ecuador economic development position
TRANSCRIPT
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Ecuador:
AnexaminationofitscurrentpositionrelativetotheMillenniumDevelopmentGoals
JasonFischer
5/5/2011
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ContentsIntroduction.................................................................................................................................................. 3
Goal1:EradicatingExtremePovertyandHunger........................................................................................ 6
TargetsandMeasures............................................................................................................................... 6
CurrentStatus........................................................................................................................................... 7
Recommendations.................................................................................................................................... 8
Goal2:AchievingUniversalPrimaryEducation............................................................................................ 9
TargetsandMeasures............................................................................................................................... 9
CurrentStatus......................................................................................................................................... 10
Recommendations.................................................................................................................................. 10
Goal3:PromotingGenderEqualityandEmpoweringWomen.................................................................. 11
Targetsand
Measures
.............................................................................................................................
11
CurrentStatus......................................................................................................................................... 11
Recommendations.................................................................................................................................. 12
Goal4:ReducingChildMortality................................................................................................................ 12
TargetsandMeasures............................................................................................................................. 12
CurrentStatus......................................................................................................................................... 13
Recommendations.................................................................................................................................. 13
Goal5:ImprovingMaternalHealth............................................................................................................ 14
TargetsandMeasures............................................................................................................................. 14
CurrentStatus......................................................................................................................................... 14
Recommendations.................................................................................................................................. 15
Goal6:CombatingHIV,AIDS,Malaria,andOtherDiseases....................................................................... 15
TargetsandMeasures............................................................................................................................. 15
CurrentStatus......................................................................................................................................... 17
Recommendations.................................................................................................................................. 17
Goal7:
Ensuring
Environmental
Sustainability
...........................................................................................
18
TargetsandMeasures............................................................................................................................. 18
CurrentStatus......................................................................................................................................... 18
Recommendations.................................................................................................................................. 19
Goal8:DevelopingaGlobalPartnershipforDevelopment........................................................................ 20
TargetsandMeasures............................................................................................................................. 20
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CurrentStatus......................................................................................................................................... 20
Recommendations.................................................................................................................................. 22
TransnationalIssues.................................................................................................................................... 23
IllicitDrugs.............................................................................................................................................. 23
Political:RelationshipwiththeUnitedStates......................................................................................... 23
Conclusion................................................................................................................................................... 24
CurrentStatus......................................................................................................................................... 24
ProgramRecommendations................................................................................................................... 25
Stage1................................................................................................................................................. 25
Stage2................................................................................................................................................. 26
Stage3................................................................................................................................................. 26
Appendix.....................................................................................................................................................
28
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Introduction
Onlyasmallpercentageofallcountriesintheworldarereferredtoasadvancedordeveloped
countries.
Whatcriterion
is
being
used
to
determine
which
countries
are
superior
to
the
rest?
There
arefivecharacteristicscommonlyfoundindevelopingcountriesthatrestraineconomicdevelopment.
Thesecharacteristicsincludealowlifeexpectancy,lowstandardofeducation,poorhealthcare,high
unemployment,andpoornutritionandlimitedaccesstosafewater. Ecuadorisasmall,lowermiddle
income,SouthAmericancountrycurrentlystrugglingforitsdevelopment.Alowermiddleincome
economyranksincomepercapitaintermsofU.S.dollarsbetween$996and$3,945peryear. Ecuadoris
currentlyworking
to
improve
each
of
the
characteristics
that
classify
it
as
adeveloping
country,
but
thereisstillalargeamountofworkthatneedstobecompletedbeforeanadvancedeconomiclevelcan
beachieved. CountriessuchastheU.S.,Canada,Australia,andJapanhavereachedthisadvanced
economiclevelandcontinuedtoexpandtheeconomyovermanyyears. Ecuadoristhe73rdlargest
countryintheworldbytotalareaandislocatedinWesternSouthAmerica. Ecuadorbordersthe
EquatorandthePacificOcean,betweenPeruandColumbia.1 TheEcuadorianeconomyislargely
dependentonexportsofoil,bananas,shrimp,coffee,fish,andotherpetroleumresources. Their
economicstrengthreliesheavilyonthesuccessoftheirexportsinforeignmarkets.
Deterioratingeconomicperformanceinlate1997andearly1998helpedcreateasevere
financialcrisisinEcuadorin1999. Severalexternalcatalystsin1997and1998contributedtothecrisis
includingtheElNio,significantdropsinglobaloilprices,andinternationalemergingmarketinstability.
El
Nio
is
a
weather
pattern
that
affects
the
area
by
rising
ocean
water
temperatures.
During
the
financialcrisis,EcuadorsGDPcontractedmorethan7%. Thisinturnresultedinalargeincreasein
povertyandacollapseofthebankingsystem. Thecollapseofthebankingsystemresultedinabout70%
offinancialinstitutionsclosing,yearoveryearinflationofover50%,unemploymentlevelsashighas
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14%,andadefaultonexternaldebt. Thedefaultonexternaldebtresultedfroma65%devaluationof
theirnationalcurrency,theSucre. Ecuadorhasatotalof$15billionindebt,$7billioninforeigndebt
and$6billioninEcuadorianBradyBonds. BradyBonds,namedafterU.S.TreasurySecretaryNicholas
Brady,wereusedasasolutioninMarch1989topreventacollapseofthebankingsystem. Ecuadorand
manyotherLatinAmericancountriesparticipatedinthefirstroundofissuanceofBradyBondsbythe
InternationalBankforReconstructionandDevelopment. Aftermanycountriesdefaultedontheir
nationaldebt,BradyBondswereissuedasasolutiontorefinancethebondsoriginallyissuedbythe
defaultingcountries. BradyBondsplayedasignificantroleinthefinancialsurvivalofEcuador
throughoutthe1990sbecauseoftheirguaranteebytheU.S.Treasuryandtheirabilitytobetradedby
investors. In1999,EcuadorianPresidentJamilMahuadannouncedthatEcuadorwouldonlymakehalf
ofthe$98millioninterestpaymentsdueonthebondsanddefaultontheotherhalf. Followingthese
events,EcuadorianofficialsmetwithcreditorstodiscussrestructuringofthecountrysBradyBonddebt.
