 111 million from the previous year.
Internally, local sales between January and November totaled USD 178,455 million and sales during Black Friday grew by 46.9% compared to the same period in 2023. In addition, deposits in private banking increased by USD 6,364 million , reaching USD 50,898 million.
