WT/BOP/S/18  
 
27 May 2015  
(15-2744)  Page: 1/34  
Committee on Balance-of -Payments Restrictions   
 
 CONSULTATIONS WITH ECUADOR 
BACKGROUND DOCUMENT BY THE SECRETARIAT 
1.  This document has been prepared in accord ance with paragraph 12 of the Understanding on 
the Balance-of-Payments Provisions of the GATT 1994. 
1  RECENT MACROECONOMIC AND TRADE DEVELOPMENTS  1.1  Real sector and prices 
2.  Ecuador's economy has performed relatively well since 2010 sustained to a large extent by 
higher oil prices and strong domestic demand. Ecuador's economy was moderately affected by the global economic crisis, which caused a slowdown in GDP growth to just 0.6% in 2009. In 2010 and 
2011, the economy improved, with GDP growing at rates well above 5%, aided by strong 
investment and private and public consumption, but also by the performance of the external 
sector. Exports, especially of petroleum products, contributed particularly to growth in 2011 and 2012. The economy slowed down somewhat in 2 012-14, posting growth rates of around 4%. 
Slower growth was partly triggered by lower domestic demand growth, particularly private 
consumption, and, in 2013 by the negative cont ribution of net exports of goods and services 
(Table 1).  
3.  In 2014, real GDP expanded by 3.8%, supported by strong household consumption 
expenditure, and gross capital formation. There was also a slightly positive contribution from net exports, while changes in inventories detracted from growth. Consumption over the last few years has been supported by the Government's genera l monetary stance adopted since 2009, which 
consists in injecting liquidity in the financial sector through a Fund and capping interest rates. 
Reflecting domestic demand strength since 2010, imports of goods and services expanded at an average 6.2% rate between 2010 and 2014. Expo rts of goods and services increased by an 
average annual rate of 3.7% over the same pe riod. Government expenditure has also been a 
strong contributor to growth over the period, incr easing at an average annual rate of 7%. General 
government expenditure growth was particularly solid in 2011-13, but slowed down considerably 
in 2014.  WT/BOP/S/18 
 
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  Table 1 Basic economic indicators, 2009-14 
 2009  2010  2011  2012 2013 2014  
Real sector       
Nominal GDP (current market prices, 
US$ million) 62,520  69,555  79,277  87,623 94,473 100,543  
Real GDP (constant 2007 US$ million) 54,558 56,481 60,925 64,106 67,081 69,632 
Real GDP growth rate (%) 0.6 3.5 7.9 5.2 4.6 3.8 
GDP per capita (US$) 4,242 4,633 5,193 5,645 5,989 6,273 
Population (thousands)a 14,738 15,012 15,266 15,521 15,775 16,027 
Real GDP by expenditure (growth rate, %)  
Final consumption expenditure 0.9 7.2 5.7 4.1 4.0 3.8 
  General government 11.6 4.4 8.7 11.1 7.7 3.6 
  Households -1.0 7.7 5.1 2.7 3.2 3.9 
Gross fixed capital formation -3.6 10.2 14.3 10.6 10.7 3.7 
Changes in inventories -31.3 12.9 -13.3 -75.9 64.3 -11.1 
Exports of goods and services -4.8 -0.2 5.7 4.7 2.4 6.2 
Imports of goods and services -9.9 14.8 3.6 0.8 7.0 5.5 
GDP by industry (% of current GDP)       
Agriculture, livestock, forestry and hunting 8.9 8.7 8.5 7.5 7.8 7.7 
Aquaculture and shrimp 0.4 0.4 0.5 0.5 0.5 0.6 
Fishing, except shrimp 0.6 0.6 0.6 0.7 0.6 0.6 
Mining, quarrying and oil 8.2 10.9 13.2 13.0 12.6 11.9 
Petroleum refining 1.6 1.0 0.8 0.4 0.3 0.1 
Manufacturing (excluding oil refining) 12.3 12.4 12.2 12.3 12.1 12.4 
Electricity and water supply 0.9 1.1 1.2 1.2 1.1 1.3 
Construction 9.5 9.3 10.2 10.8 10.7 10.6 
Wholesale and retail trade 10.4 10.4 10.6 10.3 10.4 10.3 
Accommodation and food services 1.9 1.9 1.8 1.9 2.0 2.1 
Transport 5.7 5.3 4.7 4.4 4.3 4.3 
Mail and communications 2.5 2.4 2.3 2.2 2.1 2.0 
Financial services 2.7 2.8 2.9 3.1 2.8 2.8 
Professional, technical and administrative 
activities 6.0 6.2 6.4 6.5 7.0 7.5 
Education, health and social services 8.3 8.3 7.6 7.9 7.9 7.9 
Public administration 6.8 6.5 6.3 6.3 6.5 6.7 
Domestic services 0.4 0.5 0.4 0.4 0.4 0.4 
Other servicesb 7.4 6.9 6.4 6.1 6.1 6.0 
Other GDP elements 5.6 4.4 3.5 4.6 4.8 4.6 
Central Government operations (US$ million)c 
Total revenue 11,583  15,076  17,198  19,523 20,400 20,240  
  Oil revenue 2,298 4,411 5,971 6,086 4,677 3,624 
   Exports 2,298 4,411 5,971 6,086 4,677 3,624 
  Non-oil revenue 9,285 10,665 11,227 13,437 15,723 16,616 
   Tax revenue 7,257 8,794 9,765 12,255 13,668 14,460 
     Goods and services 3,467 4,416 4,818 6,099 6,800 7,179 
      IVA 3,019 3,886 4,200 5,415 6,056 6,376 
      ICE 448 530 618 685 744 803 
     Income 2,518 2,353 3,030 3,313 3,847 4,161 
     Sales and international trade 923 1,580 1,714 2,536 2,675 2,763 
      Import tariffs 923 1,152 1,156 1,261 1,352 1,357 
      Outside of the countryd 0 428 558 1,275 1,322 1,406 
     Vehicles 118 156 174 194 214 228 
     Other 231 289 28 111 132 129 
   Non-taxes revenue 752 1,512 1,210 1,128 1,961 1,815 
   Transfers 1,276 359 252 54 95 341 
Total expendituree 14,218  16,207  18,435  21,240 25,861 26,793  
  Current expenditure 8,934 9,775 10,399 11,996 14,276 14,981 
   Interest 474 530 673 828 1,169 1,396 
     External 294 306 357 465 652 714 
     Internal 180 224 316 363 516 682 
   Salaries 4,708 6,017 6,466 7,353 7,897 8,359 
   Goods and services 824 1,095 1,279 1,658 2,035 2,491 
   Other 966 843 983 900 1,664 998 
   Transfers 1,962 1,291 998 1,257 1,511 1,737 
  Capital expenditure 5,284 6,432 8,035 9,244 11,586 11,812 
   Gross fixed capital formation 3,507 3,896 5,209 6,191 8,538 8,309 
   Other 0 136 159 328 0 22 
   Transfers 1,777 2,399 2,668 2,724 3,048 3,482 
Overall balance -2,635  -1,131  -1,236  -1,717 -5,461 -6,412  
Overall balance as a % of GDP -4.2 -1.6 -1.6 -2.0 -5.8 -6.4 
Monetary indicators       
M1 (end of period, 12-month change) 3.7 17.0 12.2 20.0 12.1 14.9 
M2 (end of period, 12-month change) 8.2 19.4 19.7 16.4 13.4 14.4 WT/BOP/S/18 
 
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   2009  2010  2011  2012 2013 2014  
Interest rates       
Passive reference rate (year average) 5.4 4.6 4.6 4.5 4.5 4.9 
Reference lending rate (year average) 9.2 9.0 8.3 8.2 8.2 8.1 
Inflation       
Consumer price index (end of period, % 
change) 4.3 3.3 5.4 4.2 2.7 3.7 
Exchange rate       
Real effective exchange rate (2010=100) 102.3 100.0 98.4 102.5 104.7 107.8 
Foreign external debt (billion US$) 13.2 13.9 15.2 15.9 18.7 24.0 
Foreign external debt as share of GDP % 21.1 20.0 19.2 18.2 19.8 23.9 
a Since January 2013, new population data is used, based on official figures for the 1990 to 2010 
period and projections of population from 2010 to 2020, published on the website of the National Institute of Statistics and Census (Instituto  Nacional de Estadística y Censos, INEC) in 
http://www.inec.gob.ec/estadisticas/index.php?option=com_content&view=article&id=329&Itemid=328&lang=es. 
b Includes real estate, entertainmen t, recreation and other services. 
c As of 2010, data correspond to the General State budget, which are not comparable because the 
data include the Autonomous Entities. 
d As of 2010, includes the tax on currencies and other taxes. e Expenses correspond to accrual records. 
Source: Central Bank of Ecuador, Monthly Statistical Bu lletin (various issues); and International Monetary 
Fund, International Financial Statistics. 
4.  Strong domestic demand growth over the 2009-14 has reflected policies to facilitate the 
allocation of credit and keep its cost under control. It has led, to a large extent, to a substantial 
increase in imports, which almost doubled in the case of merchandise trade, during that period. 
The gross capital formation/GDP ratio remained steady, at some 28.5% in 2014. However, in 
general, domestic absorption growth (including imports) has remained high over the period, 
contributing to higher deficits in the current account of the balance of payments.  
5.  From a sectorial point of view, growth has been unevenly distributed across sectors during the 
period. Between 2010 and 2014, the most dynamic productive sectors have been electricity and 
water (expanding at an annual average rate of 15.1% in real terms); construction (11%); 
communications (7.1%); professional services (6 .9%); financial services (5.5%); and mining 
(5.3%), while manufacturing and agriculture increased at lower rates (4.6% and 3.6%, 
respectively), and petroleum refining contracted sharply.  
6.  Ecuador's relatively high growth rates during the 2009-14 period have helped keep the pace of 
employment creation. As a result, Ecuador's unemployment rate is relatively low, at 4.8% at 
end-March 2015. Also, social indicators have improved considerably since 2010.1 Ecuador is 
classified as an upper middle income country: GDP per capita is estimated at US$6,273 in 2014, up from US$4,633 in 2010. 
7.  Inflation has remained moderate since 2009. After accelerating somewhat between 2010 and 
2011, from 3.3% to 5.4%, the increase in the Consumer Price Index (CPI) decelerated in 2012 
and 2013 (4.2% and 2.7%, respectively), but accelerated slightly in 2014 to 3.7%. The CPI increased by 3.8% in the 12-months until end-March 2015.
2 The recent appreciation of the 
U.S. dollar is likely to contribute to maintain inflation subdued over the near future. 
1.2  Fiscal accounts 8.  Fiscal policy is the main tool for macroeconomic adjustment given that the dollarization of the 
economy leaves limited scope for any monetary policy initiative. The main fiscal policy objectives 
as stated in the Four Year Budget Programme 2012-15 are to promote income redistribution and boost economic activity, and its main tools are the use of incomes policies, expenditure management and public sector financing. The incomes policy underpinning the medium-term fiscal 
scenario is associated with the strengthening of tax and tariff management. With respect to the 
latter point, the authorities have sought the implementation of "a tariff policy that provides 
                                               
1 World Bank online information. Viewed at : http://data.worldbank.org/country/ecuador. 
2 Central Bank of Ecuador online information. Viewed at: 
http://www.bce.fin.ec/index.php/component/k2/item/754. WT/BOP/S/18 
 
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  adequate and proper protection to the national productive sectors".3 The Budget Programme also 
calls for the use of tax incentives to promote the development of productive activities. Public expenditure policy is geared firstly to maintain and expand the coverage of public services and 
secondly to strengthen public investment in projects and programmes in strategic sectors 
(petroleum, electricity, etc.) and in social and infrastructure projects. 
9.  The Constitution mandates that the State maintain a disciplined fiscal policy. The reforms 
introduced by the Fiscal Responsibility, Stabilizati on and Transparency Law (Law No. 72, Official 
Journal of 4 June 2002), set fiscal deficit limits: annual growth of primary central government 
expenditure must not exceed 3.5% in real terms (excluding capital spending); and the fiscal deficit as a percentage of GDP (excluding oil export revenue) must decrease by 0.2% each year. The Law also sets a public debt limit of 40% of GDP. However, in practice these goals have not been met, 
as expenditure growth has been high, particularly capital spending and remunerations. 
Expenditure increased by almost 90% between 2009  and 2014 in U.S. dollar terms, equivalent to 
an annual average rate growth of some 13.5%, hi gher than the average annual growth rate of 
nominal GDP (10%). Spending continues to remain relatively inflexible despite the fact that the 
practice of earmarking tax re venue to different areas and levels of Government has been 
discouraged.
4  
10.  Between 2009 and 2014, Central Government  revenue increased at a nominal average annual 
rate of 11.8%, below the rate of increase in ex penditure. Revenue grew steadily up to 2013, but 
declined somewhat in 2014, mainly on account of a sharp contraction in oil-related revenue, which in 2014 was some 40% below its peak in 2012. In contrast, non-oil revenue grew steadily through 
the 2009-14 period, at an average annual rate of 12.3%. In this area, Ecuador relies considerably 
on taxes on international trade, which amounted  to US$3.66 billion in 2014, some 3.6% of GDP or 
18.3% of Central Government Revenue, including th e corresponding portions of the VAT or the ICE 
on imports. Of this total, tariff revenue amounted to 1.3% of GDP, or 6.4% of Central Government 
Revenue.  
11.  Ecuador has run a fiscal deficit in every year during 2009-14. The Central Government deficit 
declined to 1.6% of GDP in 2010 and 2011, years of faster economic growth. The fiscal situation 
has deteriorated since then mainly as a result of decreasing oil revenues amidst continued expenditure growth: the deficit peaked at some 6. 4% of GDP in 2014. Despite the increase in the 
traditional non-financial sector public enterprises' surplus, the non-financial public sector (NFPS) 
deficit increased from 0.9% of GDP in 2012 to 4.6% of GDP in 2013 and 5.3% in 2014 (Table A1). 
12.  Fiscal deficits have complicated the balance-of -payments situation in recent years, both from 
the current account and capital and financial accounts sides. From the current account point of 
view, the deficit has triggered an increase in im ported goods and services to meet the public 
sector increasing investment and other expenditure needs. From the capital account side, it has resulted in an increasing reliance on foreign loans, particularly in 2013 and 2014, to finance the 
deficits in the current account and income balances (Table A2). 
13.  The public sector's consolidated debt reached US$31.7 billion at end-March 2015, or 29.2% of 
GDP. Of this, US$19.1 billion (17. 6% of GDP) was external debt and US$12.6 billion (11.6% of 
GDP) was domestic debt. This is a substantial increase with respect to the situation of just 
twelve months earlier, since at end-March 2014, total public debt had reached US$23.8 billion, or 
23.6% of GDP, of which US$12.9 billion (12.8% of GDP) were foreign debt and US$10.9 billion (10.8% of GDP) domestic debt.
5 
                                               
