Ecuador Fact File - General Information

Where in the world is it?

Western South America, bordering the Pacific Ocean at the Equator, between Colombia and Peru. Ecuador also owns the famous Galapagos Islands, located approximately 1,000 kilometers off the coast. Ecuador covers 256,370 square kilometers of land and is the smallest country in South America after Uruguay and the Guyanas.

What can you do in Ecuador?

- Study Spanish
- Climbing and hiking
- Rafting and kayaking
- Horseback riding
- Birdwatching
- Mountain biking
- Scuba diving
- Festivals
- Indigenous markets
- Museums, galleries, cultural events
- Volunteer work
- Galapagos Islands - whalewatching, scuba diving, snorkeling, more

One of the best things about Ecuador is its climate:

Because of its location directly atop the equator, Ecuador is an excellent travel destination year-round. There are just two seasons in Ecuador: wet and dry. Because of the high elevation of the central Andes region, temperatures are cooler than you might expect. In Quito the temperature ranges from 7 degrees C (55 F) at night, to 26 C (78 F) at noon, averaging a delightful 15 C (64 F). Because of its mild weather, Ecuador is often called 'Land of Eternal Spring.'

Geography

Despite Ecuador's diminutive size - about equal to the state of Colorado - it is one of the most geographically diverse countries in the world. Ecuador is comprised of four distinct geographical regions: El Oriente (Amazon jungle) in the east, La Sierra (Andes mountains) in the center, La Costa (the Pacific coastal lowlands) in the west, and the majestic Galapagos Islands off the coast.

Elevation extremes:
lowest point: Pacific Ocean 0 m
highest point: Chimborazo 6,267 m

Government: Democratic Republic (President: Gustavo Noboa Bejarano) Elections take place in the Fall, 2002.

Area: 256,370 sq. kilometers

Population: 12.4 million

Capital City: Quito (population 1.3 million)

Principal cities: Quito, Guayaquil (1.5 million), Cuenca (250,000)

Official language: Spanish

Currency: U.S. Dollar

Natural resources: petroleum, fish, timber, hydropower

Land use:
arable land: 6%
permanent crops: 5%
permanent pastures: 18%
forests and woodland: 56%
other: 15% (1993 est.)

Literacy:
definition: age 15 and over can read and write
total population: 90.1%
male: 92% female: 88.2% (1995 est.)

Indigenous groups: over 40 indigenous nations.

Languages: Spanish (official), numerous indigenous tongues. English is commonly spoken among professionals and tourism providers.

Religion: 95% Roman Catholic, however most mestizos and indigenous converts combine Catholicism with animistic practices and beliefs.

Infrastructure:

- Internet Service Providers: 27
- Internet dial-up accounts: 39,700
- PC ownership: 3.9 per 1,000
- Cable TV subscribers: 78,200
- Main phones lines: 906,000; Per 100: 7.3
- Cellphone subscribers: 449,000; Per 100: 3.6
- Roads paved: 18.9% (1999)

Economy overview:

Ecuador has substantial oil resources and rich agricultural areas. Because of primary export products such as oil, bananas, and shrimp, fluctuations in world market prices can have a substantial domestic impact. In recent years, growth has been uneven due to ill-conceived fiscal stabilization measures. The aftermath of El Niño and depressed oil market of 1997-98 drove Ecuador's economy into a free-fall in 1999. The beginning of 1999 saw the banking sector collapse, which helped precipitate an unprecedented default on external loans later that year. Continued economic instability drove a 70% depreciation of the currency throughout 1999, which eventually forced a desperate government to dollarize the currency regime in 2000. The move stabilized the currency, but resulted in the ouster of then-President Mahaud and the appointment of Gustavo Noboa as president.

- GDP: 12.7 billion
- GDP real growth rate: -2%
- GDP per capita: $950
- Inflation rate: 51.7% (2000)
- Labor force: 3.4 mill
- Unemployment rate: 11.9% with widespread underemployment (1998)
- Poverty (% of population below national poverty line): 35%
- Main industries:
- Oil, mining, food processing, textiles, metal work, paper products, wood products, chemical production, plastics, fishing, lumber, tourism.

Main agriculture products:

Bananas, coffee, cacao, rice, fish, shrimp, potatoes, manioc, plantains, sugarcane, cattle, sheep, pigs, beef, pork, dairy, balsa.

Where in Ecuador are expats choosing to live?

Generally, most expats living in Ecuador live in and around Quito and the Andean highlands near the communities of Ibarra, Otavalo, Latacunga and in and around the colonial-style cities of Cuenca and Vilcabamba. Some are settling in beach communities near Manta and Crucita where oceanside condos are currently approx. $45,000. In the cities, many people are purchasing apartments or condos at prices ranging form $30,000 to $100,000. Asking price for larger homes (5 bedroom, 5 baths, swimming pool and garden, etc.) is generally $150,000 - $200,000. A couple of IL subscribers have purchased large acreages of ranch or farmland. One subscriber utilized local artisans and craftsmen to build a home in 2000 on the grounds of a restored hacienda near San Pablo del Lago for $27,000. The. adobe-style home features a kitchen, living room and dining area, a master bedroom with full bath and a second-story office complete with satellite TV. An adjacent guest suite accommodates two double beds and a full bath. The subscriber predicts that if he were to build the house today, his costs would be approximately 20% higher.

Dollarization and stability

In 1999, Ecuador underwent its worst economic crisis in history as a result of a combination of external shocks (drop in oil prices, the effects of phenomenon of 'El Niño,' the Asian and Brazilian financial crisis), and the slow pace of reforms due to political deadlock.

GDP plummeted by 7.3%, a banking meltdown resulted in 60% of Bank assets in the hands of the State, despite some drastic measures such as a mandatory banking holiday of one week and an ensuing freezing of deposits, and the national currency (the Sucre) in effect collapsed. Ecuador defaulted on its external debt and the economic situation deteriorated rapidly, without an Agreement with the international financial institutions.

In 2000, the Noboa Administration was able to turn things around and swiftly implement an economic program aimed at regaining stability. The country adopted the dollar as its official currency at the start of 2000. The sucre and the dollar were permitted to circulate simultaneously for a period of one year. The official conversion rate was fixed at 25,000 sucres to the dollar during the transition period. Despite minor glitches, such as an initial lack of small change and low-denomination bills, the process proceeded remarkably smoothly. By the beginning of 2001, over 98% of transactions were being conducted in dollars and familiarity with the new currency was widespread throughout the country.

In April 2000, Ecuador reached a Stand-by Agreement with the IMF that unlocked US$ 2 billion in loans from the international financial institutions to Ecuador in three years. In August 2000, Ecuador's private international creditors overwhelmingly accepted the offer to exchange Euro and Brady bonds for Global bonds with a 40% discount from the nominal value.

Dollarization has led to a marked deceleration in inflation. Inflation fell from an annual rate of 96.1% in 2000, to approximately half that in April 2001. Preliminary monthly inflation in May 2001 was just 0.2%, indicating that the rate of inflation will likely continue to fall throughout 2001. Some economists predict the inflation rate will be less than 10% in 2002.

The economic indicators for 2003 have improved dramatically, with a projected GDP growth of 5% and inflation around 30%, in a downward trend. A major contribution to growth is the investment in excess of US$ 1 billion by 5 multinationals from the U.S., Canada, Spain, Argentina and Italy, to build and operate a heavy crude oil pipeline in Ecuador. The pipeline will allow Ecuador to double its oil exports when it becomes operational, at the beginning of 2004.

For more detailed information about Ecuador, including the entire scoop on living, working and investing here, read Ecuador: The Owner's Manual