InMarch2000,EcuadorsNationalCongressapprovedaseriesofstructuralreformsand
providedtheadoptionoftheU.S.dollaraslegaltenderinEcuador. TheadoptionoftheU.S.Dollaras
legal
tender
in
Ecuador
is
referred
to
hereafter
as
dollarization.
Dollarization,
bolstered
by
rising
oil
prices,stabilizedtheeconomyandpositivegrowthreturned.Duringtheperiodfrom2002to2006,the
economygrewatarateof5.5%andthepovertyleveldeclined. However,povertylevelsstillremained
highat38%. Inearly2008,theeconomygrewatarateof6.5%,adirectresultoftheveryhigh
petroleumprices.Again,povertylevelsremainedhighat35%. Inthesecondhalfof2008,Ecuador
defaultedondebtforthesecondtimeinnineyears. Thistimethegovernmentdefaultedon$3.2billion
ofbonds.
Once
again,
Ecuador
faced
economic
uncertainty,
further
discouraging
domestic
and
foreign
privateinvestment. Oilandotherpetroleumresourcesaccountedformorethan40%ofexportearnings
and25%ofpublicsectorrevenuesin2008.2 AsshowninFigure1.1,thepriceofabarrelofcrudeoilwas
thehighestithaseverbeenin2008andwassignificantlyreducedduringtheglobalrecessionin2009.
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Table1.1usesalinearregressionanalysistoshowthecorrelationbetweentheannualaveragepriceofa
barrelofcrudeoilandtheannualGDPperCapitaofEcuadorbetween1982and2010. Ther2valueof
.7967indicatesastrongcorrelationfortheannualdata. Thisfigurecouldindicateanevenstronger
correlationiftheGDPpercapitawasreleasedquarterlyinsteadofjustannually.
CurrenteconomicconditionsinEcuador,relativetotheother227countriesintheworld,are
showninFigure1.2. Figure1.2identifieseconomicfactorsthatneedtobeimprovedbeforefurther
developmentcanoccur. ThesefactorsincludeGDP,unemployment,theamountofdebtoutstanding,
inflation,andincomedistribution. SomeofthesefactorsareaddressedintheMillenniumDevelopment
GoalswhichhavebeenoutlinedbytheUnitedNationsaspartofaglobalactionplantoeliminate
povertyinunderdevelopedcountries.In2000,the192memberstatesoftheUnitedNationsproduced
theMillenniumDeclarationwhichcontaineddetailsoftheMillenniumDevelopmentGoals.The
Declarationsgoalisforeveryindividualintheworldtohaveabasicstandardofliving,freefromhunger
andviolence,andtherighttofreedomandequality.TheMillenniumDevelopmentGoalsareeight
developmentalgoalsthatfocusonincreasinghumancapital,increasinghumanrights,andimproving
infrastructure.
The
eight
goals
are
to
eradicate
extreme
poverty
and
hunger;
achieve
universal
primary
education;promotegenderequalityandempowerwomen;reducechildmortality;improvematernal
health;combatHIV,AIDS,malaria,andotherdiseases;ensureenvironmentalsustainability;anddevelop
aglobalpartnershipfordevelopment. Eachoftheeightgoalshastargetssettomeasureperformance
andtoestablishabenchmarkforachievingsuccess. TheUnitedNationsseta2015targetdateto
achievethesegoals. Inthispaper,IwillexamineEcuadorscurrentpositionrelativetotheeight
MillenniumDevelopment
Goals.
Iwill
also
address
key
transnational
issues
such
as
environmental
issues,illicitdrugs,politicalinstability,andsuggestwaysforfuturedevelopment.
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Goal1:EradicatingExtremePovertyandHungerTargetsandMeasures
Thefirst
Millennium
Development
Goal
is
to
eradicate
extreme
poverty
and
hunger.
There
are
threetargetsthatmeasuretheperformancetowardachievingthefirstgoal. Thefirsttargetstatesthat
Ecuadormusthalve,between1990and2015,theproportionofpeoplewhoseincomeislessthan$1a
day. Themeasuresforthistargetincludetheproportionofpopulationbelow$1(PPP),povertygap
ratio,andtheshareofthepoorestquintileinnationalconsumption.Thesecondtargetistohalve,
between1990and2015,theproportionofpeoplewhosufferfromhunger. Themeasuresforthistarget
includethegrowthrateofGDPperpersonemployed,theemploymentrate,theproportionofemployed
populationlivingbelow$1perday(PPP),andtheproportionoffamilybasedworkersintheemployed
population.Thefinaltargetistoachievefullandproductiveemploymentanddecentworkforall,
includingwomenandyoungpeople. Themeasuresforthistargetincludetheprevalencerateof
underweightchildrenunderfiveyearsofageandtheproportionofthepopulationbelowtheminimum
levelofdietaryenergyconsumption.
Akeyindicatorofpovertyproblemswithinacountrycanbetracedtounequaldistributionof
income. Onemethodofmeasuringinequalityinincomeisbyanalyzingthesizedistributionofincome
withinacountry. Theothermethodisfunctionaldistributionofincome,whichisusedindetermining
howincomeisdividedamongdifferentfactorsofproduction. Thesizedistributionofincomeis
measuredonanindividualbasisbydividingthedataintogroups. Itconsidersindividualpersonsandthe
total
income
that
they
receive.
A
Lorenz
Curve
is
used
to
illustrate
the
quantitative
relationship
betweenthepercentageofincomerecipientsandthepercentageoftotalincometheyreceiveeach
year. Thegraphincludesadiagonalline,representingthelineofperfectequality,whichgaugesthe
equalityofwealthdistributioninacountry. Theareabetweenthelineofperfectequalityandthe
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LorenzcurveisusedtoderivetheGiniCoefficient. GiniCoefficientscapturetheincomeinequalityand
producesvaluesrangingbetween0and1,representingperfectinequalityandperfectequality,
respectively. GiniCoefficientsmaybemisleadingbecauseitmeasuresanarea. Twoverydifferent
lookingLorenzCurvescouldproducethesameGiniCoefficient. Therefore,thebestrepresentationof
incomedistributionistheLorenzCurve.