3 Ministerio de Finanzas (2012), Programación Pr esupuestaria Cuatrianual 2012-2015, p.12. Viewed at: 
http://www.finanzas.gob.ec/wp-content/uploads/downloads/2012/08/PROG RAMACION_PRESUPUESTARIA_2012-2015.pdf. 
4 Ministerio de Finanzas (2012), Programación Presupuestaria Cuatrianual 2012-2015. Viewed at: 
http://www.finanzas.gob.ec/wp-
content/uploads/downloads/2012/08/PROG RAMACION_PRESUPUESTARIA_2012-2015.pdf. 
5 Ministry of Finance online information.  Viewed at: http://www.finanzas.gob.ec/wp-
content/uploads/downloads/2015/04/ESTA_MARZO-2015_CONSOLIDADO.pdf. WT/BOP/S/18 
 
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  1.3  Monetary and exchange rate policy 
14.  The 2008 Constitution eliminated the Central Bank of Ecuador's (CBE) autonomy and 
transferred to the Executive the responsibility for the formulation of monetary, credit, foreign 
exchange and financial policies. These policie s are implemented through the CBE. The 2009 Ley 
Reformatoria de la Ley de Régimen Monetario y Banco del Estado  established that Bank's Board be 
composed wholly of government officials. It was also decided to invest domestically a portion of the Banks's free availability reserve resources, es pecially in the generation of credit lines to 
productive sectors considered strategic for national development.
6 
15.  The U.S. dollar has been the currency of legal tender in Ecuador since March 2000. Reflecting 
this, the Central Bank does not act as lender of last resort and cannot conduct an active and independent monetary policy being a fully dollarized economy. This has implications for Ecuador, 
since it limits its ability to respond to external  risks. Through its use of the U.S. dollar, the 
Ecuadorian economy absorbs the effect of currenc y fluctuations which may not be necessarily in 
harmony with its own economic cycle. On the other hand, dollarization has played an important 
role in securing macroeconomic stability.
7 Although there has been a real effective appreciation of 
some 6.7% between 2010 and end-2014, the IMF staff considers that Ecuador's real effective exchange rate appears to be broadly in line with medium-term fundamentals as of end-2013.
8 To 
partly offset the lack of a lender of last resort, the authorities established a Liquidity Fund (Fondo 
de Liquidez), which is a commercial investment trust, created and established to serve the liquidity needs of private financial institutions subject to reserve requirements. There are also minimum 
liquidity requirements (Reservas Mínimas de Liquidez) that banks have to meet. 
16.  The Central Bank' basic interest rate has been kept at 0.2% since January 2010, when it was 
lowered from 5.1% adopted in 2009 in the context of the global financial crisis.
9 Also, since 
July 2008, the Central Bank has been regulating lending interest rates, establishing interest rate 
ceilings for commercial, consumer, housing and micro-credits. As a result, lending interest rates 
have remained broadly stable since 2010, with the reference lending rate averaging 8.1% in 2014, a similar level than in the previous two years. However, this may have discouraged competition 
among banks. In this respect, in the context of Ecuador's July 2014 Article IV consultations with 
the IMF, the Fund's Board recommended a gradual lifting of interest rate caps and greater competition in the determination of interest rates.
10 
1.4  Balance of Payments  
17.  After posting a deficit equivalent to 2.3% of GDP in 2010, Ecuador's current account of the 
balance of payments showed moderate deficits in  2011 and 2012. In 2013, the deficit increased to 
US$984.2 million, equivalent to 1% of GDP (Table 2) on account of deteriorating merchandise and 
services trade balances, particularly due to an in crease in imports. In 2014, the deficit moderated 
to some US$601.7 million or 0.6% of GDP on account of a faster increase in exports of goods compared to imports. Also, there was contraction in the services account deficit, due primarily to 
an increase in receipts for the exportation of services.
11 This was countered, however, by 
deterioration in the income balance and lower net transfers. The capital and financial account has posted a surplus during every year between 20 10 and 2014, with the exception of 2012. This 
reflects an increasing resort to external financing as witnessed by the increase in the foreign debt 
over the period (see below). 
                                               
6 Central Bank of Ecuador (2012), ABC del BCE . Viewed at: 
http://contenido.bce.fin.ec/documentos/PublicacionesNotas/Catalogo/Memoria/2008/abc-web.pdf. 
7 IMF (2014), IMF Executive Board Concludes 2014 Articl e IV Consultation with Ecuador. Press Release 
No. 14/393, 20 August 2014. Viewed at: http://www.imf.org/external/np/sec/pr/2014/pr14393.htm. 
8 IMF (2014), IMF Executive Board Concludes 2014 Articl e IV Consultation with Ecuador. Press Release 
No. 14/393, 20 August 2014. Viewed at: http://www.imf.org/external/np/sec/pr/2014/pr14393.htm. 
9 Central Bank of Ecuador online information. Viewed at: 
http://contenido.bce.fin.ec/docs.php?path=/home1/economia/tasas/TasaBasica.xls. 
10 IMF (2014), IMF Executive Board Concludes 2014 Articl e IV Consultation with Ecuador. Press Release 
No. 14/393, 20 August 2014. Viewed at: http://www.imf.org/external/np/sec/pr/2014/pr14393.htm. 
11 Central Bank of Ecuador online information. Viewed at: 
http://contenido.bce.fin.ec/documentos/Estadisticas/ SectorExterno/BalanzaPagos /boletin50/1_BdPNormalizada
.xls. WT/BOP/S/18 
 
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  18.  According to balance-of-payments data, merchandise exports rose by 3.6% in 2014, to 
US$26.1 billion, due to 15.7% incr ease in exports of non-petroleum products and despite a 
decrease in petroleum exports.12 Merchandise imports increased by 1.9% to US$26.7 billion in 
2014. There was a small decline in imports of consumption goods.  
19.  Ecuador traditionally runs a large services balance deficit due mainly to its deficit in 
transportation and some other services. This structural deficit has generally been in the range of 1.2%-2% of GDP and has been one of the factor s leading to the posting of a current account 
deficit, since it has not been offset by the fluctuating merchandise trade balance. In 2014, there 
was an important increase in travel receipts, which helped lower somewhat the traditional services balance deficit from US$1,495.3 million in 2013, to US$1,219.3 million in 2014 (Table 2).  
Table 2 Balance of Payments, 2009-14 
(US$ million) 
 2009  2010  2011  2012  2013 2014a 
Current account 204.3  -1,606.8  -260.1  -163.8  -984.2 -601.7  
Current account balance as % of 
GDP 0.3 -2.3 -0.3 -0.2 -1.0 -0.6 
  Merchandise Balance 143.6  -1,504.0  -160.3  49.9 -492.5 -67.2  
   Exports 14,412.0 18,137.1 23,082.3 24,568.9 25,685.7 26,604.5 
     Merchandise 14,126.6 17,766.4 22,612.4 24,069.0 25,167.0 26,067.1 
      Petroleum and derivatives 6,964.6 9,673.2 12,944.9 13,792.0 14,107.7 13,302.5 
      Non-petroleum exports 6,898.4 7,816.7 9,377.5 9,972.8 10,740.1 12,429.8 
      Unregistered trade 263.5 276.5 290.0 304.2 319.2 334.8 
     Other exports 285.4 370.7 470.0 499.9 518.7 537.4 
       
   Imports -14,268.4 -19,641.1 -23,242.6 -24,518.9 -26,178.2 -26,671.7 
     Merchandise -14,245.6 -19,618.3 -23,219.8 -24,496.1 -26,155.4 -26,648.9 
      Consumption goods -3,119.5 -4,306.4 -4,806.7 -5,012.9 -5,292.5 -5,258.4 
      Other goods -10,977.4 -15,162.2 -18,202.9 -19,192.5 -20,596.3 -21,200.8 
      Unregistered trade -148.7 -149.6 -210.3 -290.8 -266.6 -189.6 
     Other imports -22.8 -22.8 -22.8 -22.8 -22.8 -22.8 
       
  Services Balance -1,281.8  -1,522.4  -1,562.7  -1,391.1  -1,495.3 -1,219.3  
   Receipts 1,336.5 1,472.2 1,587.5 1,807.2 2,029.0 2,333.9 
     Transport 345.5 359.8 398.9 411.9 423.5 424.7 
     Travel 670.1 781.3 843.4 1,032.5 1,246.2 1,482.1 
     Other services 320.9 331.1 345.2 362.8 359.4 427.1 
   Payments -2,618.3 -2,994.7 -3,150.2 -3,198.4 -3,524.3 -3,553.2 
     Transport -1,369.2 -1,716.2 -1,761.7 -1,708.4 -1,773.4 -1,782.7 
     Travel -548.7 -568.1 -593.7 -610.6 -621.4 -632.4 
     Other services -700.5 -710.4 -794.9 -879.4 -1,129.5 -1,138.1 
       
  Income -1,372.8  -1,038.8  -1,259.5  -1,302.7  -1,395.2 -1,579.3  
   Receipts 106.3 77.7 84.5 105.3 112.6 118.0 
   Payments -1,479.1 -1,116.5 -1,344.0 -1,408.1 -1,507.8 -1,697.3 
     Remuneration of employees -6.4 -6.9 -7.6 -8.4 -9.8 -11.4 
     Direct investment income -838.2 -546.9 -700.9 -675.6 -683.9 -665.9 
     Portfolio investment income -65.5 -64.3 -61.5 -64.0 -63.7 -143.2 
     Other investment income -569.0 -498.5 -573.9 -660.0 -750.4 -876.7 
       
  Current transfers 2,715.4  2,458.4  2,722.4  2,480.2  2,398.8 2,264.1  
   Remittances 2,735.5 2,591.5 2,672.4 2,466.9 2,449.5 2,461.7 
   Other transfers (inflows) 291.3 313.6 312.3 289.7 253.0 265.2 
   Other transfers (outflows) -311.5 -446.7 -262.3 -276.4 -303.7 -462.9 
       
Capital and financial account -2,725.6  294.8  453.2  -515.6  2,959.8 394.3  
                                               
12 Central Bank of Ecuador online information. Viewed at: 
http://contenido.bce.fin.ec/documentos/Estadisticas/ SectorExterno/BalanzaPagos /boletin50/1_BdPNormalizada
.xls. WT/BOP/S/18 
 
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   2009  2010  2011  2012  2013 2014a 
       
  Capital account 76.3  78.8 82.3 121.5  66.1 66.8  
  Financial account -2,801.9  216.1  370.9  -637.1  2,893.6 327.6  
   Direct investment 306.3 163.0 643.8 584.9 730.9 773.9 
   Portfolio investment -3,141.5 -731.1 41.0 66.7 -909.8 1,500.4 
   Other investment 33.3 784.1 -313.9 -1,288.7 3,072.6 -1,946.7 
       
Errors and omissions -125.9  99.7 78.8 97.4 -129.6 -217.1  
Global balance of payments -2,647.2  -1,212.3  272.0  -581.9  1,845.9 -424.5  
Financing 2,647.2  1,212.3  -272.0  581.9  -1,845.9 424.5  
  Reserves 681.0 1,170.0 -335.6 475.1 -1,878.0 411.5 
  Exceptional financing 1,966.2 42.3 63.6 106.8 32.1 13.0 
a Provisional data. 
Source: Central Bank of Ecuador. 
20.  Ecuador's current account presents some specific structural characteristics: apart from the 
traditional deficit in the services balance, there is also a substantial deficit in the income balance and a strong reliance on current transfers, in particular remittances. The deficit in the income 
balance stems mainly from payments related to direct and other investment in Ecuador, linked to a 
large extent to the petroleum sector and to mining activities. The deficit in the income balance increased gradually between 2010 and 2013 and ro se more sharply, to US$1.6 billion in 2014 
(compared with US$1.4 billion in 2013), equivalent to 1.6% of GDP, due to higher dividend and 
royalty payments for foreign direct investment. The surplus in transfers peaked in 2011, when they reached US$2.7 billion or 3.9% of GDP. Tran sfers declined somewhat in the following years 
totalling some US$2.3 billion, or  2.2% of GDP in 2014 (remittanc es reached US$2.5 billion in the 
same year). Transfers, especially remittances, are an important source of financing for Ecuador's 
other parts of the current account; in particular, they contribute to cover the deficit in the (merchandise and service) trade balance. They also provide an important support to domestic 
demand, especially private consumption, although not to the same extent than in other countries 
in Latin America. 
21.  The capital and financial account deficit registered in 2009 (US$2.7 billion) was caused 
primarily by portfolio investment outflows in the midst of the global financial crisis. This situation 
was reversed in 2010 and 2011 when the capital and financial account was in surplus due to FDI inflows and an increasing reliance in foreign loans, which more than doubled between 2010 and 2011. The boost in petroleum exports in 2012, made it less necessary to resort to foreign 
financing to finance the small current account deficit. However, this situation was reversed in 2013 
and 2014, when loans of US$2.77 billion and US$2.57 billion, respectively, were necessary to 
finance the current account deficit (Table A2). 
22.  After increasing in 2011, international rese rves declined considerably in 2012 despite an 
increase in exports. This reflected especially the decline in current transfers. Ecuador resorted to foreign loans and other types of financing to b oost international reserves in 2013, when they 
peaked at US$4.36 billion. By end-2014, however, this level had declined to US$3.95 billion. The 
decline continued in the first three months of 2015 (Table 3). As of 31 March 2015, international reserves had declined to US$3.67 billion, covering just 1.5 months of future imports of goods and 
services. Ecuador's reserve coverage of import has been traditionally low since 2009; coverage has 
never exceeded 1.9 months (in 2009 and 2012) and has been as low as 1.2 months (in 2011).  
Table 3 International reserves (end of period), 2010-15 
(US$ million) 
 2010 2011 2012 2013 2014 March 
2015 
1. Net foreign exchange position 
(1.1+1.2+1.3) 1,387.3 1,597.6 469.2 3,088.2 3,237.4 3,072.5 
 1.1 Cash 519.2 649.3 244.2 360.4 361.0 429.7 
 1.2 Net deposits in banks and 
financial institutions abroad 504.5 295.4 225.0 1,428.7 1,193.1 695.3 WT/BOP/S/18 
 
