Ecuador: From Chaos to Sustained Growth
A nation that is reclaiming its future one decision at a time
For many years, Ecuador lived under a powerful illusion. It was the tranquil country of the Andes and the Pacific where tourists marveled at rainforests, its retirees settled in cobbled colonial towns like Cuenca, and biodiversity flourished.
It was, as many called it, an island of peace in Latin America.
But beneath this image of calmness, tectonic pressures were building.
In 1999, Ecuador’s financial system collapsed. Banks failed. Families lost their savings. And the country had to abandon its currency, the Sucre, and instead adopt the U.S. dollar. Dollarization brought short-term monetary stability, but over time it exposed the economy to some unintended consequences: easy money laundering, corruption, and weakened financial oversight.
Across the northern border Colombia’s drug trade was expanding and Ecuador— with its growing port infrastructure, limited maritime control, and the closure of the U.S. military base in Manta in 2009—became an ideal transit hub.
The same banana containers that carried Ecuador’s pride abroad were now being contaminated by transnational criminal organizations.
A slow-motion collapse followed: corruption and gang wars erupted in coastal cities, homicide rates soared to unprecedented levels; the island of peace was vanishing along with investor confidence, public trust, and international credibility.
By 2023, Ecuador reached a constitutional crisis. With Congress and the Executive locked in gridlock, and society was consumed by fear, the President activated a drastic provision: muerte cruzada (i.e. mutual dissolution).
Both the legislative and executive branches were dissolved. Early elections were called. A new course had to be chosen.
At that pivotal moment, the country turned not to a seasoned politician but to a young businessman with a familiar name and a different tone.
The Unexpected Leader Daniel Noboa Azin
Son of a business magnate, Daniel Noboa grew up immersed in Ecuador’s most global industry: bananas. But unlike his predecessors, he brought with him the mindset of a new generation—educated abroad, forged in enterprise, and determined to modernize governance with results, not rhetoric.
When he took office in late 2023, Ecuador wasn’t just wounded,it was paralyzed.
His first move? Declare war: not on a country, but on an invisible enemy: organized crime.
Noboa classified narco-trafficking and GDOs (Organized Crime Gangs) as enemy of the state and declared an internal armed conflict, unlocking constitutional powers for the military and police to reclaim territories overrun by gangs. He reformed the penal system, eliminated early-release privileges for hardened criminals, and went after the money—not just the bullets—behind the violence.
Restoring Economic Confidence
Security was only half the equation. To rebuild a country, confidence had to return to households, to boardrooms, and to international forums.
Noboa’s team opened dialogue with Ecuador’s productive sectors, restarted key infrastructure projects, and restructured major public-private partnerships. Internationally, the administration re-engaged with allies and accelerated trade negotiations with investment guarantees.
Gradually, the markets began to respond.
A Mandate Renewed: 2025–2029
In 2025, just over a year into his presidency, Ecuadorians re-elected Noboa with a strengthened legislative majority, an extraordinary political statement in a country weary of broken promises.
This second term is not about triage. It is about transformation:
• Making Ecuador digital, competitive, and connected
• Prioritizing youth employment and 21st-century skills
• Upgrading infrastructure—roads, grids, ports—through innovative financing
• And above all, building institutions that outlast any single administration
The Signs of Recovery: “2025 marks the beginning of a sustained economic rebound.”
The numbers begin to tell a story of healing:
• In 2024, GDP contracted by 2%, dragged down by blackouts due to droughts and lakc of investment in electricity industry and global shocks But by Q4, green shoots appeared:
• Consumption: +1.5%
• Exports: +2.6%
• Investment: +3.0%
• Inflation? Just 0.3%—one of the lowest rates globally Monetary policy is sterile
• And for 2025, the Central Bank predicts 2.8% growth; the IMF forecasts up to 4.0%
For the first time in years, Ecuador’s economy is not just reacting—it’s advancing.
A New Investment Horizon for Canada
Mining and Private Public alliances
Ecuador holds some of the most promising mineral reserves in the region, yet only two large-scale mines are in operation. The government is not rushing—it is demanding environmental standards, Indigenous consultation, and full transparency.
Major infrastructure projects are being evaluated with a strong alliance with the CCC (Canadian Comercial Corporation) a crown company that specializes to provide government to government aliances with Canadian private companies
Trade & Industry
The Free Trade Agreement with Canada, now nearing ratification, reflects Ecuador’s commitment to rules-based trade. It includes arbitration clauses and investor protections designed to restore trust and reduce risk.
The country is betting on:
• Supply chain relocation
• Value-added production
• Strategic partnerships with responsible investors
In short: Ecuador wants smart growth—not just fast capital.
Working with the World
Noboa’s government is not trying to go it alone. It is working with multilateral allies, not against them:
• With the IMF, to balance fiscal discipline and social inclusion
• With the World Bank, to strengthen infrastructure
• With the UN, to embed sustainability across sectors—from mining to migration
These partnerships aren’t cosmetic. They are part of a deeper strategy to align Ecuador with global standards while protecting national priorities.
The Road Ahead
The road is still steep. Violence hasn’t vanished. Energy gaps remain. Public institutions need deeper reform. But the country has crossed a critical threshold:
• It no longer tolerates excuses
• It has stopped waiting for rescue
• It has started rebuilding from within
What once was a story of fragility is now a story of determination.
What once was chaos is becoming a story of success
“After the 2024 contraction, Ecuador is set to rebound by up to 4% in 2025.”
“From instability, a new model of governance and prosperity emerges.”
About the Author
Esteban Crespo Polo, Ecuador's Ambassador to Canada, is an economist with experience in the country's private sector and holds master's degrees from the Pontificia Universidad Católica de Chile and Vanderbilt University in the U.S.