CurrentStatus
Ecuadorhassucceededinachievingthefirsttarget,tohalve,between1990and2015,the
proportionofpeoplewhoseincomeislessthan$1aday. In1994,theproportionofpopulationliving
below$1(PPP)perdaywasashocking15.9%. By2007,Ecuadorhaddecreasedthisnumbertolessthan
5%. Between1994and2007,thepovertygapratiodroppedfrom6.8%to1.2%andthepoorest
quintilesshareinnationalincomeorconsumptionincreasedfrom3.1%to3.4%.3 Themeasuresforthe
secondtarget,tohalve,between1990and2015,theproportionofpeoplewhosufferfromhunger,are
alsobeingachieved.Figure1.3showsthatbetween1990and2010,thegrowthrateofGDP(PPP)per
person
employed
has
remained
relatively
constant.
The
number
of
people
employed
was
calculated
by
multiplyingtheemploymenttopopulationratio(15+)bythetotalpopulation(15+). Thegrowthrateof
GDP(PPP)iscalculatedbydividingtheGDP(PPP)bytheemployedpopulation. Between1990and2010,
theemploymenttopopulationratiohasincreasedfrom51to61. AccordingtotheUnitedNations
StatisticsDivision,from1994to1998theproportionofemployedpeoplelivingbelow$1(PPP)perday
decreasedfrom20.1%to5.8%.4Since1990,theproportionoffamilybasedworkersintheemployed
populationhas
remained
constant.
Since
the
proportion
of
employed
people
living
below
$1
(PPP)
per
dayhasdecreaseddrasticallyandtheemploymenttopopulationratioandGDPhasincreasedduringthe
sametimeperiod,itisevidentthatEcuadorwillachievethesecondtarget. Thefinaltarget,toachieve
fullandproductiveemploymentanddecentworkforall,includingwomenandyoungpeople,isalso
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closetobeingreached. Theprevalencerateofunderweightchildrenunderfiveyearsofagewas
reducedfrom14.8%to9.4%between1999and2004.Duringtheperiodfrom1991to2005,the
proportionofpopulationbelowtheminimumlevelofdietaryconsumptionwasreducedby11%or1
millionpeople.5
EcuadorscurrentdistributionofincomeisillustratedinFigure1.4. Figure1.4showsthatwealth
wasmostequallydistributedin1995andmostunequallydistributedin2003.Between1995and2003,
Ecuadorexperiencedfinancialconcerns,mostnotably,thedefaultondebtin1999. Duringthisperiod,
GDPbegantoexpandbutpovertystillremainedhigherthanthatexperiencedintheprefinancialcrisis
levels. Thelowest80%ofthepopulationonlycontrolledlessthan35%ofthetotalincome. However,as
seeninFigure1.1Ecuadorisranked31stoutof227countriesintermsoftheGinicoefficient. Figure1.5
showsthechangesintheGiniCoefficientofEcuadorfrom1998to2010. TheGiniCoefficient
experiencedadecreasefrom2000to2003andremainedrelativelystablethereafter. Asawhole,itis
clearthatEcuadorcontinuestoexperiencearelativelyunequaldistributionofwealth. Figure1.6
illustratestheunemploymentrateandtheemploymenttopopulationratio. Theemploymentto
population
ratio
is
the
ratio
of
the
total
working
age
of
the
labor
force
currently
employed
to
the
total
workingagepopulation. Theratiohasshownacontinuedgradualriseeveryyearsince1990.Ecuador
hasalsoexperiencedareductionintheunemploymentrateeveryyearbetween2005and2010.
Recommendations
Thereareafewmethodstoreducingpovertyinacountry. Onemethodofreducingextremely
highpoverty
and
unemployment
rates
is
by
creating
jobs,
new
businesses,
and
wealth
through
the
creationofastrongmicrofinancesector. Peopleshouldbeencouragedtodeveloptheirownmicro
businessestosurvive. Generally,theseentrepreneursstruggletofindgoodfinancialsupportoptions.
Afterthe1999financialcrisis,theUnitedStatesAgencyforInternationalDevelopment(USAID)in
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coalitionwithEcuadorinitiatedaprojectthatwouldhelpbesiegedfinancialinstitutionslendtosmall
businessowners. Between2001and2004,asaresultoftheassistancefromUSAID,theloanportfolioof
financialinstitutionslendingtosmallbusinessesgrewfrom$86millionto$302million.Asaresultofthis
increaseinloandollars,borrowersincreasedfrom105,000to302,000. AccordingtoaUSAIDreport,
Themicroenterprisesectorprovidesjobsforanestimated1,018,135people,or25%oftheurban
workforce;salesfromthesejobstotaled25.7%ofGDP.6 Theincreaseinaidwillcreatenewjobsinthe
alreadysuccessfulmicroenterprisesector.TheassistancefromUSAIDalsohelped21microcredit
institutionssurvivetheperiodafterthefinancialcrisisandbecomeprofitable.7 Anotherpossible
programthatwillhelpreducepovertyistoinvestinresearchforinnovativewaystoincreaseexports
andmaintainastableeconomyduringperiodswhentheirlargestexportsarestrugglinginthemarket.
Thelastrecommendedprogramistosubsidizefarmingneedstohelpincreaseagriculturalproductivity
andrelievethepressureonexportingpetroleumresources.
Goal2:AchievingUniversalPrimaryEducationTargetsandMeasures
ThesecondMillenniumDevelopmentgoalistoachieveuniversalprimaryeducation. Thetarget
istoensurethat,by2015,childreneverywhere,boysandgirlsalike,willbeabletocompleteafull
courseofprimaryschooling. Themeasuresforthistargetincludethenetenrollmentratioinprimary
education;theproportionofpupilsstartinggrade1whoreachthelastgradeofprimary;andtheliteracy
rateof1524yearolds,womenandmen. Theprimaryschoolnetenrollmentratioistheshareof
childrenofofficialprimaryschoolagethatareenrolledinprimaryschool. Thegrossenrollmentratio
inprimaryschoolsistheshareofchildrenofanyagethatareenrolledinprimaryschool. Thegross
enrollmentratiooftenexceeds100%indevelopingcountriesbecauseofadultsthatarestartingto
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receiveaneducationforthefirsttime. Literacyisdefinedashavingtheabilitytoreadandwriteashort,
simplestatementoneverydaylife.