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   2010 2011 2012 2013 2014 March 
2015 
 1.3 Investments,  term deposits 
and securities  363.6 652.9 0.0 1,299.1 1,683.3 1,947.6 
2. Gold 1,187.3 1,293.3 1,402.6 1,023.5 464.9 457.9 
3. SDRs 24.9 23.1 24.2 27.9 25.9 24.6 
4. IMF reserve position 26.4 43.8 43.8 43.9 41.3 39.4 
5. LAIA position  -3.8 -0.2 2.2 0.3 -21.0 2.2  
6.SUCRE positiona     540.5 176.7 200.5 71.1 
International Reserves 
(1+2+3+4+5+6) 2,622.1 2,957.6 2,482.5 4,360.5 3,949.1 3,667.7 
Months of imports of goods and 
services covered 1.9 1.6 1.2 1.9 1.6 1.4 
a The total amount of exports le ss imports performed by Ecuador through the Single System of 
Regional Compensation (Sistema Único de Compensación Regional, Sucre) is included in the Free Availability International Reserve account (Reserva Internacional de Libre Disponibilidad, RILD) since2013. The decision was made by the Board of Directors of the Central Bank of Ecuador (BCE) in Resolution DBCE-046-SUCRE, of 29 December 2012. 
Source: Ecuador's Central Bank on line information. Viewed at: 
http://contenido.bce.fin.ec/documentos/Publica cionesNotas/Catalogo/Coyuntura/s731/BMS_240420
15.xls . 
23.  After declining as a share of GDP between 2009 and 2012 (from 21.1% to 18.2%), total 
external debt increased to some 23.9% of GDP by end-2014 (some US$24 billion). Although this 
ratio is relatively low, it has been increasing fast recently: just in 2014, it rose by 4.1 points of GDP. 
2  RELATIONS WITH THE IMF 
24.  Between 2009 and early 2014, Ecuador did not hold any Article IV consultations with the IMF. 
At the time of drafting this report, Ecuador had concluded its latest Article IV consultations in July 2014. Ecuador is scheduled to hold consultations again in 2015.  
25.  In the context of the 2014 Article IV consultations, the IMF staff noted that Ecuador had made 
significant economic and social progress over the last decade; growth had averaged 4.5% annually 
since 2001, and inflation had gradually declined to around 3% a year. Financial stability, achieved 
with dollarization, had been preserved and together with low inflation, sustained growth, and 
higher social spending, helped reduce poverty and improve social indicators. High oil prices in the 
last several years had generated a windfall income that had supported the balance of payments 
and fiscal accounts, facilitating higher public spending.  
26.  The IMF's Executive Board agreed with most of the staff appraisal, welcomed the authorities' 
reengagement with the Fund through the Article IV consultation and commended the significant 
improvements in Ecuador's social and economic in dicators over the past decade. They noted that 
Ecuador's growth prospects were generally favourable and risks were broadly balanced. However, 
they cautioned against a potentially less favourable external environment, which in the context of dollarization and limited policy flexibility could complicate macroeconomic management, and called 
on the authorities to continue to strengthen the financial system, and pursue further reforms to 
boost competitiveness and sustain high growth. The Board welcomed the authorities' intention to moderate current spending and prioritize capita l expenditure to accommodate large planned and 
ongoing public investments, but emphasized the need to create additional fiscal space. They 
recommended a carefully planned overhaul of fuel subsidies and improving revenue collection further. The Board also recommended the deepening of structural reforms to raise productivity and 
sustain economic growth, including efforts to impr ove the business climate, increase labour market 
flexibility, upgrade human capital, and strengthen institutions and the legal framework.
13 
                                               
13 IMF (2014), IMF Executive Board Concludes 2014 Articl e IV Consultation with Ecuador. Press Release 
No. 14/393, 20 August 2014. Viewed at: http://www.imf.org/external/np/sec/pr/2014/pr14393.htm. WT/BOP/S/18 
 
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  3  DEVELOPMENTS IN TRADE 
27.  According to the information provided by the authorities and data from COMTRADE (which 
may differ from BOP data), Ecuador's merchandise exports (f.o.b.) in 2014 totalled US$25.7 billion
14, a 3.1% increase compared to 2013, while merchandise imports (c.i.f.) reached 
US$27.5 billion in 201415, a 1.7% increase. 
3.1  Composition of Trade 28.  Mineral products, in particular petroleum, are Ecuador's main export goods, accounting for 
some 52.6% of total exports in 2014, down from 56.9% in the previous year.
16 This reflects to a 
large extent a decline in the value of petroleum exports, triggered mainly by lower prices. Agricultural products are the second largest export category. Exports of vegetable products and live animals and animal products accounted for 25% of total exports in 2014, some three 
percentage points higher than in the previous ye ar. Exports of prepared foodstuffs and beverage 
remained relatively stable, at 10.5% of total exports in 2014.  
29.  Over two-thirds of Ecuador's imports are manufactured goods. The main import categories in 
2014 were machinery and appliances (21.5% of the total) chemicals (12%), and automotive 
products (8.6%). Imports of mineral products, mainly  refined oil, make up for almost 25% of total 
imports, while the rest are imports of agricultural products. The high share of mineral imports in 
total imports is explained by the fact that, although it is a major oil producer, Ecuador has 
insufficient refining capacity to meet domestic demand for refined products and must import many oil derivatives. Ecuador is largely dependent on imports of diesel, gasoline, and cooking gas. 
30.  Chart 1 shows the product composition of merchandise trade by HS Section. 
                                               
14 The figure for 2013 was US$25 billion. 
15 The corresponding figure for 2013 was US$27.1 billion. 
16 COMTRADE figures using SITC classification. WT/BOP/S/18 
 
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  Chart 1 Product composition of merchandise trade by HS Section, 2013 and 2014 
 
Source: WTO Secretariat estimates, based on UNSD Comt rade database and data provided by the authorities 
for the year 2014. 
3.2  Geographical distribution of trade 
31.  Ecuador's merchandise exports are mainly directed to trading partners in the Americas, which 
combined account for almost three quarters of total market share. The main single destination for Ecuador's exports is the United States, which accounted for 43.8% of total exports in 2014, 
followed by the EU (28), accounting for 11.6% of  the total, Chile (8.9%), Peru (6.1%), Panama 
(5.5%), and Colombia (3.7%) (Chart 2). The geographical distribution of Ecuador's exports has not changed much between 2009 and 2014. WT/BOP/S/18 
 
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  32.  Ecuador's merchandise imports also have their origin mainly in trading partners in the 
Americas, which accounted for 62.5% of total imports in 2014, up from 56.9% in 2013. The main sources of imports in 2014 were the United States (31.9% of the total), China (13%), the EU (28) (11%), Colombia (8%), Panama (5.1%) and Peru (3.7%). In 2014 the America's share of 
Ecuador's imports increased, while China's share decreased. 
Chart 2 Direction of merchandise trade, 2013 and 2014 
 
Source: WTO Secretariat, based on data from UNSD  Comtrade database, and data provided by the 
authorities for the year 2014. WT/BOP/S/18 
 
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  4  TRADE POLICY FEATURES AND DEVELOPMENTS 
4.1  Trade Policy Framework 33.  Ecuador has been a WTO Member since 21 January 1996. Ecuador has not signed the 
Agreement on Information Technology nor does it participate in the WTO Agreement on 
Government Procurement. Since its accession, Ecuador has participated in three disputes as 
complainant
17, three as respondent18, and 27 as third party.  Ecuador participates actively in the 
negotiations of the Doha Development Agenda (DDA). It has presented submissions in various 
areas, including trade facilitation, market access for non-agricultural products, agriculture, regional 
trade agreements, fisheries subsidies, and biological diversity. Ecuador's trade and investment policies have been reviewed twice in the Trade Poli cy review Body. The last review took place in 
November 2011.
19 The Committee on Balance-of-Payments Restrictions held consultations with 
Ecuador in 2009 with respect to trade measures for balance-of-payments reasons.20 
34.  In January 2009, Ecuador imposed one-year trade measures for balance of payments 
purposes, including both price-based measures (tar iff increases) and quantitative restrictions to 
imports, to 630 tariff lines at the ten-digit level, i.e. 8.7% of a total of 7,230 tariff lines.21 In 
February 2009, Ecuador notified these measures to the Committee on Balance ‑of‑Payments 
Restrictions, under Article XVIII:B of th e GATT 1994 and the Understanding on the 
Balance ‑of‑Payments Provisions of the GATT 1994.22 The measures affected mainly some durable 
and non-durable consumer goods and transport equipment as well as textile and clothing products, 
and footwear; they were applied on imports from all trading partners.  
35.  The Committee on Balance-of-Payments Restrictions held consultations with Ecuador in April 
and June 2009 (and later in September and October of the same year). The IMF participated in the 
consultations. As a result of the consultations, a Committee report was agreed in which Ecuador 
committed to replace most of the quantitative restrictions for price-based measures no later than 1 September 2009 and to eliminate all the measures by 22 January 2010.
23 However, the 
measures were not dismantled on 22 January 201 0, but were extended for another six months, 
subject to a gradual schedule of reductions.24 In July 2010, Ecuador notified to the Committee that 
the measures had been eliminated on 23 July 2010.25 
36.  The Foreign Trade and Investment Council (COMEX), a body where the Ministries in charge of 
foreign trade policy, agricultural policy, industrial policy, and public finances as well as the Internal 
Revenue Service, the customs authority, and the National Secretariat of Planning and 
Development (SENPLADES) participate, is responsible for the formulation of Ecuador's trade policy 
and for the approval of specific trade policy measures.26  
                                               
17 Dispute DS27 European Communit ies — Regime for the Importation, Sale and Distribution of 
Bananas; Dispute DS237 Turkey — Certain Import Procedures for Fresh Fruit; and Dispute DS335 United States — Anti-Dumping Measure on Shrimp from Ecuador. All cases are now closed. Viewed at: 
http://www.wto.org/english/thewto_e/countries_e/ecuador_e.htm.  
18 Dispute DS182 Ecuador — Provisional Anti-Dumping Measure on Cement from Mexico; Dispute DS191 
Ecuador — Definitive Anti-Dumping Measure on Cement from Mexico; and Dispute DS303 Ecuador — Definitive 
Safeguard Measure on Imports of Medium Density FibreboardDS468 Ukraine — Definitive Safeguard Measures on Certain Passenger Cars. None of the three cases went beyond the consultations phase. Viewed at: 
http://www.wto.org/english/thewto_e/countries_e/ecuador_e.htm. 
19 The record of the meeting is contained in WT O documents WT/TPR/M/254/Add.1, 9 January 2012 and 
WT/TPR/M/254/Add.2, 26 January 2012. 
20 The reports for the meetings held  by the Committee to review Ecua dor's measures are included in 
WTO documents WT/BOP/N/91, 11 June 2009; WT/BOP/R/94, 2 October 2009; WT/BOP/R/97, 6 November 2009; and WT/BOP/R/100, 23 August 2010. 
21 The measures consisted of: (a) ad valorem  tariff increases, in some cases from bound levels and in 
others from applied levels, of 30 and 35%, in terms for 75 subheadings; (b) introduction  of specific tariffs for 
284 subheadings to be added to bound ad-valorem levels; (c) quantitative restrictions of 65 and 70% of the CIF value of imports in 2008 for 23 and 248 subheadings respectively. 
22 WTO document WT/BOP/N/65, 23 February 2009. 
23 WTO document  WT/BOP/N/91, 11 June 2009. 
24 WTO document WT/BOP/N/74, 19 February 2010. 
25 WTO document WT/BOP/N/77, 27 July 2010. 
26 COMEX online information. Viewed at: http://www.comercioexterior.gob.ec/comex/. WT/BOP/S/18 
 
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  37.  The Foreign Trade and Investment Law (Law No. 46, Official Journal of 19 December 1997), 
contains the main guidelines with respect to trade policy, which is identified as a national priority. The Law provides the main guidelines with respect to trade policy, namely: the promotion of export growth and diversification; export and import facilitation; the promotion of international 
competitiveness in an environment of fair and equitable trade practices; and participation in 
regional integration as well as multilateral agreements. 
38.  Ecuador is a member of the Andean Community, together with the Plurinational State of 
Bolivia, Colombia, and Peru. Although the Cart agena Agreement calls for the formulation of a 
common trade policy among member countries, this goal has not been yet achieved, and trade policy decisions continue to be taken mainly at the national level. The Andean Community's customs union has yet to be completed, as well as the full application of a common external tariff. 
However, there are common Andean rules covering a number of areas, including customs 
procedures, technical regulations, contingency measures and intellectual property. 
39.  Ecuador maintains a number of preferential tr ade agreements under the umbrella of the Latin 
American Integration Association (LAIA). Ecuador has such agreements with Chile, Cuba, the 
MERCOSUR member countries, Guatemala and Mexico. The agreement with Chile (Economic 
Complementarity Agreement No. 65 of 10 March 2008, which replaced Economic Complementarity 
Agreement No. 32 of 1994), in effect since January 2010, is comprehensive, and has resulted in 
the elimination of tariffs on some 96.6% of tariff lines; the exception being around 230 mainly agricultural products. Ecuador together with Colombia and Venezuela, and the MERCOSUR countries put in place a 15-year tariff reduction chronogram with the aim of establishing a free 
trade area, as specified in the Economic Complementarity Agreement No. 59 of 18 October 2004, 
in effect for Ecuador since March 2005. Under the agreements with Cuba (Economic Complementarity Agreement No. 46 of 10 May 2000) and Mexico (Partial-Scope Renegotiation 
Agreement No. 29 of 30 April 1983) tariff preferences are granted on a limited number of 
products. The partial-scope agreement with Guatemala entered into force in February 2013.  
40.  In 2010 Ecuador replaced its free-zones and maquila scheme by the special economic 
development zones (ZEDE) regime, introduced by  the December 2010 Organic Code of Production, 
Trade and Investment. However, free zones whose concessions have been granted under the aegis of the Free Zones Act will continue operation under the conditions in force at the time of approval, for the term lasting their concession. ZEDE have the objective of promoting production for export, 
as well as fostering territorial development, and creating quality employment. The ZEDE are 
customs areas, and must be installed in delimited  geographical areas of the country. They aim at 
attracting new investments by offering tax incentives and streamlined customs processes. An 
enterprise operating in a ZEDE may claim a tax credit for value-added taxes paid in the acquisition 
of commodities, goods, and services to be used in production processes in the zone. It may also import duty-free goods and services related to their businesses at the ZEDE. 
41.  A general policy for the establishment of ZEDE was approved in April 2014: it aims at 
promoting the establishment of ZEDE in parts of the country defined as priority areas, as well as at 
diversifying the supply of goods and services in se ctors with growth potential. Another policy goal 
is to promote the use of domestic suppliers in the ZEDE's production clusters, as well as the 
production in the ZEDE of goods and services with high domestic content so as to substitute 
imports and promote exports. The policy also aims at facilitating export producers within the ZEDE 
and promoting R&D and technology transfer. Five st rategic industries have been identified which 
should be given priority in the ZEDE: strategic industries; basic industries; information technology 
and communications; chemical and pharmaceutical products; and machinery, equipment, vehicles 
and parts.
27 As at May 2014, three projects of ZEDE had been approved: Eloy Alfaro 
(petrochemical sector) in the province of Manabí; Piady (distribution centre), in Guayas, and 
Yachay (technology and research), in Imbabura.28 
                                               
27 Ministry of Industries and Producti vity online information. Viewed at: 
http://www.industrias.gob.ec/que-son-las-zede/. 
28 Ministry of Industries and Producti vity online information. Viewed at: 
http://www.industrias.gob.ec/wp-content/uploads/2012/10/Proyectos-de-ZEDE.pdf. WT/BOP/S/18 
 
