Ecuador

Market overview

The World Health Organisation (WHO) has positioned Ecuador as one of the worst affected countries in the region for the rate of infection, and fatality rate from COVID-19. The Government has responded to the COVID-19 crisis with a series of quarantine measures to protect the population and support the economy. These include closing schools and universities, public spaces and non-critical commercial activities, halting public transport, and imposing curfew.

Ecuador closed its borders on the 18th March. Due to the situation of the Guayas Province (75% of all confirmed COVID-19 cases in the country), the Government requested the joint command of the armed forces to manage the province as a zone of national security, with the objective to enforce confinement measures. Guayas has the highest rate of unemployment in Ecuador in relation to its population and this makes the situation especially challenging, as most of the population depends on informal work.

It has been difficult for many Ecuadorians to follow the quarantine measures. It is estimated that 400,000 Ecuadorian families derive their income through selling goods on a day-to-day basis. One of the measures to alleviate the economic losses is the introduction of US$120 contingency bonus for these families and the delivery of food rations and necessities.


Government support

President Moreno has announced a series of fiscal tightening measures to counter the sharp fall in oil prices. The President said that the crisis has "hit Ecuador hard" because "8 million dollars in income are being lost daily", due to the decreasing oil revenues.

This fiscal package includes revenue-enhancing measures as well as expenditure cuts of about 2.5% of GDP with respect to the 2020 original budget, and some 2.5% of GDP in new financing and refinancing of some current obligations.

These measures focus on a reduction of state spending, a tax on vehicles, a contribution from public sector workers and decreasing foreign debt, amongst other fiscal decisions. The measures will not include elimination of gasoline subsidies nor an increase in taxes for lower income population.

The World Bank has approved a US$20 million loan for managing the COVID-19 pandemic in Ecuador. The funds will be oriented to strengthen the national public health system through the procurement of medical supplies needed to treat COVID-19 cases and the equipping of a larger number of intensive care and isolation units. Additionally, the funds will contribute to finance the national communication strategy and the dissemination of prevention and protection messages for the short and medium term.

The Government has also enacted the following tax relief package:

  • Payment of corporate income tax for fiscal year 2019 and VAT for the months of April, May, and June 2020 can be deferred and paid in six instalments by certain taxpayers.

  • A regime for "self-withholding" of income tax at a rate of 1.75% of monthly taxable income has been established for financial entities and mobile phone service providers.

  • A "self-withholding" income tax at a rate of 1.5% of monthly taxable income has been established for entities involved in exploration and exploitation of non-renewable resources and hydrocarbons, including entities that transport crude oil.

  • An extension of certain tax formal obligations and compliance deadlines.


Additional resources

Below you can find information and contact details for other New Zealand government and international agencies regarding their response to COVID-19.

New Zealand Government agencies

Covid19.govt.nz
COVID-19 helpline for businesses
Business.govt.nz
New Zealand Customs
Ministry for Primary Industries (MPI)
New Zealand Export Credit (NZEC)
MFAT Export Helpline
MFAT Safetravel
Callaghan Innovation
Immigration
Ministry of Health
WorkSafe New Zealand

Global agencies

World Health Organization (WHO)
Centers for Disease Control and Prevention (CDC)

Contact NZTE

We're available to talk to you about any issues your export business is facing due to COVID-19.

For existing NZTE customers, please contact your New Zealand-based Customer Manager.

If you're unsure who to contact or haven't worked with us before, you can call NZTE on 0800 555 888 or email below and one of our Customer Advisors will help you.