CurrentStatus
EcuadorscurrentstatusforauniversalprimaryeducationisbestrepresentedinFigure1.7.
Figure1.7showsthenetenrollmentratioforgirlsandboys,primaryeducationcompletionrate,and
numberofchildrenoutofprimaryschool. Thenetenrollmentratioforgirlsandboyshasremained
above99%since1998. Theprimaryeducationcompletionratereachedalowof71%in2002buthas
sincerebounded. In2006,themostrecentprimaryeducationdatawasreleasedandshowsthe
completionrateexceeding80%. Figure1.7illustratesthesignificantimprovementsmadeinthe
Ecuadorianeducationalsystemsincethefinancialcrisisended. In1998,therewerearound30,000
primaryagechildrenoutofschoolandjusttwoyearslaterhadbeenreducedby2/3. Itisasignificant
achievementforEcuadortokeepthelevelofoutofschoolchildrensteadyaround10,000,evenas
populationincreasesasaresultofincreasedmigration. Theliteracyrateof1524yearolds,womenand
men,
has
remained
relatively
stable
between
95.5%
and
96.5%
in
recent
years.
In
2001,
Ecuador
financeditseducationexpenditureswith1%oftheirGDP,leavingitranked182ndintheworld.8
EcuadorscurrentpopulationstructureisdepictedinFigure1.8. Figure1.8showsthatEcuadorsage
distributionisheavilyweightedwithpeoplelessthan20yearsofage.
Recommendations
Basedon
this
information,
educational
expenditures
as
apercent
of
GDP
will
need
to
escalate
quickly.Byincreasingtheeducationalexpenditures,Ecuadorwillkeepupwiththeincreasingdemandat
theprimary,secondary,andtertiaryeducationlevelsasthepopulationstrivestoachieveuniversal
education. Ecuadorshouldinvestintheirteachersandgivethemalloftheresourcesthatareneededto
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educatethepopulation. Schoolsshouldbebuiltinlocationsthataccommodatethevastmajorityof
students,inbothruralandurbanareas. Studentswillnotbeinclinedtoattendclassiftheschoolisnot
locatedwithinareasonabledistance. Theotherfactortoconsiderisschoolfeesattheprimaryschool
level. Schoolfeeshavebeenabolishedinmanycountriesandenrollmentrateshavesurged. People
begintotakefreeresourcesandservicesforgranted,oftenshowingadecreaseddemandforthose
resourcesorservices. However,Ecuadoralreadyhasahighenrollmentrateandifthereisasmall
financialobligation,studentsmaybemoreinclinedtoattend.Byestablishingafeeitwillhelpin
accommodatingtheincreasingdemandforclassroomsandteachers. Allofthesefactorsneedtobe
consideredwhenidentifyingtheneed foradditionaleducationalresources.
Goal3:PromotingGenderEqualityandEmpoweringWomenTargetsandMeasures
ThethirdMillenniumDevelopmentgoalistopromotegenderequalityandempowerwomen.
Thetargetissettoeliminategenderdisparityinalllevelsofeducationnolaterthan2015. Todetermine
thelevelofgenderequalitythatisbeingachieved,threemeasureswillbeused. Thesemeasuresinclude
theratioofgirlstoboysinprimary,secondary,andtertiaryeducation,theshareofwomeninwage
employmentinthenonagriculturalsector,andtheproportionofseatsheldbywomeninnational
parliament. Genderequalityisalsomeasuredintermsofemploymentbyeconomicactivity. The
empowermentofwomenwillbemeasuredusingtheproportionofseatsheldbywomeninnational
parliament.
CurrentStatus
ThereisnearperfectequalityinallaspectsofeducationforEcuador. Girlsareslightlysuperior
incohortsurvivalrate,havingagreaterpercentagereachingthelastgradeofprimaryeducation. Girls
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alsoreignsuperiortoboysinattendingprimaryschool. In2006,employmentbyeconomicactivity
showsmenreigningheavilyintheindustrysectorandwomenintheservicesector. However,both
sectorsexperiencedaslightdrawbackandemploymentwasallocatedtothestrengtheningagricultural
sector.9 ThelatterpartofthethirdMillenniumDevelopmentGoalistoempowerwomen. In2000,
whenthegoalswerefirstset,thenumberofseatsheldinnationalparliamentbywomenwas17.4%.
Today,thatnumberhasnearlydoubledaswomenhold32.3%oftheseatsinnationalparliament.10
Recommendations
Thereareanumberofprogramsthatwillfurthergenderequalitythroughoutthecountry. The
underlyinggoalisforwomentohaveequalopportunityinareaswheremencurrentlyholdthemajority.
Althoughthereisnomajordisparityintheeducationsystembetweengirlsandboys,thereisagapin
theworkforce. Ecuadorcancounteractthisinequalitybylaunchingataxincentiveforanybusinesses
thathaveestablishedtrainingandrecruitingprogramsthatrecognizegenderequalityandhaveapay
scalethatisnotbiasedbasedongender. Theincentivewillcomeintheformoftaxcreditswhichwillbe
directly
deposited
into
the
claimants
bank
account.
Another
method
to
empower
women
is
to
set
a
quotaintheelectionbylawsthatrequireafixednumberofseatsinnationalparliamentbesetasidefor
women. Whenimplementingtheserecommendations,itisimportanttoalsoconsiderthecultural
normsofthesocietywithrespecttoreligionandotherculturalvalues.
Goal4:ReducingChildMortality
TargetsandMeasures
ThefourthMillenniumDevelopmentGoalistoreducechildmortality. Thetargetistoreduce
theunderfivemortalityratebytwothirdsbetween1990and2015. Thethreemeasuresthatwillbe
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usedincludeunderfivemortalityrate,infantmortalityrate,andtheproportionofoneyearoldchildren
immunizedagainstmeasles. ThesestatisticswillbemeasuredusingdatafromtheUnitedStatesCensus
InternationalDatabase.