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  4.2  Investment policy framework 
42.  Ecuador is open to foreign investment in sectors not classified as strategic, including 
manufacturing, retail trade and services. Foreign investment with up to 100% foreign participation is allowed without prior authorization or review in most sectors also open to domestic private 
investment, and, in these cases, national treatmen t applies. Foreign investors must register their 
investments with the Central Bank for statistical purposes. Private companies must distribute 15% of pre-tax profits to their employees each year. There is no restriction for the repatriation of profits 
or the remittance of royalties; however they are subject to a tax on capital outflows, which was 
increased from 2% to 5% in November 2011.  
43.  The Constitution reserves for the state the re sponsibility to manage strategic sectors (energy, 
telecommunications, non-renewable natural resour ces, such as petroleum, natural gas, and 
mining, transportation, hydrocarbon refining, medi a, water, biodiversity, and genetic patrimony) 
through state-owned or controlled companies. Despite this, Ecuador allows foreign investment in petroleum; until 2010, this was done through production-sharing contracts with the state oil 
company Petroecuador. Through this modality, priv ate investors received a share of the profits. 
Since the reforms introduced by Ecuador's Hydrocarbons Law, which came into effect in July 2010 and provided the legal framework for the Government to negotiate new contracts with foreign oil 
companies, this scheme was replaced by a fee- for-service one. The introduction of the new 
scheme resulted in new service contracts for seven concessions with five operators, while three operators closed their business in Ecuador. Under this scheme, the State receives an initial payment of 25% of gross revenues as a sovereign margin, while private companies receive a 
negotiated per barrel tariff for oil produced. However since 2012, the scheme has been made more 
flexible and has become a hybrid system between the first two. 
44.  The state has sole rights for the domestic fuel distribution, refining, and transport activities. 
Fuel prices are controlled and subsidized by the Central Government. In January 2013, 
Petroecuador's production branch was absorbed by Petroamazonas. 
45.  The mining sector is relatively open to foreign investment, but investment is modest 
compared to other countries in the region. Foreigners are granted national treatment in the case of 
large-scale mining concessions, but may not invest in small-scale mining operations. Royalties to be paid to the Government are in the 5%-8% range and all mining concessionaires must pay a 12% tax on normal profits and a 70% tax on extraordinary profits (above a certain threshold).  
46.  The National Mining Company (ENAMI), established in 2010, engages in joint ventures with 
state and private companies and has the right to reject requests to establish mining operations in areas considered of interest by the Government. 
47.  The Organic Law of Production Incentives and Fiscal Fraud Prevention of 22 December 2014 
established a number of investment incentives and guarantees, including fiscal stability at a 22% income tax rate for investments in metallic mining at large and medium scale and basic industries, 
and at 25% for other investments. Also, new investments in basic industries are exempt from 
income tax for 10 years. 
4.3  Tariffs and other duties 48.  Ecuador's MFN applied tariff for 2015 comprises 7,509 HS 10-digit lines, 95% of which are 
subject to ad valorem  duties (Table 4).
29 Compound rates are applied on 5% of tariff lines. Some 
86.2% of the lines concern non-agricultural goods.  A small number of lines (29) are subject to 
tariff quotas under the WTO Agreement on Agriculture. 
Table 4 Ecuador's tariff structure, 2015 
Description Number of 
lines Share (%) 
Total number of lines 7,509 100.0 
  WTO Agriculture 1,038 13.8 
  WTO Non-agriculture  6,471 86.2 
                                               
29 This does not take into account lines under HS chapter 98. WT/BOP/S/18 
 
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  Description Number of 
lines Share (%) 
  HS 01-24 1,218 16.2 
  HS 24-97 6,291 83.8 
Duty-free lines 2,834 37.7 
Ad valorem  tariffs 7,131 95.0 
Non-ad valorem  tariff 378 5.0 
Non-ad valorem  tariff with no AVEs 0 0.0 
Domestic peaks   165 2.2 
International peaksb 2,514 33.5 
Lines subject to tariff quotasc 29 0.4 
Overall standard deviation 7,509 14.3 
a Domestic tariff peaks are defined as those exceed ing three times the overall simple average applied 
rate. 
b International tariff peaks are defined as those exceeding 15%. 
c The number of tariff quota lines is based on WTO document G/AG/N/ECU/38 aligned to the HS12 
nomenclature. 
Notes: (i) The 2015 tariff is based on the HS12 nomenclatu re and consists of 7,509 tariff lines (at 10-digit 
tariff line level); (ii) WTO bound rates are used as AVEs for tariff lines without 2014 imports or where imports are recorded using a different  quantity unit than in the tariff.  
Source: WTO Secretariat, based on IDB databa se and data provided by the authorities. 
49.  Ecuador's 2015 tariff presents an 18-tiered ad valorem  rate structure; if the ad valorem  
equivalents of the 378 lines subject to compound  duties are taken into account, the number of 
rates increases to 316, according to WTO Secretariat calculations.30 The tariff presents a relatively 
high level of dispersion: 37.7% of tariff lines are duty free, while 10% of tariff lines are subject to 
a tariff rate of 15%. Some 76.8% of tariff lines are subject to a tariff between 0 and 20% 
(Table 5). In general, zero and 5% rates are applied mostly on raw materials and capital goods; 
10% or 15% rates on intermediate goods; and 20%, 25%, and 30% rates to consumer goods.  
Table 5 Frequency distribution by  rates of Ecuador's tariff, 2015 
% Frequency  % Cumulative no. of lines Cumulative %  
Duty free 2,834 37.7 2,834 37.7 
3.0 14 0.2 2,848 37.9 
5.0 931 12.4 3,779 50.3 
10.0 449 6.0 4,228 56.3 
13.0 1 0.0 4,229 56.3 
15.0 751 10.0 4,980 66.3 
17.0 2 0.0 4,982 66.4 
20.0 788 10.5 5,770 76.8 
25.0 411 5.5 6,181 82.3 
30.0 859 11.4 7,040 93.8 
31.5 3 0.0 7,043 93.8 
35.0 11 0.2 7,054 93.9 
36.0 2 0.0 7,056 94.0 
40.0 33 0.4 7,089 94.4 
45.0 24 0.3 7,113 94.7 
54.0 7 0.1 7,120 94.8 
67.5 2 0.0 7,122 94.9 
85.5 9 0.1 7,131 95.0 
Compound duty 378 5.0 7,509 100.00 
Source: WTO Secretariat, based on IDB databa se and data provided by the authorities. 
50.  The average tariff calculated by the WTO Secretariat for 2015 is 10.7%; the rate is 12% if 
AVEs are included. The average tariff for non-agri cultural products is 9.6% or 11.1% including 
AVEs, while that for agricultural goods (WTO definition) is 17.7% (17.9% if AVEs are included) 
                                               
30 COMEX Resolution No. 51-2014, which entered into force on 12 January 2015 increased rates on 
588 tariff lines, mainly corresponding to capital goods. The new rates are included in the calculations. WT/BOP/S/18 
 
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  (Table 6). Intermediate (semi-processed) goods face  the lowest tariff rates, with final goods facing 
the highest tariffs. 
Table 6 Ecuador, average MFN applied rates, 2015 
Description Number 
of lines Including 
AVEs (%) Excluding 
AVEs Including 
the tariff 
surcharge 
and AVEs Including the 
tariff 
surcharge 
and 
excluding 
AVEs 
Simple average tariff rate 7,509  12.0 10.7 22.8 20.7 
  WTO Agriculture 1,038  17.9 17.7 36.1 35.8 
  WTO Non-agriculture  6,471  11.1 9.6 20.6 18.2 
  HS 01-24 1,218 20.4 20.3 37.2 37.0 
  HS 24-97 6,291 10.4 8.8 20.0 17.5 
  ISIC 1 491 14.0 14.0 24.0 24.0 
  ISIC 2 108 0.5 0.5 1.6 1.6 
  ISIC 3 6,909 12.0 10.7 23.0 20.8 
  First stage of processing 935 11.0 10.9 17.7 17.5 
  Semi-processed 2,470 6.4 6.4 9.0 9.0 
  Fully processed 4,104 15.6 13.5 32.2 29.3 
Notes: (i) The 2015 tariff is based on the HS12 nomencla ture and consists of 7,509 tariff lines (at 10-digit 
tariff line level); (ii) A simple average calculation was applied for products having two different tariff 
surcharge rates; (iii) For tariff lines without 2014 imports or with different quantity unit, bound rates are used as AVE.  
Source: WTO Secretariat, based on IDB databa se and data provided by the authorities. 
51.  In March 2015, Ecuador introduced an import measure for balance-of-payments reasons, 
consisting of a temporary import surcharge of  5%, 15%, 20%, 25% or 45% on some 39% of its 
tariffs lines (see section 5).31 The highest surcharges generally apply on products in HS chapters 
1-24. After the tariff surcharge is taken into account on applicable goods, the average tariff is 
20.7% (22.8% if AVEs are included), compared to 10.7% (12% if AVEs are included), before the 
introduction of the surcharge. The average tariff for non-agricultural products is now 18.2% and 
35.8% for agricultural goods (20.6% and 36.1%, respectively if AVEs are included). 
52.  Ecuador grants duty-free treatment to all im ports from the Plurinational State of Bolivia, 
Colombia, and Peru, provided that they comply with the Andean Community's origin requirements; a similar treatment is provided on imports from the Bolivarian Republic of Venezuela. Ecuador also 
grants preferential treatment to imports from co untries with which it has LAIA agreements. In 
accordance with general LAIA provisions, the scope  of these preferences depends on the degree of 
development of the beneficiary country, with the Pl urinational State of Bolivia and Paraguay been 
granted the highest level of concession among LAIA participants. 
53.  Ecuador grants tariff concessions through schemes such as the drawback, and regimes such 
as the maquila, free zones, and special economic development zones. Ecuador also maintains special customs regimes that suspend the payment of  duties and other taxes levied on imports of 
goods, under certain conditions, including: the temporary importation to re-export in the same 
state or for inward processing; temporary customs storage; duty free replacement of previously imported goods for transformation or use for the production or packaging of goods for export; and 
the importation of certain goods for international trade fairs. In March 2015, Ecuador simplified the 
procedures for the reimbursement of import duties paid on imports used in exported goods, through COMEX Resolution No. 013-2015. The Resolu tion established a reimbursement rate of 5% 
for all goods, except those listed in its Annex.
32 A rate of 3% was established for a group of fish 
products and seafood. The 5% rate was determined as being the average collected tariff (value of 
tariffs collected/imports) in the 2010-14 pe riod, in accordance with the Resolution. 
                                               
31 WTO document WT/BOP/N/79, 7 April 2015. 
32 Mainly fish and seafood (subject to a 3% rate of de volution), flowers, flour, parts for the assembly of 
motor vehicles, waste, trucks, engines, fuel oil, and so me types of paper and textiles. See: COMEX Resolution 
No. 13-2015. Viewed at: http://www.comercioexterior.gob.ec/wp-content/uploads/downloads/2015/03/Resolución-013-2015.pdf. WT/BOP/S/18 
 
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  54.  Imports (and domestic goods) are subject to a value added tax (VAT) at a rate of 12%, with 
exceptions, calculated on the sum of the CIF va lue and the applicable import duty. A FodInfa 
(Children's Development Fund) contribution is applicable on all imports at 0.5% calculated on the CIF value. ICE (Consumption Tax) is applicable on certain non-essential goods at rates between 
0% and 300% calculated on the sum of the CIF value and applicable import duty. 
55.  When it acceded to the WTO, Ecuador bound 100% of its tariff lines. Tariff bindings are 
contained in Schedule CXXXIII, and range from 5%  to 85.5%. Around 98% of the tariff lines are 
bound at rates of 30% or less. The average bound rate is 21.1% (at the HS six-digit level), the 
average bound rate for agricultural goods is 25.7%, while that for non-agricultural goods (WTO definition) is 20.7% (including petroleum products). Duties on agricultural products are bound at rates ranging from 5% to 85.5%; the lo west bound rates on agricultural items are for 
seeds and cereals, as well as for cotton, and the highest for cuts and offal of certain types of 
poultry. Duties on non-agricultural goods are bound at levels ranging from 5% to 40%, with the lowest rates applying mainly to chemicals, pharmaceuticals, petroleum products and fertilizers, 
and the highest to motor vehicles. Bound rates are also higher than average for textile and 
clothing. Ecuador's tariffs are bound at lower levels than those of other Andean Community countries. Ecuador's average bound rate exceeded its average applied MFN rates by some 
9 percentage points before the surcharge was applie d. After the introduction of the surcharge, the 
average applied rate including AVEs (22.8%) exc eeds the average bound rate (21.1%. If AVEs are 
excluded, the average applied MFN rate (20.7%) is slightly lower than the average bound rate. 
56.  Ecuador continues to implement the Andean Price Band System for a number of agricultural 
products, including wheat, maize, soybeans, pork meat, some poultry cuts and dairy products. The 
goal is to stabilize the prices of these products. Stabilization is achieved by increasing ad valorem  
tariffs when the international price is below the band's floor level for each product category, and 
lowering the tariff to zero, when the price is above the ceiling. The Price Band System is equivalent 
to turning the tariff into a variable factor that adjusts automatically to counteract international price fluctuations.
33 In May 2015, the Andean Price Band system covered 13 "marker" products 
whose international prices constitute the basis for the calculation of the price bands, and 
156 derivatives or substitutes of the "markers" (co rresponding to about 2% of all tariff lines).34  
4.4  Import Restrictions and Licensing  57.  Under Ecuador's import licensing regime, prior import control, permit, licence or authorization 
is required for some 18% of tariff lines. Licensing applies to imports of all origins, except for 
certain agricultural items originating in Andean Community countries. No licence is required for imports entering under a special customs regime , except for hazardous wastes, agricultural 
products, and narcotics and psychotropic substances. In the last Trade Policy Review of Ecuador, 
in 2011, 1,364 ten digit tariff items were identified as requiring some type of licence (2,260 including SPS requirements). However, since then other products have been added to the 
list of goods subject to import licensing requirements. For instance, as from August 2011, 
53 ten-digit tariff items (certain types of tyres, semi-finished and steel articles, refrigerators, freezers, mobile phones, completely knocked down (CKD) kits for mobile phones, television sets and motor vehicles), have been subject to non-automatic import licensing requirements. Also, 
Resolution No. 102 of the COMEX (published in the Supplement to Official Journal No. 924 of 
2 April 2013) subjected 55 tariff subheadings corresponding to basic food products to non-automatic import licensing, to be granted by the Ministry of Agriculture, Livestock, 
Aquaculture and Fisheries (MAGAP); Resolution No. 299-A (published in Official Journal No. 48 of 
31 July 2013) contains the MAGAP Directive concerning the procedures for obtaining non-automatic import licences for food staples.  
                                               
33 Andean Community online information (in Spanish). Viewed at: 
http://www.comunidadandina.org/Seccion.aspx?id=152& tipo=TE&title=sistema-andino-de-franjas-de-precios-
safp. 
34 The marker products are: white rice (HS 1006.30.00); beer barley USA Nº 2 (HS 1003.00.90); yellow 
maize USA Nº 2 (HS 1005.90.11); white maize USA Nº 2. (HS 1005.90.12); yellow soy USA Nº 2 (HS1201.00.90); Hard Red Winter wheat Nº 2 (HS 1001.10.90); raw soybean oil (HS 1507.10.00); raw palm oil (HS 1511.10.00); refined white sugar (HS 1701.99.00); raw sugar (HS 1701.11.90); whole powder milk without sugar (HS 0402.21.19); leg quarters in bulk (HS 0207.14.00); and pork meat (Boston butts, 
HS 0203.29.00). Andean Community online information (in Spanish). Viewed at: 
http://www.comunidadandina.org/Seccion.aspx?id=152& tipo=TE&title=sistema-andino-de-franjas-de-precios-
safp. WT/BOP/S/18 
 
