Ecuador’s country risk is close to the level before the 2023 sectionals, among the reasons are the rapprochement with the United States, which the IMF confirmed progress towards an agreement and better crude oil prices.
Since February 5, 2023, the country went to the sectionals with 1,120 risk points and after the triumph of Correism as the first political force and the no vote in the referendum the next day, this indicator rose to 1,415 points. From that point, the risk escalated in the midst of the cross death, the early elections of assembly members and president of the first and second round. The country risk was at 2,055 points on January 1, 2024 and now at the door of the popular consultation, at 1,141 points. This implies that it has been reduced by 914 points so far this year.
In the last week, the drop in country risk is thanks to two factors: the upcoming agreement with the International Monetary Fund (IMF) and a better price of crude oil. However, it is evident that there will be variations in the indicator depending on the results of the popular consultation, which will be held this Sunday, April 21.
This is something very positive for investors since it provides a guarantee of responsibility in the fiscal management that the country currently has. Additionally, we have seen the increase in the price of crude oil and the income of tax resources is beginning to be felt. All of this generates a safer fiscal outlook.
The slight rise in the price of crude oil due to the conflict in the Middle East also gives respite to investors who want to invest in Ecuador. On the other hand, the diplomatic impasse between Ecuador and Mexico has had minimal repercussions, since the country risk only rose 17 points.
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