CurrentStatus
AsrepresentedinFigure1.8,itisevidentthatEcuadorisreducingchildmortality. Mortality
ratesper1,000birthshavedecreasedsignificantlybothintermsofinfantsandthoseunderfive.The
currentmortalityratesforinfantsandthoseunderfiveresidearound2%and2.5%,downfrom5%and
6.5%respectively. TheUnitedStatesCensusInternationalDatabasealsoshowsthepercentofoneyear
oldchildrenthathavebeenimmunizedagainstmeasles. Thenumberofoneyearoldchildren
immunizedhasremainedconstantat99%inrecentyears,upsignificantlyfromthelowof54%in1991.
Recommendations
Inrecentyears,thegovernmenthasshownastrongcommitmenttohealthcareandreducing
child
mortality,
which
is
evident
by
the
99%
childhood
immunization
rate.
Studies
by
the
Natural
ResourcesDefenseCouncilshowthatinfantmortalityratescanbereducedthroughbreastfeeding.
Breastfedchildrenarelesssusceptibletodiseasesandinfectionsduringtheearlystagesoflife. They
arealsolesslikelytocontractdiabetes,sclerosis,orcancerbeforetheyreach15yearsofage.11
Between2005and2009,40%ofchildrenwereexclusivelybreastfedforlessthansixmonths. Duringthe
sameperiod,77%ofchildrenwerebreastfedwithcomplementaryfoodfor6to9months. By
implementingaprogram
to
promote
breastfeeding,
there
is
agood
possibility
that
the
percentage
of
childrenbeingbreastfedwillincreaseandalsofurtherreducechildmortalityrates. Inadditionto
reducingchildmortalityrates,itdoublesasaneconomicincentiveforfamilies,allowingthemtoforego
anyexpensesoninfantformula. Anotherprogram,withprovensuccessinreducingmalaria,was
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implementedintheRepublicofCongo,Gabon,Mali,Nigeria,andZimbabwe. Thisprogramprovided
mosquitonetstochildrensleepingoutdoors. Childdeathsfrommalariawerereducedby44%
comparedtochildrenwithoutthenets.12
Goal5:ImprovingMaternalHealth
TargetsandMeasures
Thefifthgoal,improvingmaternalhealth,canbeachievedbyaddressingthefactorsthat
contributetotheunreasonablyhighmaternalmortalityrate. Therearetwotargetsthathavebeenset
forimprovingmaternalhealth. Thefirsttargetistoreducebythreequarters,between1990and2015,
thematernalmortalityratio. Thesecondtargetistoachieve,by2015,accesstoreproductivehealth.
Themeasuresthatwillbeusedincludematernalmortalityratio,proportionofbirthsattendedbyskilled
healthpersonnel,contraceptiveprevalencerate,adolescentbirthrate,antenatalcarecoverage,andthe
unmetneedforfamilyplanning.
CurrentStatus
Themostrecentdatashowsmaternalmortalityrate,derivedfromvitalregistration,at130per
100,000livebirthsin2000. Thisrateisdown38%fromthe210valuein1995. Thecalculationisderived
fromthedirectsisterhoodmethodadjustedestimates,aprocessofinterviewingrespondentsonthe
survivalofalltheiradultsisters.13 In1999,itisestimatedthatapproximately99%ofallbirthswere
attendedbyaskilledhealthprofessional. Thisnumberhasremainedrelativelyconstantthrough2004
andisupsignificantlyfromthe61.3%in1987.14 Theuseofcontraceptivesamongcurrentlymarried
womenbetweentheagesof15and49waslastmeasuredin2004andwas72.7%,a6.9%increasefrom
1999.15 Theadolescentfertilityratehasbeenslowlydescendingsince1998. In2008,theadolescent
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fertilityratewasat82.6birthsper1,000womenbetweentheagesof1519.16Between2005and2009,
theantenatalcarecoverageforatleastonevisitwas84%and58%foratleastfourvisits. Theunmet
needforfamilyplanninghasdecreasedbymorethanhalffrom1994to2004,droppingfrom15.2%to
only7.4%.17
Recommendations
WecanachievethefifthMillenniumDevelopmentGoalbyreducingthematernalmortalityrate
andbyincreasingthenumberofbirthsthatareattendedbyskilledhealthprofessionals. Thereisroom
foradrasticimprovementtooccurinthisarea. Maternalmortalityensuingfromcomplicationsduring
birthcanbeconsiderablyreducedifthebirthsareattendedbyaskilledhealthprofessional. Thereare
veryhighcostsassociatedwithbuildingamedicalinfrastructurethatwillprovidewomenwithhealth
professionals. DuetothesesubstantialcostsitisunfeasibleasthistimeforEcuadortoallocatethe
necessaryfunds. AnalternatesolutionistosetupmobilehealthcentersmuchliketheAmericanRed
Crossandotherreliefcentersdoduringenvironmentalcatastrophes. Thesehealthcenterscandually
act
as
an
educational
facility
on
the
use
of
contraceptives
and
provide
information
on
other
safe
sex
practices. Thiswillreducetheadolescentfertilityrateandhelpkeeppeoplefromreproducingattimes
whentheycantaffordit.