- 18 - 
 
  58.  Additional import licensing requirements  are contained in COMEX Resolution No. 81 of 
30 July 2012, which makes imports under four tariff  subheadings corresponding to cotton products 
subject to import licences, to be granted by the MAGAP. COMEX Resolution No. 89  of 24 October 
2012 contains a list of tariff subheadings subject to  import licences, to be granted by the Ministry 
of Transport and Public Works (MTOP), while COMEX Resolution No. 95 of 7 December 2012 
regulates import licences for three-wheeled motor ve hicles, to be granted by the National Transit 
Agency (ANT).35 
59.  In October 2013, Ecuador notified to the Import Licensing Committee that pursuant to 
Article 72(f) of the Organic Code of Production, Tr ade and Investment, published in Official Journal 
No. 351 of 29 December 2010, COMEX is responsible for issuing regulations on import licensing and import procedures.
36 
4.5  Contingency Measures 
4.5.1  Anti-dumping and countervailing measures 60.  The legal framework governing antidumping and countervailing measures comprises: the 
relevant WTO Agreements and GATT 1994 provisions ; the 2010 Organic Code of Production, Trade 
and Investment; the Regulation Implementing Pa rt IV of the 2010 Organic Code; and Andean 
Community Decisions Nos. 283, 456, and 457. The Ministry of Foreign Affairs, Trade, and 
Integration is responsible for conducting investigations, while COMEX is charged with administering 
antidumping and countervailing duties.  
61.  As at 31 March 2015, Ecuador did not have any definitive anti-dumping measure in force; 
however, its latest notification to the WTO in that respect was for the period 
1 January-30 June 2014.
37 Since 2010, only one investigation has been initiated, with respect to 
metallized polypropylene up to 25 microns thick (HS code 3920.20) from Chile and Oman.38 The 
investigation was closed without applying provisional or definitive measures.39 
62.  Ecuador did not have any countervailing measure in place as at 31 December 2014. Ecuador 
did not initiate any countervailing duty investigation during the 2010-14 period.40 
63.  In July 2013, Ecuador notified to the WTO that it neither granted nor maintained on its 
territory any subsidies that fall within the meaning of Article 1.1 of the Agreement on Subsidies 
and Countervailing Measures or that are specific within the meaning of Article 2 of that Agreement.
41 
4.5.2  Safeguard measures 
64.  In April 2012, Ecuador introduced new regulations for the conduction of safeguard 
investigations. Since 2010, Ecuador has initiated two safeguard investigations in the WTO; one case, started in 2010 resulted in the imposition of definitive measures, while the second case, 
started in August 2014, led to the imposition of provisional measures and was still ongoing as of 
May 2015.
42 
65.  In October 2010, Ecuador decided to apply a safeguard measure on imports of windshields 
classified under tariff subheading 7007.21.00.00 for three years starting 1 November 2010.43 The 
measure consisted of an import surcharge, appl ied on a progressively liberalized scale at the 
following rates: first year, US$12.72 per unit; second year, US$9.54; first half of third year, US$6.36; and second half of third year, US$3.18. Ecuador also notified the non-application of the 
                                               
35 WTO document G/LIC/N/1/ECU/5, 20 June 2014. 
36 WTO document G/LIC/N/1/ECU/4, 3 October 2013. 
37 WTO document G/ADP/N/259/Add.1, 17 October 2014.  
38 WTO document G/ADP/N223/ECU, 16 January 2012. 
39 WTO document G/ADP/N230/ECU, 9 August 2012. 
40 WTO documents of the G/SCM/N/ series. 
41 WTO document G/SCM/N/253/ECU, 17 July 2013. 
42 WTO documents G/SG/N/6/ECU/8, 26 April 2010 and G/SG/N/6/ECU/9, 2 September 2014, 
respectively. 
43WTO document G/SG/N/8/ECU/3, G/SG/N/10/ECU/4, 21 October 2010. WT/BOP/S/18 
 
- 19 - 
 
  measure to Chile and Peru in accordance with Article 9.1 of the Agreement.44 The measure expired 
at end-October 2013. 
66.  The second investigation relates to wood and bamboo flooring and accessories thereof, 
classified under tariff subheadings 4409101000; 4409102000; 4409109000; 4409210000; 
4409291000; 4409292000; and 4409299000. Provisional measures were applied in October 2014, 
consisting of a specific tariff of US$1.50 per kg of imports for 200 days.45 In April 2015, Ecuador 
notified the WTO that it had made a finding of serious injury or threat thereof caused by the 
increase in imports.46 
4.6  Unilateral Preferential Access to Third Markets 67.  Ecuador remains a beneficiary of the Generaliz ed System of Preferences schemes of Australia, 
Canada, the European Union, Japan, New Zealand,  the Russian Federation, Turkey, Switzerland, 
and the United States. As a Lesser Relative Economic Development Country in LAIA (together with 
the Plurinational State of Bolivia and Paraguay), Ecuador benefits from special and differential 
treatment, including a wider margin of preference from participating countries. 
5  THE TRADE MEASURE APPLIED AND ITS POSSIBLE EFFECT 
5.1  The Measure Applied 68.  On 2 April 2015, Ecuador notified on the ba sis of paragraph 9 of the Understanding on the 
Balance of Payments Provisions of the General Agreement on Tariffs and Trade 1994, that on 
11 March 2015, it had introduced a temporary tariff surcharge for a period of up to 15 months in order to regulate the general level of imports and thereby resolve Ecuador's critical balance of payments problems. In its notification, Ecuador stated that the notified measure did not exceed 
what was necessary to address Ecuador's balance of  payments disequilibrium, expected to amount 
to between US$2 billion and US$2.4 billion in 2015.
47 Ecuador also noted that, since the second 
half of 2014, the international environment had be en unfavourable to the Ecuadorian economy due 
to lower international prices of oil and other commodities, the decline in remittances from 
Ecuadorian residents abroad and the appreciation of  the U.S. dollar, among other factors, and this 
had taken its toll on the balance of payments. Ecuador also stated that the purpose of the measure 
was to rapidly offset the deterioration of the balance of payments and the decrease in liquidity 
available to the Ecuadorian economy. Ecuador noted that the measure had been introduced pursuant to Article XVIII, Section B of the GA TT 1994 and the Understanding on the Balance of 
Payment Provisions of the GATT 1994. The general tariff surcharge was described in Resolution 
No. 011-2015 issued by the Foreign Trade Commi ttee (COMEX), published in the Supplement to 
Official Journal No. 456 of 11 March 2015, and attached as Annex 1 to the notification.
48 
69.  In its notification, Ecuador stated that the tariff surcharge applied to 2,955 10-digit lines, or 
38% of a total of 7,581 tariff lines, which in monetary terms amounted to 31% of imports 
recorded in 2014. The surcharge is applied at ad valorem  rates of 5%, 15%, 25% and 45%, 
calculated on the basis of the c.i.f. value of import s as indicated for each tariff line in the Annex to 
Resolution No. 011-2015. Ecuador provided a list of tariff lines for which the bound rate was 
exceeded by the tariff surcharge, stating, in each case, by how much it was exceeded. Ecuador 
stated that it would monitor and assess the application of the measure on a quarterly basis; it would relax the measure as the balance of payments  improved and would eliminate it when it was 
no longer necessary. The Plurinational State of Bolivia and Paraguay were excluded from the 
application of the measure due to their status as Lesser Relative Economic Development Country in LAIA. 
70.  COMEX Resolution No 016-2015 of 8 April 2015, which entered into force immediately, made 
some modifications to the list of tariff lines subject to the surcharge. Namely, it removed six items 
                                               
44 WTO document G/SG/N/8/ECU/3/Suppl.1, G/ SG/N/10/ECU/4/Suppl.1, G/SG/N/11/ECU/1, 
27 October 2010. 
45 WTO document G/SG/N/7/ECU/3, 23 October 2014. 
46 WTO document G/SG/N/8/ECU/4, 24 April 2015. 
47 WTO document WT/BOP/N/79, 7 April 2015. 
48 WTO document WT/BOP/N/79, 7 April 2015. WT/BOP/S/18 
 
- 20 - 
 
  from the list, lowering the number of lines subjec t to the surcharge to 2,949, and provided for 
exclusions from the surcharge49, under certain specific circumstances, for 36 tariff lines.50 
5.2  Effect of the Measure 5.2.1  Number and percentage of tariff lines 
71.  According to WTO Secretariat calculations, which is based on the information provided by 
Ecuador, the share of Ecuador's tariff lines subject to the import surcharge is 39.1% of the total. The tariff surcharge is applied on 2,938 tariff lines and has five tiers: 5%, 15%, 20%, 25% or 
45%.
51 The majority of tariff lines face a surcha rge of 45% or 25%: some 45.4% of lines are 
subject to a 45% surcharge, while 13.2% face a surcharge of 25%. On the other hand, 24% of tariff lines are subject to a surcharge of 5% (Table 7). In some cases, the same tariff line is subject to two rates (0 and 5%; 0 and 15%; 0 and 45%), according to the product. Those 
products have been identified by Ecuador in Annex I of its notification to the WTO. 
Table 7 Frequency distribution of th e tariff surcharge applied by Ecuador 
Tariff Surcharge Number of lines % of the total number 
of lines with surcharge % of the total number 
of MFN lines 
0 3 0.1 0.04 
0 or 5 15 0.5 0.20 
5 707 24.0 9.42 
0 or 15 29 1.0 0.39 
15 421 14.3 5.61 
20 1 0.0 0.01 
25 389 13.2 5.18 
0 or 45 40 1.4 0.53 
45 1,333 45.4 17.75 
Total 2,938 100.0 39.13 
Source: WTO Secretariat calculations, based on information provided by the authorities. 
72.  A comparison of average bound duties, applie d tariff rates and applied tariff rates including 
the import surcharge, by WTO product categories is shown in Chart 3.  
                                               
49 HS codes 401110100, 401110900, 870590900, 8516100000, 8516299000, and 8516601000. 
50 Of which, 12 lines are Chapter 98 lines, which comprises special classification provisions for national 
use. The remaining 24 lines include 16 lines under HS co de 7323 (table, kitchen or other household articles 
and parts thereof, of iron or steel) and 2 lines corresponding to pressure cookers, when imported by importers 
of kitchenware registered at the Minist ry of Industry and Productivity for equipment used to replace the use of 
GLP for electricity, as well as impo rts of auto parts by domestic assembly companies registered as such 
(2 lines), vehicles to supply cement (2 lines); some live  animals imported by biological control bodies (1 line); 
sacks and bags of jute or of other textile fibres, of a kind used for the packing of goods (1 line); and radial 
pneumatic tyres (1 line, on ly for duty-free quotas as  established in COMEX Resolutions No. 36, 62, 74 and 88 
of 2012). 
51 Ecuador's original submission mentioned 2,955 HS2012 lines at 10-digit level, of which six were 
eliminated by Resolution No.16-2015. However, when wo rking on the submission, the Secretariat found that 
among the 2,949 remaining lines, there were five inva lid HS2012 codes, one was a subheading including two 
tariff lines, and five lines were really not such but subheadings for wh ich the comprising lines had already been 
included in the submission. WT/BOP/S/18 
 
- 21 - 
 
  Chart 3 Average tariff rates, by WTO product categories, 2015 
(%) 
010203040506070
1 2 3 4 5 6 7 8 9 1 01 11 21 31 41 51 61 71 81 92 02 12 22 32 41 WTO Agriculture
2 Animals and products
3 Dairy products
4 Fruit, vegetables, and 
plants5 Coffee and tea
6 Cereals and preparations
7 Oil seeds, fats and oils and their products      8 Sugars and confectionary
9 Beverages, spirits, and 
tobacco
10 Cotton
11 Other agricultural products
12 WTO non-agriculture
13 Fish and fishery products14 Minerals and metals15 Chemicals and 
photographic supplies
16 Wood, pulp, paper, and 
furniture
17 Textiles18 Clothing19 Leather, rubber, 
footwear, and travel goods
20 Non-electric machinery
21 Electric machinery
22 Transport equipment23 Non-agricultural 
products
24 PetroleumApplied tariff rates + 
import surchage
Bound 
tariff 
ratesApplied tariff rates
 
Note: Calculations include AVEs (based on 2014 imports). For tariff lines without 2014 imports or with 
different quantity unit, bound  rates were used as AVE. 
Source: WTO calculations, based on information provided by the authorities of Ecuador. 
5.2.2  Effect on applied tariff level 
73.  As a result of the imposition of the surcharge, Ecuador's average MFN applied rate increased 
by 10.8 percentage points, from 12% to 22.8%, incl uding AVEs, or by 10 percentage points, from 
10.7% to 20.7%, excluding them. Bindings are amply exceeded in the case of agricultural 
products (36.1% applied rate including surcharge compared to a 25.7% bound rate), while the gap 
is considerably smaller in the case of non-agricultural products (20.6% compared to 20.3%). 
74.  After the imposition of the import surcharge, applied tariffs exceed bound levels for 28.0% of 
all tariff lines (2,101 HS tariff lines at a 10-digit level). In the case of products falling under the 
WTO definition of agriculture, bound rates are exceeded for 43.5% of the lines (6.0% of total 
lines), while for non-agricultural products, applie d rates including the surcharge, exceed bindings 
for 25.5% of tariff lines (22.0% of total lines). Bindings are exceeded across all WTO product 
categories, except petroleum and cotton: They are exceeded only for five lines each in the case of 
oil seeds, fats and oils; and sugar and confectionery (0.1% of the total, but 4.5% and 17.9%, respectively of each category). Other categories were bound rates are exceeded for only a small 
percentage of lines include chemicals (3.9% of lines), and fish and fishery products (13.5%). 
Bound rates are exceeded across 100% of tariff lines in the case of clothing and on 97.3% of tariff lines for beverages, spirits and tobacco (Table 8). Other product categories where bindings are exceeded in a significant share of lines (above 40%) include: animal products; dairy products; 
fruits, vegetables and plants; coffee and tea; elec tric machinery; leather, rubber and footwear; 
and transport equipment sugars and confectionary, and cotton.  WT/BOP/S/18 
 
- 22 - 
 
  Table 8 Ecuador, applied tariffs vs bound tariffs  
 No. of 
tariff 
lines  Applied 
tariffsa 
(%) No. of 
tariff lines 
subject to 
the 
surcharge Applied 
tariffs with 
import 
surchargea 
(%) Bound 
tariffsb 
(%) Lines where bound rates are 
exceeded due to the 
surcharge 
No. of 
tariff 
lines 
(10- 
digit 
level) % of 
total 
lines 
2015 % of 
total 
lines of 
each 
product 
group 
Total  7,509 12.0  2,938  22.8 21.1 2,101 28.1 28.1  
WTO Agriculture 1,038 17.9 484 36.1 25.7 452 6.0 43.5 
Animals and 
 products thereof 138 26.7  94 56.3 28.8 94 1.3 68.1  
Dairy products 36 30.8 20 55.8 46.0 18 0.2 50.0 
Fruit, vegetables and 
plants 298 19.4  150 41.5 23.8 150 2.0 50.3  
Coffee and tea 32 23.4 25 48.0 26.3 19 0.3 59.4 
Cereals and 
preparations 138 18.6  69 36.2 26.3 64 0.9 46.4  
Oil seeds, fats and oils 
and their products 112 11.9 7 13.7 27.6 5 0.1 4.5 
Sugars and 
 confectionary 28 12.5  17 22.0 34.3 5 0.1 17.9  
Beverages, spirits and 
 tobacco 74 25.7 72 61.5 26.5 72 1.0 97.3 
Cotton 8 4.4   4.4 15.0 0 0.0 0.0  
Other agricultural 
 products n.e.s. 174 5.9 30 11.6 19.1 25 0.3 14.4 
WTO Non-agriculture 
(including petroleum) 6,471 11.1  2,454  20.6 20.3 1,649 22.0 25.5  
WTO Non-agriculture 
(excluding petroleum) 6,422 11.1 2,454  20.8 20.4 1,649 22.0 25.7 
Fish and fishery 
 products 265 24.8  36 30.9 28.9 36 0.5 13.6  
Minerals and metals 1,094 7.6 370 17.6 20.5 264 3.5 24.1 
Chemicals and 
photographic supplies 1,551 2.6  67 4.0 10.9 60 0.8 3.9  
Wood, pulp, paper and 
furniture 332 13.5 101 26.1 23.0 101 1.3 30.4 
Textiles 685 21.0  591 29.8 27.8 131 1.7 19.1  
Clothing 255 32.0 255 57.0 30.0 255 3.4 100.0  
Leather, rubber, 
footwear and travel goods 212 13.5  94 29.6 24.0 92 1.2 43.4  
Non-electric 
 machinery 783 6.8 281 14.1 19.6 176 2.3 22.5 
Electric machinery 423 10.8  214 24.9 22.5 183 2.4 43.3  
Transport equipment 258 14.1 102 29.7 23.8 96 1.3 37.2 
Non-agriculture articles 
 n.e.s. 564 16.2  343 36.7 23.9 255 3.4 45.2  
Petroleum 49 2.6 0 2.6 14.7 0 0.0 0.0 
Notes: (i) The number of lines where bound rates are exceeded was estimated using the 2015 applied tariff 
schedule (HS 2012) and the bound tariff schedule (HS 2007) using World Customs Organization correlation tables between HS 2007 and HS 2012; (ii) A simple average calculation was applied for products presenting two different tariff surcharge rates; (iii) For tariff lines without 2014 imports or with different quantity units, AVEs were calculated  using bound rates; (iv)  n.e.s. stands for not 
elsewhere specified. 
a The 2015 tariff is based on HS12 nomenclature consisting of 7,509 tariff lines (at 10-digit tariff line 
level).  
b Final bound rates were aligned to the 2015 applied tariff schedule (HS12 nomenclature) by the 
Secretariat.  
Source: WTO calculations, based on IDB data, informatio n provided by the Ecuadorian authorities, and WTO 
CTS database. 
5.2.3  Value of trade and main trading partners affected by the surcharge 
75.  The tariff surcharge measure applied by Ecuador affects a value of trade of US$8.34 billion 
(2014), equivalent to 30.3% of its total 2014 c.i.f. imports (Table 9). The categories with the 
highest value of trade affected by the surcharge include: non-electric machinery (US$1.94 billion, WT/BOP/S/18 
 
- 23 - 
 
  or 57% of total imports of that category); el ectric machinery (US$1.47 billion); minerals and 
metals (US$1.24 billion); transport equipmen t (US$797 million); non-agriculture articles 
(US$650 million); textiles (US$436 million); clothing  (US$294 million) and leather and footwear 
(US$356 million). The results are, however, different if the share of total value of trade per 
category is considered. In this case, the categories more hardly touched by the measure were 
clothing; and beverages, spirits and tobacco, where the measure affected 100% of the value of imports. Other categories particularly affected by  the surcharge in value terms include: coffee and 
tea (99%); dairy products (88.8%); sugars and confectionery (85.7%); fruits vegetables and 
plants (84%); textiles (70%); leather, rubber, an d footwear (61.9%); animal products (60.6%); 
and electric machinery (60.5%).  
Table 9 Ecuador, import surcharge freque ncy by category and value of imports 
Description No. of tariff 
lines with 
surcharge Value of 2014 
imports of tariff 
lines with 
surcharge 
(US$ million) % of total 
2014 imports % of total 2014 
imports of each 
product group 
All Products 2,938  8,340.7  30.3  30.3 
WTO Agriculture 484  728.5  2.6  34.6 
 Animals and products thereof 94  27.7  0.1  60.6 
 Dairy products 20  5.0  0.0  88.8 
 Fruit, vegetables and plants 150  227.2  0.8  84.0 
 Coffee and tea 25  66.1  0.2  99.0 
 Cereals and preparations 69  260.3  0.9  36.1 
 Oil seeds, fats and oils and 
their Products 7  6.1  0.0  1.1 
 Sugars and confectionary 17  60.5  0.2  85.7 
 Beverages, spirits and tobacco 72  49.2  0.2  100.0 
 Cotton  0.0  0.0  0.0 
 Other agricultural products 
n.e.s. 30  26.3  0.1  10.0 
WTO Non-agriculture 
(including  petroleum) 2,454  7,612.1  27.7  30.1 
 WTO Non-agriculture 
(excluding petroleum) 2,454  7,612.1  27.7  34.7 
  Fish and fishery products 36  6.1  0.0  3.7 
  Minerals and metals 370  1,239.6  4.5  19.9 
  Chemicals and photographic 
supplies 67  228.2  0.8  5.7 
  Wood, pulp, paper and 
furniture 101  200.4  0.7  27.3 
  Textiles 591  435.8  1.6  70.0 
  Clothing 255  294.2  1.1  100.0 
  Leather, rubber, footwear and 
travel goods 94  355.6  1.3  61.9 
  Nonelectric machinery 281  1,935.9  7.0  57.0 
  Electric machinery 214  1,470.0  5.3  60.5 
  Transport equipment 102  796.7  2.9  33.8 
  Non-agriculture articles n.e.s. 343  649.6  2.4  58.6 
 Petroleum 0  0.0  0.0  0.0 
Source: WTO Secretariat calculations, based on information provided by the authorities. 
76.  Table 10 identifies Ecuador's top trading partners per WTO product category, based on 2014 
trade figures. In 2014, 21.3% of Ecuador's imports of agriculture products (WTO definition) came 
from the United States, followed by Peru (14.2%), Argentina (12.3%) and Chile (11.9%). For non-agriculture products (WTO definition), 32.7% of Ecuador's 2014 imports came from the 
United States, followed by China (14.0%), and the EU (28) China (11.4%). WT/BOP/S/18 
 
- 24 - 
 
  Table 10 Ecuador's top 10 origins of imports per WTO product category, 2014 
 Value  
(US$ 
1,000) Share  
(%)  Value  
(US$ 1,000) Share  
(%) 
1. WTO agriculture   12. WTO non-agriculture   
   World 2,105,675 100.0    World 25,296,637 100.0 
   1. United States 448,806 21.3    1. United States 8,280,423 32.7 
   2. Peru 298,295 14.2    2. China 3,541,774 14.0 
   3. Argentina 258,198 12.3    3. EU (28) 2,884,450 11.4 
   4. Chile 249,625 11.9      Spain 605,885 2.4 
   5. Colombia 182,772 8.7      Germany 563,767 2.2 
   6. Canada 169,182 8.0      Netherlands 454,720 1.8 
   7. EU (28) 109,239 5.2    4. Colombia 2,017,159 8.0 
     Spain 30,760 1.5    5. Panama 1,410,837 5.6 
     Netherlands 25,728 1.2    6. Mexico 910,544 3.6 
     Italy 13,613 0.6    7. Korea, Republic of 901,223 3.6 
   8. Plurinational State of 
Bolivia 106,265 5.0    8. Brazil 780,640 3.1 
   9. Brazil 82,752 3.9    9. Peru 725,829 2.9 
   10. Mexico 53,394 2.5    10. Japan 569,078 2.2 
2. Animals and products   13. Fish and fishery 
products   
   World 45,624 100.0    World 163,996 100.0 
   1. United States 10,644 23.3    1. Special Categories 97,115 59.2 
   2. Chile 9,016 19.8    2. Peru 22,762 13.9 
   3. Peru 8,846 19.4    3. United States 13,588 8.3 
   4. Brazil 7,948 17.4    4. Kiribati 5,666 3.5 
   5. Canada 4,468 9.8    5. Micronesia, Federated 
States of 4,430 2.7 
   6. Colombia 1,810 4.0    6. Chile 4,341 2.6 
   7. EU (28) 1,179 2.6    7. EU (28) 2,890 1.8 
     Spain 736 1.6      Spain 1,617 1.0 
     Netherlands 385 0.8      France 468 0.3 
     Italy 37 0.1      Netherlands 276 0.2 
   8. Uruguay 1,050 2.3    8. Free Zones 1,483 0.9 
   9. Argentina 244 0.5    9. Colombia 1,389 0.8 
   10. Mexico 193 0.4    10. Panama 1,244 0.8 
3. Dairy products   14. Minerals and metals   
   World 5,682 100.0    World 6,233,764 100.0 
   1. Chile 3,087 54.3    1. United States 2,014,521 32.3 
   2. Peru 731 12.9    2. EU (28) 977,175 15.7 
   3. Brazil 669 11.8      Netherlands 274,797 4.4 
   4. United States 558 9.8      Spain 259,914 4.2 
   5. EU (28) 482 8.5      Belgium-Luxembourg 124,946 2.0 
     Denmark 253 4.5    3. China 885,360 14.2 
     Poland 78 1.4    4. Panama 606,870 9.7 
     Spain 68 1.2    5. Mexico 232,251 3.7 
   6. Mexico 81 1.4    6. Colombia 194,011 3.1 
   7. Colombia 73 1.3    7. Bahamas 180,050 2.9 
      8. Peru 173,291 2.8 
      9. India 148,091 2.4 
      10. Argentina 143,412 2.3 
4. Fruit, vegetables and 
plants   15. Chemicals and photographic supplies  
   World 270,583 100.0    World 4,014,630 100.0 
   1. Chile 126,822 46.9    1. Colombia 748,293 18.6 
   2. Peru 51,531 19.0    2. United States 705,151 17.6 
   3. EU (28) 24,182 8.9    3. EU (28) 621,282 15.5 
     Netherlands 10,370 3.8      Germany 167,972 4.2 
     Belgium-Luxembourg 4,298 1.6      Belgium-Luxembourg 135,067 3.4 
     Spain 3,760 1.4      Spain 89,646 2.2 
   4. United States 21,660 8.0    4. China 338,574 8.4 
   5. Canada 15,086 5.6    5. Mexico 214,949 5.4 
   6. China 14,187 5.2    6. Brazil 213,065 5.3 
   7. Colombia 6,579 2.4    7. Peru 174,803 4.4 WT/BOP/S/18 
 
- 25 - 
 
   Value  
(US$ 
1,000) Share  
(%)  Value  
(US$ 1,000) Share  
(%) 
   8. Argentina 2,004 0.7    8. Panama 146,049 3.6 
   9. Costa Rica 1,550 0.6    9. Korea, Republic of 140,597 3.5 
   10. Mexico 1,466 0.5    10. Chile 126,357 3.1 
5. Coffee and tea   16. Wood, pulp, paper and furniture  
   World 66,745 100.0    World 733,100 100.0 
   1. Colombia 31,043 46.5    1. Colombia 201,522 27.5 
   2. Brazil 9,975 14.9    2. China 101,928 13.9 
   3. United States 9,731 14.6    3. EU (28) 90,137 12.3 
   4. EU (28) 5,386 8.1      Spain 24,514 3.3 
     Italy 2,276 3.4      Germany 20,549 2.8 
     Belgium-Luxembourg 1,735 2.6      Italy 11,351 1.5 
     Germany 516 0.8    4. Chile 84,843 11.6 
   5. Chile 4,648 7.0    5. United States 82,831 11.3 
   6. Peru 3,578 5.4    6. Brazil 42,806 5.8 
   7. Argentina 1,361 2.0    7. Peru 35,594 4.9 
   8. Mexico 385 0.6    8. Mexico 15,733 2.1 
   9. China 318 0.5    9. Korea, Republic of 14,506 2.0 
   10. Jamaica 156 0.2    10. Canada 8,705 1.2 
6. Cereals and preparations   17. Textiles   
   World 720,823 100.0    World 622,882 100.0 
   1. Canada 147,079 20.4    1. China 175,596 28.2 
   2. United States 142,154 19.7    2. Colombia 120,341 19.3 
   3. Chile 83,319 11.6    3. Peru 83,410 13.4 
   4. Peru 71,478 9.9    4. United States 44,040 7.1 
   5. Colombia 67,200 9.3    5. EU (28) 32,946 5.3 
   6. Mexico 44,232 6.1      Germany 10,022 1.6 
   7. EU (28) 41,594 5.8      Belgium-Luxembourg 6,322 1.0 
     Spain 16,738 2.3      Spain 6,246 1.0 
     Netherlands 8,540 1.2    6. India 25,174 4.0 
     Italy 4,873 0.7    7. Panama 24,425 3.9 
   8. Argentina 40,969 5.7    8. Korea, Republic of 20,513 3.3 
   9. Brazil 29,118 4.0    9. Brazil 18,060 2.9 
   10. Uruguay 13,036 1.8    10. Chinese Taipei 16,899 2.7 
7. Oil seeds, fats and oils and their 
Products  18. Clothing   
   World 579,899 100.0    World 294,202 100.0 
   1. Argentina 207,244 35.7    1. Colombia 86,783 29.5 
   2. United States 179,854 31.0    2. United States 47,789 16.2 
   3. Plurinational State of 
Bolivia 102,702 17.7    3. China 40,462 13.8 
   4. Peru 27,482 4.7    4. EU (28) 39,879 13.6 
   5. Brazil 16,614 2.9      Spain 35,712 12.1 
   6. Paraguay 15,500 2.7      Italy 1,988 0.7 
   7. Uruguay 9,938 1.7      Belgium-Luxembourg 914 0.3 
   8. EU (28) 6,080 1.0    5. Panama 36,914 12.5 
     Italy 3,225 0.6    6. Peru 32,467 11.0 
     Spain 2,555 0.4    7. Chile 2,403 0.8 
     Germany 160 0.0    8. Brazil 1,747 0.6 
   9. Chile 4,915 0.8    9. Hong Kong, China 1,689 0.6 
   10. China 2,526 0.4    10. Mexico 1,117 0.4 
8. Sugars and confectionary   19. Leather, rubber, footwear and travel 
goods  
   World 70,592 100.0    World 574,892 100.0 
   1. Colombia 44,598 63.2    1. China 131,383 22.9 
   2. China 6,161 8.7    2. Panama 63,503 11.0 
   3. Peru 5,011 7.1    3. United States 59,113 10.3 
   4. United States 3,577 5.1    4. Brazil 49,105 8.5 
   5. EU (28) 3,087 4.4    5. Colombia 44,863 7.8 
     Germany 838 1.2    6. Peru 39,424 6.9 
     Spain 754 1.1    7. EU (28) 36,561 6.4 
     Poland 593 0.8      Germany 9,495 1.7 
   6. Guatemala 2,023 2.9      Spain 8,626 1.5 
   7. Chile 1,457 2.1      Belgium-Luxembourg 4,726 0.8 WT/BOP/S/18 
 