Goal6:CombatingHIV,AIDS,Malaria,andOtherDiseases
Targetsand
Measures
ThesixthMillenniumDevelopmentGoalistocombatHIV,AIDS,malaria,andotherdiseasesand
threetargetsaresetthatneedtobeachievedtoreachthisgoal. Thefirsttargetistohaltthespreadof
HIVandAIDSby2015andhavebeguntoreversethespread. Thesecondtargetinthisareaistohalt
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andbeginthereversaloftuberculosisandothermajordiseasesby2015.Thefinaltargetwassettobecompletednolaterthantheendof2010anditistoachieveuniversalaccesstotreatmentforHIVandAIDSforallofthosethatneedit. InadditiontomeasuringtheprevalenceratesofHIV,AIDS,andmalaria,humandevelopmentwillbeconsideredasafactorforbeingabletocombatthesediseases.OnemethodofmeasuringhumandevelopmentisbyanalyzingtheHumanDevelopmentIndex. TheHumanDevelopmentIndex(HDI)measurestheachievementsofacountrybasedonlifeexpectancy,adultliteracyrate,andGDPpercapitapurchasingpowerparity,asanalternativetoevaluatingacountrysdevelopmentbasedsolelyonpercapitaGDP.18 EachofthesefactorsisweightedincalculatingtheHDIshowninFigure2.0. Theincomeindexiscalculatedusingthisformula:
The$40,000isrepresentativeofthemaximumincomethatacountrycouldreasonablyaspireoverthecominggeneration. ThenextfactorintheHDIisthelifeexpectancyindexwhichiscalculatedusingthelifeexpectancyinEcuadorandrelatingittotherangeoflifeexpectanciesthattheUnitedNationsDevelopmentProgram(UNDP)expectsoverthepreviousandnextgenerations. ThefinalfactorincalculatingtheHDIistheeducationindex. Theeducationindexiscomputedusingthemeanyearsofschoolingindexandtheexpectedyearsofschoolingindex,equallyweighted. TheHDIweightsthe
incomeindex,
life
expectancy
index,
and
education
index
equally
and
the
average
is
the
result.
The
HumanDevelopmentIndexisimportanttothisgoalbecausethefactorsthatcompriseithelpindicatetheexpectedshiftofAIDS,HIV,andmalariaprevalencerates.
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CurrentStatus
EcuadorhasbeeneffectiveinhaltingandreversingHIV/AIDSdeaths. In2003,theHIV/AIDS
deaths
per
year
were
1,700.
They
remained
at
that
approximate
level
until
2009
and
2010
when
deaths
decreasedto1,400peryear.19Since2000,thetuberculosisprevalencerateper100,000hasbeen
reversing. In2004,Ecuadorexperiencedareductioninprevalenceratefrom243to196per100,000
people.Thedeathratefromtuberculosisremainsaround12.4%oftheprevalencerate. Therecent
decreaseintheprevalenceratewillcauseadecreaseinthedeathrate.Ecuadorhasachievedamedium
statusonthehumandevelopmentindexandcontinuestogainmomentumtowardahighhuman
developmentstatus.
Recommendations
ThereisanarrayofpossiblesolutionstohelpcombatHIV,AIDS,malaria,andotherdiseases. If
Ecuadoristobetterits77thHDIranking,theeducationindexneedstoimprove. Ahighereducation
indexmeanstherehavebeenanincreaseintheaveragenumberofyearsofschoolingaswellasan
increaseintheexpectednumberofyearsofschooling. Theeducatedyouthwillbemoreresilientto
havingsexafterunderstandinghoweasilyHIVcanbetransmitted. Ecuadoralsoneedstoinvestina
programthatwillhelppeoplealreadylivingwithHIVtoreceiveassistancewithmealsandotherdaily
activities. Effortstocombatmalariaareaddressedbyparticipatinginthemosquitonetprogram
suggestedasamethodtoreducechildmortalityrates. Thisprogramcanbeexpandedtoincludeadults
aswellastheyouthpopulation. Otherdiseasescanbesignificantlyreducedwithanimmunization
program. Immunizationscanbedistributedatthemobilehealthcentersandthecostscanbesubsidized
byusingapercentoftheofficialdevelopmentassistancethatisreceivedannuallyasforeignaid.
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Goal7:EnsuringEnvironmentalSustainability
TargetsandMeasures
TheseventhMillenniumDevelopmentGoalistoensureenvironmentalsustainability. Four
targetshavebeensettomeasuretheachievementofthisgoal. Thesetargetsincludeintegratingthe
principlesofsustainabledevelopmentintocountrylawsandprograms;stoppingandreversingtheloss
ofenvironmentalresources;reducingbiodiversitylossbyachievingasignificantreductionintherateof
loss;halvingtheproportionofthepopulationwithoutsustainableaccesstosafedrinkingwaterand
basic
sanitation
by
2015;
and
achieving
a
significant
improvement
in
the
lives
of
the
slum
dwelling
populationby2020. Biodiversitylosswillbemeasuredbyanalyzingtheproportionsofspecies
threatenedwithextinctionandthelandareacoveredbyforest.
CurrentStatus
ThereisavastarrayofenvironmentalissuesplaguingEcuadoranditssurroundingareas. The
mostecologically
sensitive
area,
just
off
the
coast
of
Ecuador,
is
the
Galapagos
Islands.
The
issues
faced
bytheIslandsincludedeforestation,soilerosioninhighlandareas,desertification,waterpollution,and
pollutionfromoilproductionwastes. Ecuadorhasmademinimaleffortstocombatflooding,
desertification,anddeforestation,whichisoccurringatarateof840,000acresannually.20 Landarea
coveredbyforestdroppedover10%between1990and2005. Thisisasizablereductionconsidering
landareacovers276,841sqkm. TheGalapagosIslandsarearguablythemostthreatenedareainSouth
America. Currently,theIslandsarehometo95species,ofwhich,ninespeciesarecurrently
endangered.21
ThepopulationexpansioninEcuador,representedinFigure2.1,isconsideredaseriousthreatto
wildlifeintheGalapagosandonthemainland.Thecrudedeathrateremainsextremelylowandis
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significantlygreaterthanthecrudebirthrate. Ecuadorexperiencedanaveragepopulationgrowthrate
between1.5%and2%inrecentyears.TheotherthreattotheGalapagosisanincreasedtourism
industry. Tourismisverybeneficialtotheeconomyandcanhelpinbringingacountryintodevelopment
quicker,butitneedstobecloselymonitoredtoensuretheIslandsdonotgetdamagedbeyond
restoration. AnothergreatsignforEcuadoristhatevenasthepopulationcontinuestogrow,therehas
beenadrawbackintheslumpopulation,whichwasreducedby4%between2001and2005. Figure2.2
showstheproportionofthepopulationusingimproveddrinkingwatersources. Figure2.3identifiesthe
proportionofthepopulationusingimprovedsanitationfacilities. Anupwardtrendisprominentinboth
figures. Ecuadorhasreachedanothertargetfordevelopmentbyhalvingtheproportionofpeople
withoutsustainableaccesstosafedrinkingwaterbetween2000and2006.
Recommendations
Deforestationcanbereducedbyplacingstrictregulationsontraditionalfarmingandoil
development. Desertificationandfloodingareresultingfromaninfluxofdomestic,industrial,and
agriculturalcontaminants.
These
contaminants
can
be
contained
through
stricter
environmental
regulationswhichneedtobeenactedbythegovernment. Onewayofreducingenvironmental
destructionisbyprovidingcitizenswithaccesstosafedrinkingwaterandsanitationfacilitiesthrough
environmentallyfriendlymethods. Itistheresponsibilityofthegovernmenttodevelopan
infrastructurethatwillleadtoeconomicgrowth. Thiscanbedonebyincreasingtravelaccessibilityin
termsofairports,roadways,railways,andwaterways. Althoughallofthesearenotfeasibleduringthe
remainingtime
frame
set
to
achieve
the
Millennium
Development
Goals,
it
is
important
to
make
developmentsovertime. Onepositiveeffectofdevelopingasoundinfrastructureisreducingtheslum
populationinurbanareas. Peoplethatmayhavebeenunemployedorunderemployednowhaveaccess
tomanynewandexcitingemploymentopportunitiesthatmayhavebeenpreviouslyunattainable.
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Ecuadorcancombattheozonedepletionratebyillegalizingtheuseofhydrochlorofluorocarbons
(HCFCs)inanyproductssoldorproducedinthecountry.
Goal8:DevelopingaGlobalPartnershipforDevelopment
TargetsandMeasures
ThefinalMillenniumDevelopmentGoalsetbytheUNwastoestablishanddevelopaglobal
partnershipforeconomicdevelopment. Therehavebeenanumberoftargetssettogaugeperformance
inachievingthisgoal. Thesetargetsincludedevelopingandimplementingstrategiesfordecentand
productiveworkforyouthincooperationwithdevelopingcountries,makingthebenefitsofnew
technologyavailableincooperationwiththeprivatesector,anddevelopinganondiscriminatorytrading
andfinancialsystem. Thesetargetswillbemeasuredbyanalyzingtheratioofadultunemploymentto
youthunemployment,theamountofofficialdevelopmentassistancereceived,numberofinternet
users,numberofcellularsubscribers,andEcuadorsaccesstodevelopedmarkets.
CurrentStatus
Theratioofadultunemploymentratetoyouthunemploymenthasdeclinedfromahighof4.8in
1995to2.6in2003. Thisisapositivesignthatdecentandproductiveworkisbeingcreatedforthe
youth. However,thatfailstoaddressthepossibilitythatthegrowthrateofyouthtototalpopulationis
high. Studiesshowthattheshareofyouthunemployedtototalunemployedwas53.1in1995andhas
decreasedto43.1in2003.Therefore,Ecuadorisdevelopingandimplementingstrategiestocreatework
foryouth. Thecommunicationindustryhasbeensignificantlyimprovedsincetheearly1990s. The
availabilityoftheinternetandcellularlinesaretwooftheeasiestwaystoaccessaworldofinformation.
Ausercannowquicklyaccessrelevantdata.Theinternetisusedforthecontinuedimprovementof
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companiesandeconomicgrowth. AnanalysisofthedevelopmentofcommunicationsinEcuadorsince
1990ispresentedinFigure2.4.Figure2.4showstherehasbeensignificantgrowthinthenumberof
usersaccessingtheinternetasawholeandasapercentofpopulation. Thenumberofinternetusers
hasrisentomore15%ofthetotalpopulationsinceitsinductioninEcuadorin1993.Thenumberof
cellularsubscribersasapercentofpopulationnearlydoubledfrom22.98%to39.08%,between2003
and2005.
Todevelopaglobalpartnershipforeconomicdevelopment,underdevelopedcountriesoften
receiveasubstantialamountofforeignaidfromtheInternationalMonetaryFund(IMF)andfrom
specificcountries. TheUnitedStatesoffersthelargestamountofassistancetoEcuadorintermsof
foreignaid. TheaidfromtheU.S.hasgoalstostrengthendemocracy,reducepoverty,protectthe
environment,andsecuretheirborders. Between2007and2009,Ecuadorreceived$89.7millioninU.S.
aid,including$39.8millionincounternarcotics.22 Thesefundsonlyincludemonetaryaidthatisdirectly
senttoEcuadoranddoesntcountanysortoftrade.TheforeignaidreceivedfromtheIMFisallocated
totheimprovementofthetransportationinfrastructure,thereductionofpoverty,andthe
improvement
of
the
educational
system.
The
Official
Development
Assistance
(ODA)
received
by
EcuadorfromtheIMFisgraphicallyrepresentedinFigure2.5. Foreignaidhasremainedrelativelystable
between1997and2006rangingfrom$150millionto$250million.However,aidasapercentofGDP
hasbeendiminishing. Ecuadorhasbeenimprovingtheprimaryeducationrateforgirlsandboys,the
childmortalityrate,theaccessibilitytocleandrinkingwater,andsanitationfacilities. These
improvementshavebeenmadeeventhoughaidasapercentofGDPhasbeendiminishing. This
representsEcuadors
ability
to
become
self
sufficient,
and
in
turn
adeveloped
country.
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Recommendations
Ecuadorismakinggreatstridesinitseffortforglobalconnectedness. Theinternetandcell
phones
have
flattened
the
world
to
a
once
unimaginable
size.
The
internet
offers
an
unlimited
number
ofbenefitstofamiliesandbusinesses. Someofthemostimportantbenefitsincludetheabilityto
telecommutewhichallowsuserstoaccessalloftheirresourcesthatcouldbestoredonanoffice
computeroracoworkerscomputeroverseas;theabilitytosearchquickly,easily,andeffectivelyfor
informationthatwouldbeverytimeconsumingtofindinbooks;theabilityforbusinessestooffer
onlinetrainingprogramsandteleconferences;theoptionforonlinebanking;andtheabilitytoemail,
Skype,or
instant
message.