- 26 - 
 
   Value  
(US$ 
1,000) Share  
(%)  Value  
(US$ 1,000) Share  
(%) 
   8. Argentina 1,432 2.0    8. Korea, Republic of 30,480 5.3 
   9. Brazil 1,201 1.7    9. Thailand 17,595 3.1 
   10. Plurinational State of 
Bolivia 747 1.1    10. Chinese Taipei 17,339 3.0 
9. Beverages, spirits and 
tobacco   20. Non-electric machinery   
   World 49,222 100.0    World 3,398,929 100.0 
   1. Chile 12,728 25.9    1. United States 1,346,192 39.6 
   2. EU (28) 8,088 16.4    2. China 598,537 17.6 
     United Kingdom 3,493 7.1    3. EU (28) 527,978 15.5 
     Germany 1,963 4.0      Germany 154,324 4.5 
     Netherlands 1,420 2.9      Italy 122,452 3.6 
   3. Colombia 7,186 14.6      Spain 85,839 2.5 
   4. Peru 5,490 11.2    4. Brazil 152,062 4.5 
   5. Mexico 4,658 9.5    5. Colombia 119,417 3.5 
   6. United States 3,662 7.4    6. Korea, Republic of 95,280 2.8 
   7. Argentina 2,935 6.0    7. Mexico 84,524 2.5 
   8. Brazil 1,553 3.2    8. Panama 75,672 2.2 
   9. Panama 1,106 2.2    9. Japan 74,775 2.2 
   10. Guatemala 523 1.1    10. Peru 56,849 1.7 
10. Cotton   21. Electric machinery   
   World 33,012 100.0    World 2,428,436 100.0 
   1. United States 26,915 81.5    1. United States 721,132 29.7 
   2. Brazil 3,781 11.5    2. China 673,412 27.7 
   3. Peru 1,624 4.9    3. EU (28) 239,115 9.8 
   4. Mexico 426 1.3      Germany 49,323 2.0 
   5. Colombia 164 0.5      Italy 46,560 1.9 
   6. India 61 0.2      Spain 42,364 1.7 
   7. Greece 30 0.1    4. Mexico 163,622 6.7 
   8. EU (28) 7 0.0    5. Colombia 108,597 4.5 
     Poland 6 0.0    6. Hong Kong, China 98,760 4.1 
     Spain 1 0.0    7. Brazil 82,275 3.4 
     Italy 0 0.0    8. Panama 64,176 2.6 
   9. China 4 0.0    9. Malaysia 63,088 2.6 
      10. Korea, Republic of 37,875 1.1 
11. Other agricultural products n.e.s.  22. Transport equipment   
   World 263,492 100.0    World 2,360,537 100.0 
   1. Peru 122,525 46.5    1. Japan 361,407 15.3 
   2. United States 50,052 19.0    2. China 354,915 15.0 
   3. Colombia 22,696 8.6    3. Korea, Republic of 348,173 14.7 
   4. EU (28) 19,122 7.3    4. United States 322,062 13.6 
     Spain 5,221 2.0    5. Colombia 234,016 9.9 
     Netherlands 4,637 1.8    6. Thailand 230,533 9.8 
     France 2,923 1.1    7. Mexico 149,150 6.3 
   5. China 14,048 5.3    8. EU (28) 127,809 5.4 
   6. Brazil 11,341 4.3      Germany 38,266 1.6 
   7. Sri Lanka 4,733 1.8      Spain 36,751 1.6 
   8. Chile 3,633 1.4      Netherlands 16,613 0.7 
   9. Guatemala 2,524 1.0    9. Brazil 57,157 2.4 
   10. India 2,288 0.9    10. Indonesia 41,494 1.8 
   23. Non-agriculture articles n.e.s.  
      World 1,108,591 100.0 
      1. United States 312,322 28.2 
      2. China 241,368 21.8 
      3. EU (28) 168,540 15.2 
        Germany 62,683 5.7 
        Italy 20,890 1.9 
        Netherlands 18,879 1.7 
      4. Colombia 153,074 13.8 
      5. Panama 36,599 3.3 
      6. Hong Kong, China 30,536 2.8 
      7. Brazil 23,446 2.1 
      8. Mexico 21,665 2.0 WT/BOP/S/18 
 
- 27 - 
 
   Value  
(US$ 
1,000) Share  
(%)  Value  
(US$ 1,000) Share  
(%) 
      9. Korea, Republic of 18,515 1.7 
      10. Chinese Taipei 13,877 1.3 
   24. Petroleum   
      World 3,362,678 100.0 
      1. United States 2,611,682 77.7 
      2. Panama 318,020 9.5 
      3. Saudi Arabia 149,263 4.4 
      4. Korea, Republic of 138,384 4.1 
      5. Peru 58,285 1.7 
      6. United Arab Emirates 28,325 0.8 
      7. Canada 25,452 0.8 
      8. EU (28) 20,137 0.6 
        Latvia 7,027 0.2 
        Germany 4,353 0.1 
        Belgium- Luxembourg 2,462 0.1 
      9. Colombia 4,855 0.1 
      10. Mexico 2,912 0.1 
Note: Products recorded under chapter 98 of the HS  nomenclature could not be classified under any 
WTO product group. They repres ent 0.4% of total Ecuador's im ports and are excluded from the 
calculations in this table. 
Source: WTO Secretariat, based on information provided by the authorities of Ecuador. 
77.  Table 11 shows the impact of the tariff surcharge on Ecuador's 10 top origins of imports per 
WTO product category, considering the value of imports and the surcharge applied on average for 
each category, and the share of each tradin g partner of the corresponding category. The 
calculations take into account the exclusion of the Plurinational State of Bolivia and Paraguay from the scope of the measure. 
Table 11 Impact of the tariff surcharge on Ecuador's top 10 origins of imports per WTO 
product category, 2014 (average for the category) 
 Value  
(US$ 1,000)  Value  
(US$ 1,000) 
1. WTO agriculture  12. WTO non-agriculture   
   1. United States 155,287     1. United States  2,492,407  
   2. Peru 103,210     2. China  1,066,074  
   3. Argentina 89,337     3. EU  (28) 868,219  
   4. Chile 86,370       Spain  182,371  
   5. Colombia 63,239       Germany  169,694  
   6. Canada 58,537       Netherlands  136,871  
   7. EU (28) 37,797     4. Colombia  607,165  
     Spain 10,643     5. Panama  424,662  
     Netherlands 8,902     6. Mexico  274,074  
     Italy 4,710     7. Korea, Republic  of 271,268  
   8.Plurinational State of Boliviaa 0    8. Brazil  234,973  
   9. Brazil 28,632     9. Peru  218,474  
   10. Mexico 18,474     10. Japan  171,292  
2. Animals and products  13. Fish and fishery products   
   1. United States 6,450     1. Special Categories  3,593  
   2. Chile 5,464     2. Peru  842 
   3. Peru 5,360     3. United States  503 
   4. Brazil 4,817     4. Kiribati  210 
   5. Canada 2,708     5. Micronesia, Federated States of 164 
   6. Colombia 1,097     6. Chile  161 
   7. EU (28) 715    7. EU  (28) 107 
     Spain 446       Spain  60 
     Netherlands 233      France  17 
     Italy 23       Netherlands  10 
   8. Uruguay 636    8. Free Zones  55 
   9. Argentina 148     9. Colombia  51 
   10. Mexico 117    10. Panama  46 WT/BOP/S/18 
 
- 28 - 
 
   Value  
(US$ 1,000)  Value  
(US$ 1,000) 
3. Dairy products  14. Minerals and metals   
   1. Chile 2,741     1. United States  400,890  
   2. Peru 649     2. EU  (28) 194,458  
   3. Brazil 594      Netherlands  54,685  
   4. United States 496       Spain  51,723  
   5. EU (28) 428      Belgium-Luxembourg  24,864  
     Denmar k 225     3. China  176,187  
     Poland 69    4. Panama  120,767  
     Spain 61     5. Mexico  46,218  
   6. Mexico 72    6. Colombia  38,608  
   7. Colombia 65     7. Bahamas  35,830  
     8. Peru  34,485  
     9. India  29,470  
     10. Argentina  28,539  
4. Fruit, vegetables and plants  15. Chemicals and photographic supplies  
   1. Chile 106,531     1. Colombia  42,653  
   2. Peru 43,286     2. United States  40,194  
   3. EU (28) 20,313     3. EU  (28) 35,413  
     Netherlands 8,711       Germany  9,574  
     Belgium-Luxembourg 3,610       Belgium-Luxembourg  7,699  
     Spain 3,159       Spain  5,110  
   4. United States 18,194     4. China  19,299  
   5. Canada 12,673     5. Mexico  12,252  
   6. China 11,917     6. Brazil  12,145  
   7. Colombia 5,526     7. Peru  9,964  
   8. Argentina 1,683     8. Panama  8,325  
   9. Costa Rica 1,302     9. Korea, Republic  of 8,014  
   10. Mexico 1,231     10. Chile  7,202  
5. Coffee and tea  16. Wood, pulp, paper and furniture 
   1. Colombia 30,733     1. Colombia  55,015  
   2. Brazil 9,876     2. China  27,826  
   3. United States 9,633     3. EU  (28) 24,607  
   4. EU (28) 5,332       Spain  6,692  
     Italy 2,253       Germany  5,610  
     Belgium-Luxembourg 1,718       Italy  3,099  
     Germany 510    4. Chile  23,162  
   5. Chile 4,602     5. United States  22,613  
   6. Peru 3,542     6. Brazil  11,686  
   7. Argentina 1,347     7. Peru  9,717  
   8. Mexico 382    8. Mexico  4,295  
   9. China 315     9. Korea, Republic  of 3,960  
   10. Jamaica 154    10. Canada  2,376  
6. Cereals and preparations   17. Textiles   
   1. Canada 53,095     1. China  122,917  
   2. United States 51,317     2. Colombia  84,239  
   3. Chile 30,078     3. Peru  58,387  
   4. Peru 25,804     4. United States  30,828  
   5. Colombia 24,259     5. EU  (28) 23,062  
   6. Mexico 15,968       Germany  7,015  
   7. EU (28) 15,015       Belgium-Luxembourg  4,425  
     Spain 6,043       Spain  4,372  
     Netherlands 3,083     6. India  17,622  
     Italy 1,759     7. Panama  17,097  
   8. Argentina 14,790     8. Ko rea, Republic  of 14,359  
   9. Brazil 10,512     9. Brazil  12,642  
   10. Uruguay 4,706     10. Chinese Taipei  11,829  
7. Oil seeds, fats and oils and their Products 18. Clothing   
   1. Argentina 2,280     1. Colombia  86,783  
   2. United States 1,978     2. United States  47,789  
   3. Plurinational State of Boliviaa 0    3. China  40,462  
   4. Peru 302     4. EU  (28) 39,879  
   5. Brazil 183      Spain  35,712  
   6. Paraguayb 0       Italy  1,988  WT/BOP/S/18 
 
- 29 - 
 
   Value  
(US$ 1,000)  Value  
(US$ 1,000) 
   7. Uruguay 109      Belgium-Luxembourg  914 
   8. EU (28) 67     5. Panama  36,914  
     Italy 35    6. Peru  32,467  
     Spain 28     7. Chile  2,403  
     Germany 2    8. Brazil  1,747  
   9. Chile 54     9. Hong Kong, China  1,689  
   10. China 28    10. Mexico  1,117  
8. Sugars and confectionary   19. Leather, rubber, footwear and travel goods 
   1. Colombia 38,221     1. China  81,326  
   2. China 5,280     2. Panama  39,308  
   3. Peru 4,294     3. United States  36,591  
   4. United States 3,066     4. Brazil  30,396  
   5. EU (28) 2,645     5. Colombia  27,770  
     Germany 718     6. Peru  24,403  
     Spain 646    7. EU  (28) 22,631  
     Poland 508       Germany  5,877  
   6. Guatemala 1,734       Spain  5,339  
   7. Chile 1,249       Belgium-Luxembourg  2,926  
   8. Argentina 1,227     8. Korea, Republic  of 18,867  
   9. Brazil 1,030     9. Thailand  10,892  
   10. Plurinational State of Boliviaa 0    10. Chinese Taipei  10,733  
9. Beverages, spirits and tobacco  20. Non-electric machinery   
   1. Chile 12,728     1. United States  767,329  
   2. EU (28) 8,088     2. China  341,166  
     United Kingdom 3,493     3. EU  (28) 300,948  
     Germany 1,963       Germany  87,965  
     Netherlands 1,420       Italy 69,798  
   3. Colombia 7,186       Spain  48,928  
   4. Peru 5,490     4. Brazil  86,675  
   5. Mexico 4,658     5. Colombia  68,067  
   6. United States 3,662     6. Korea, Republic  of 54,310  
   7. Argentina 2,935     7. Mexico  48,178  
   8. Brazil 1,553     8. Panama  43,133  
   9. Panama 1,106     9. Japan  42,622  
   10. Guatemala 523    10. Peru  32,404  
10. Cotton  21. Electric machinery   
   All trading partners 0    1. United States 436,285 
11. Other agricultural products n.e.s.      2. China 407,414 
   1. Peru 12,253     3. EU (28) 144,665 
   2. United States 5,005       Germany 29,841 
   3. Colombia 2,270       Italy 28,169 
   4. EU (28) 1,912       Spain 25,630 
     Spain 522    4. Mexico 98,992 
     Netherlands 464     5. Colombia 65,701 
     France 292    6. Hong Kong, China 59,750 
   5. China 1,405     7. Brazil 49,776 
   6. Brazil 1,134     8. Panama 38,826 
   7. Sri Lanka 473     9. Malaysia 38,168 
   8. Chile 363    10. Korea, Republic  of 22,914  
   9. Guatemala 252  22. Transport equipment   
   10. India 229    1. Japan  122,155  
     2. China  119,961  
     3. Korea, Republic  of 117,682  
     4. United States  108,857  
     5. Colombia  79,097  
     6. Thailand  77,920  
     7. Mexico  50,413  
     8. EU  (28) 43,199  
       Germany  12,934  
       Spain  12,422  
       Netherlands  5,615  
     9. Brazil  19,319  
     10. Indonesia  14,025  WT/BOP/S/18 
 
- 30 - 
 
   Value  
(US$ 1,000)  Value  
(US$ 1,000) 
  23. Non-agriculture articles n.e.s. 
     1. United States  183,021  
     2. China  141,442  
     3. EU  (28) 98,765  
       Germany  36,732  
       Italy  12,241  
       Netherlands  11,063  
     4. Colombia  89,701  
     5. Panama  21,447  
     6. Hong Kong, China  17,894  
     7. Brazil  13,740  
     8. Mexico  12,696  
     9. Korea, Republic  of 10,850  
     10. Chinese Taipei  8,132  
  24. Petroleum   
     All trading partners  0 
a The Plurinational State of Bolivia, as a less developed LAIA country, was excluded from the measure. 
b Paraguay, as a less developed LAIA co untry, was excluded from the measure. 
Source: WTO estimates, based on information provided by the authorities of Ecuador. 
78.  Table 12 provides a weighted average estimate of the possible impact effect of Ecuador's 
measure on the value of imports of its 10 top trading partners, based on 2014 import values. As 
expected, the largest value effects are on Ecuador's five main sources of imports, the United States, China, the EU, Colombia and Panama . The share of total imports affected by value 
is close to the world average (30.3%) for most of the 10 largest sources of imports; however, it is 
slightly higher than average for Peru, and lower th an average for Japan and the Republic of Korea. 
Table 12 Ecuador, value of trade affected by  the surcharge by main trading partner and 
share of total imports 
Trading partner Value of imports affected (thousands of US$)  Share of total imports  
United States 2,647,694 30.2 
 China  1,086,019 30.3 
 European Union 906,016 30.0 
 Colombia  670,404 30.4 
 Panama  425,772 30.1 
 Peru  321,685 31.4 
 Mexico  292,548 30.3 
 Korea, Republic of  271,268 29.9 
 Brazil  263,605 30.5 
 Japan  171,292 29.8 
Source: WTO estimates, based on information provided by the authorities of Ecuador. 
79.  Also concentrating on the effects of Ecuador's 10 main trading partners, Table 13 gives an 
account of how the nature and dispersion of th e surcharge affects them. Weighted averages for 
the applied tariff have been calculated for each of these 10 trading partners (including preferences) and then recalculated including the ta riff surcharge. The table also allows comparison 
with world averages in each case. The import weighted average MFN tariff increases from 8.9% to 
17.8% with the surcharge; that is, it exactly doubles considering trade with all trading partners. Among the 10 main trading partners, the highest weighted averages with the surcharge are faced 
by Japan (25.3%) and China (21.4%), and the lowest  by Peru and Colombia, due to the fact that 
imports before the surcharge were duty-free. However, as a consequence of the surcharge, imports form these two countries now face a weighted average tariff of 9.5% and 9.8%, respectively.  WT/BOP/S/18 
 
- 31 - 
 
  Table 13 Ecuador, weighted average tariff face d by the 10 main trading partners before 
and after the surcharge 
Trading partner Weighted average tariff without 
surcharge Weighted average tariff with 
surcharge 
World 8.9 17.8 
 United States 7.0 13.9 
 China  10.2 21.4 
 European Union 8.5 17.9 
 Colombiaa 0.0 9.8 
 Panama  7.6 15.6 
 Perua 0.0 9.5 
 Mexicob 8.5 18.7 
 Korea, Republic of  9.4 19.0 
 Brazilb 4.6 13.9 
 Japan  11.9 25.3 
a Takes into account 100% Andean preference. 
b Takes into account LAIA preference. 
Source: WTO estimates, based on information provided by the authorities of Ecuador. 
5.2.4  Fiscal effect of the surcharge 
80.  With respect to the possible fiscal effect of the surcharge, there are two opposite effects 
triggered by the measure. On one side, the higher tariff (including the surcharge) may be seen as 
an extra source of revenue by increasing the taxation level per unit imported. On the other side, the higher price of imports due to the surcharge will trigger a substitution effect for similar 
domestic products, which will reduce imports an d hence tariff revenue. The net additional revenue 
effect due to the surcharge will depend on the balance between these two contrasting effects. 
81.  The degree of import substitution due the surc harge will depend on the elasticity of demand of 
the different products. The higher the elasticity of demand, the higher the substitution effect. In 
the particular case of the Ecuador measure, some of the higher 45% rates have been placed on 
goods which the authorities considered had a higher elasticity of demand, such as agricultural products that are also domestically-produced or clothing items, where there is likely to be a 
substitution effect and hence, lower imports. The net revenue effect will depend on how important 
this substitution effect is with respect to the increase in revenue per unit imported due to the application of the surcharge on the level of imports after the surcharge. WT/BOP/S/18 
 
- 32 - 
 
  Appendix Table A1 Ecuador Operations of  the Non-Financial Public Sector, 2009-14  
(% of GDP) 
Transaction/Period 2009  2010  2011  2012  2013 2014  
              
Total revenue 29.4 33.3 42.4 39.5 39.4 38.8 
  Oil revenue 8.3 11.3 17.4 13.9 12.1 10.8  
   Exports 8.3 11.3 17.4 13.9 12.1 10.8 
  Non-oil revenue 19.8 20.1 22.7 22.6 24.0 23.8  
   VAT 5.3 5.4 5.8 6.2 6.4 6.3 
   ICE 0.7 0.8 0.9 0.8 0.8 0.8 
     Income 4.0 3.4 4.0 3.8 4.1 4.1 
      Import tariffs 1.5 1.7 1.6 1.4 1.4 1.3 
      Tax on credit operations in 
national currency 0.0 0.0 0.0 0.0 0.0 0.0 
      Social Security contributions 3.3 3.7 5.3 5.4 4.8 4.7 
      Others 5.0 5.2 5.0 5.0 6.4 6.5 
Non-Financial Public 
Enterprises' operational surplus 1.3
 1.9 2.4 2.9 3.4 4.2  
       
Total Expenditure 33.0  34.7 44.1 40.4 44.0 44.1  
Current expenditure 22.3 24.3 30.8 27.9 28.6 28.8 
      Interests 0.6 0.6 0.8 0.7 1.0 1.0 
            External 0.5 0.5 0.7 0.6 0.8 0.8 
            Internal 0.0 0.1 0.1 0.1 0.3 0.2 
      Salaries 9.5 9.8 10.6 9.5 9.4 9.4 
      Goods and services 3.1 3.0 3.7 4.0 4.7 5.3 
      Other 9.2 11.0 15.8 13.7 13.4 13.1 
Capital expenditure 10.7  10.4 13.3 12.5 15.5 15.3  
      Gross fixed capital 
formation 10.1 9.4 12.8 11.8 14.9 13.9 
          Central Government 5.6 5.3 7.5 7.1 9.0 8.2 
           Non-Financial Public 
Enterprises 2.7 2.1 3.0 2.9 4.2 4.2 
           Local Government 1.6 1.7 2.2 1.8 1.6 1.4 
           Other 0.2 0.3 0.1 0.1 0.0 0.0 
      Other capital expenditure 0.6  0.9 0.5 0.7 0.6 1.4  
Global Result -3.6 -1.4 -1.8 -0.9 -4.6 -5.3 
Primary Balance  -3.0  -0.7 -1.0 -0.2 -3.6 -4.3  
Source: Central Bank of Ecuador. Viewed at: 
http://contenido.bce.fin.ec/documentos/Estadisticas/SectorFiscal/OperacionesSPNF/OperSPNF_PIB.x
lsx. WT/BOP/S/18 
 
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  Appendix Table A2 Ecuador Balance of Pa yments 2009-14, analytical presentation 
Transaction/Period 2009  2010  2011  2012  2013 2014  
              
Current Account 309.4  -1,586.2  -402.4  -163.8  -984.2 -601.7  
Goods 143.6  -1,504.0  -302.6  49.9 -492.5 -67.2  
   Exports  14,412.0 18,137.1 23,082.3 24,568.9 25,685.7 26,604.5 
   Imports  -14,268.4  -19,641.1 -23,384.9 -24,518.9 -26,178.2 -26,671.7 
Services  -1,281.8  -1,522.4  -1,562.7  -1,391.1  -1,495.3 -1,219.3  
  Services provided 1,336.5 1,472.2 1,587.5 1,807.2 2,029.0 2,333.9 
    Transport 345.5 359.8 398.9 411.9 423.5 424.7 
    Travel 670.1 781.3 843.4 1,032.5 1,246.2 1,482.1 
     Other services  320.9 331.1 345.2 362.8 359.4 427.1 
  Services received -2,618.3 -2,994.7 -3,150.2 -3,198.4 -3,524.3 -3,553.2 
    Transport -1,369.2  -1,716.2 -1,761.7 -1,708.4 -1,773.4 -1,782.7 
     Travel -548.7 -568.1  -593.7 -610.6 -621.4 -632.4 
     Other services  -700.5 -710.4 -794.9 -879.4 -1,129.5 -1,138.1 
Income  -1,274.1  -1,040.8  -1,259.5  -1,302.7  -1,395.2 -1,579.3  
  Income inflows 199.1 77.7 84.5 105.3 112.6 118.0 
    Remuneration of employees 6.9 7.5 8.2 9.3 9.3 10.7 
   Investment income 192.2 70.2 76.3 96.0 103.4 107.2 
  Income outflows -1,473.1 -1,118.5 -1,343.9 -1,408.1 -1,507.8 -1,697.3 
    Remuneration of employees -6.4 -6.9 -7.6 -8.4 -9.8 -11.4 
   Investment income -1,466.7 -1,111.6 -1,336.3 -1,399.7 -1,498.0 -1,685.8 
    Direct investment -837.7 -546.2 -700.9 -675.6 -683.9 -665.9 
    Portfolio investment -65.5 -64.3 -61.5 -64.0 -63.7 -143.2 
    Other investment -563.6 -501.1 -573.9 -660.0 -750.4 -876.7 
Current Transfers  2,721.6  2,481.0  2,722.4  2,480.2  2,398.8 2,264.1  
  Inflows 3,033.1 2,927.7 2,984.8 2,756.6 2,702.5 2,727.0 
   General Government 193.1 233.1 225.3 207.0 177.3 189.1 
   Other sectors 2,840.0 2,694.6 2,759.5 2,549.5 2,525.2 2,537.8 
    Workers remittances 2,735.5 2,591.5 2,672.4 2,466.9 2,449.5 2,461.7 
    Other current transfers 104.5  103.1 87.1 82.6 75.7 76.1 
  Outflows -311.5 -446.7 -262.3 -276.4 -303.7 -462.9 
   General Government -8.5 -36.4 -3.7 -4.2 -10.8 -47.0 
   Other sectors -303.1 -410.3 -258.6 -272.2 -292.9 -415.8 
Capital and Financial Account  -2,712.3  479.1  453.2  -515.6  2,959.8 394.3  
Capital Account 73.7  85.9 82.3 121.5  66.1 66.8  
  Capital transfers, inflows 84.9  96.6  92.7  132.3  76.9  77.6  
   General Government 57.4  70.8  68.3  107.8  54.3  53.9  
   Other sectors 27.4  25.8  24.5  24.5  22.6  23.7  
     Acquisition of non-produced 
non-financial assets -11.2  -10.7  -10.4  -10.8  -10.8  -10.8  
Financial Account -2,786.0  393.3  370.9  -637.1  2,893.6  327.6  
  Direct investment 307.9  165.5  643.8  584.9  730.9  773.9  
  Portfolio investment -3,141.5  -731.1  41.0  66.7  -909.8  1,500.4  
   Assets -152.1  -720.9  47.6  138.7  -903.5   -491.8  
   Liabilities -2,989.4  -10.2  -6.6  -72.0  -6.4  1,992.2  
    Capital securities 2.4  0.4  2.0  4.6  2.2  0.8  
    Debt instruments -2,991.9  -10.6  -8.6  -76.6  -8.6  1,991.4  
    Other investment  47.7  958.8  -313.9  -1,288.7  3,072.6  -1,946.7  
    Assets -1,452.5  248.0  -2,496.6  -1,592.3  -1,084.8  -5,206.8  
      Commercial credits  -552.5  -618.3  -711.4  -778.7  -1,485.9  -1,575.6  
      Cash and deposits -375.5  775.3  -1,103.7  -418.5  -1,856.9  -3,632.3  
      Other assets  -524.5  91.1  -681.5  -395.2  2,258.0  1.1  
    Liabilities 1,500.2  710.8  2,182.7  303.7  4,157.4  3,260.1  
      Commercial credits 1,311.0  0.4  583.1  -428.0  1,412.4  662.7  
       General Government 799.3  -499.3  532.4  -495.1  1,362.7  662.7  
       Other sectors 511.7  499.7  50.7  67.1  49.7  0.0 
     Loans 256.1  734.0  1,600.3  658.5  2,768.6  2,570.0  WT/BOP/S/18 
 
- 34 - 
 
  Transaction/Period 2009  2010  2011  2012  2013 2014  
       Monetary authorities -0.6  -0.6  -0.3  -0.3  -0.3  -0.3  
       General Government 683.1  1,175.3  1,405.4  794.3  2,129.3  1,745.6  
       Banks -2.0  87.6  -65.4  29.7  -75.2  -18.5  
       Other sectors -424.4  -528.3  260.6  -165.2  714.7  843.2  
     Cash and deposits -66.9  -23.6  -0.7  73.2  -23.5  27.3  
      Monetary authorities 21.7  -17.7  18.3  65.6  -67.0  -11.4  
      Banks -88.6  -6.0  -19.1  7.6  43.5  38.7  
Errors and Omissions -244.2  -105.2  221.1  97.4  -129.6  -217.1  
              
Overall Balance of Payments -2,647.2  -1,212.3  272.0  -581.9  1,845.9  -424.5  
              
   Reserve assets 681.0  1,170.0  -335.6  475.1  -1,878.0  411.5  
    Monetary gold -183.9  -268.6  -106.0  -109.3  379.1  558.6  
    SDRs -0.5  1.8  1.8  -1.1  -3.7  2.0  
    IMF reserve position  -0.5  0.5  -17.4  -0.0  -0.1  2.6  
    Foreign exchange 865.2  1,459.2  -210.3  1,128.4  -2,619.0  -149.2  
    Other assets 0.7  -22.9  -3.6  -542.9  365.7  -2.5  
   Use of IMF credit 0.0 0.0 0.0 0.0 0.0 0.0 
   Financing 1,966.2  42.3  63.6  106.8  32.1  13.0  
    Debt forgiveness 1,972.6  19.5  16.4  16.4  18.8  20.0  
    Arrears accumulation  24.6  23.7  47.7  114.9  37.0  15.0  
    Arrears cancellation -31.1  -0.9  -0.5  -24.5  -23.7  -22.0  
Financing 2,647.2  1,212.3  -272.0  581.9  -1,845.9 424.5  
Source: Central Bank of Ecuador. Viewed at: 
http://contenido.bce.fin.ec/documentos/Estadisticas/SectorExterno/BalanzaPagos/boletin50/2_BdPAnalitica.xls. 
 
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