Ecuador
needs
to
execute
on
aprogram
that
provides
more
families
with
the
opportunitytoaccesstheWorldWideWeb.
Intheworld,thetotalnumberofinternetusersasapercentageofthetotalpopulationis28.7%.
Currently,only15%ofEcuadorianshaveaccesstotheinternet. Ecuadorshouldstrivetoreachthe
averagelevelwiththerestoftheworld. Aprogramthatcouldhelpincreasethispercentusesrecycled
cellphonesfromdevelopedcountries. Thesephonescanbesetupwithdataplanstoallowuserstocall
anywhereintheworldandaccesstheweb. Cellphonesubscribersthathaveadataplanshouldbe
providedadiscountonthetaxesthatarepaidonthemonthlybillaswellassmallbusinessesowners
thatareusingtheinternetintheirbusiness.DebthasbeenaseriousprobleminEcuadorinrecentyears
andthegovernmentneedstotakeaction. TheEcuadorianGovernmentshouldreevaluatetheir
spendingtoensurethattherewillbenomoreinstancesofdefaultingonbonds. TheOfficial
DevelopmentAssistancereceivedannuallyshouldonlybeusedtodeveloptheinfrastructureorprovide
neworimprovedservicestocitizens. TheODAshouldnotbeusedtofundprogramsthatarenotself
sustainingbutratherareusedtoinvestinresearchinginnovativewaystoturnmoneypitprograms
intoonesthatareselfsustaining. Ecuadorcanalsoestablishfreetradeagreementswithmany
countriesinSouthAmericatoincreasetradeandexportrevenues. Thecurrentnegotiationstakingplace
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withMexico,Brazil,Argentina,Paraguay,andUruguayshowEcuadorscommitmenttoloweringtrade
barriers,diversifyingtheireconomy,andhavingafavorablebalanceoftrade.Theincreasedrevenues
fromexportscanbeusedtohelpaccomplishthegoalsthatarecurrentlybeingfundedbytheU.S.and
theIMF.
TransnationalIssuesIllicitDrugs
TherearetwomajortransnationalissuesplaguingtheEcuadorianeconomy. Transnational
issuesare
issues
involving
or
impacting
countries
outside
of
one
countrys
borders.
The
first
issue
is
illicitdrugs. Ecuadorissurroundedbytwolargecocaineproducingcountries,PeruandColumbia. There
issignificanttransitoftheseillicitdrugsandothernarcotics. TheUnitedStatesisthedestinationfora
largeportionoftheharvestedcocaine,anditneedstopassthroughtheEcuadorianwaterstoreachthe
UnitedStates. Ecuadorisnearlytheperfectlocationfordrugtraffickerstostoretheircashbecauseof
theweakantimoneylaunderingregimeaswellastherecentdollarizationthatoccurredin2000,
allowingtraffickerstouseU.S.currencyfortheirtransactions.23 Thesedrugsarenotbeingproduced
withinthecountry,onlymerelytransportedacrosstheborderfromtheirneighbors. Ecuadorneedsto
identifythetransportationroutesandmethodsoftransportationaswellascombatanynewshipments
fromcrossingtheborder.
Political:RelationshipwiththeUnitedStates
ThesecondissueaddressespoliticalinstabilityandtheirpositionwiththeUnitedStates.
Ecuadorexperiencedpoliticalinstabilitybetween1997and2006. In1996,PresidentAbdalaBucaram
waselectedanddismissedshortlyafteronthegroundsofcorruption. In1998,JamilMahuadwas
electedPresidentandwasassistedbyGustavoNoboa. Mahuadleadthecountryduringatimeof
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increasingeconomicandfinancialdifficultiesbutwasunabletocompletehisterm,ashefledthepalace
onJanuary21,2000,atwhichtimeNoboabecamehissuccessor. NoboahelpedtorestoreEcuadortoa
levelofstabilityandgrowthprimarilyledbytheadoptionoftheU.S.dollarastheofficialcurrency.
NoboawasabletoleadEcuadorintoatimeofeconomicexpansionbecauseofthelackofcorruption
duringhistenure.
BoththeUnitedStatesandEcuadorareinterestedincombatingthedrugtraffickingoriginating
ontheEcuadorianborders,improvingeconomicdevelopmentinEcuador,andreducingpovertyforall
citizens. Thestrongrelationshipbetweenthesetwocountriesislargelyinpartduetothenumberof
EcuadorianslivingintheU.S.andthenumberofAmericansvisitingtheGalapagosIslands.TheU.S.
providedcloseto$60millionineconomicassistancetoEcuadorin2009.24TheU.S.assistsEcuador
throughorganizationsthatincludetheU.S.PeaceCorps,theStateDepartmentsNarcoticAffairs
Section,andtheAgencyforInternationalDevelopment.
ConclusionCurrentStatus
EcuadorisstrivingtoachievethetargetsthatweresetfortheMillenniumGoals. Theyhave
seenadrawbackinthelevelofextremepoverty;experiencedahighlevelingrossandnetenrollment
withintheprimary,secondary,andtertiaryeducationlevels;reducedthegenderequalitygapinterms
ofemploymentintheindustryandservicesectors;andincreasedinthenumberofwomenengagedin
parliament. Inaddition,childmortalityratesandmaternaldeathrateshavebeenconsiderablyreduced.
ThespreadofHIV,AIDS,malaria,andotherdiseaseshasbeenhaltedandareversalprocesshasbegun.
Boththereductioninmortalityratesandspreadofdiseaseshasledtopopulationgrowth. Ecuadoris
verycapableofreachingadevelopedlevelby2015. Politicalcorruptionhasbeenreduced,
environmentalissuesarebeingaddressedandcorrected,andtheyareworkingtoachieveself
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sufficiencyfromforeignaid. However,Ecuadormustincreaseitseducationalexpendituresifithopes
forfurtherfuturedevelopment.
ProgramRecommendationsStage1
Ihaveofferedasignificantnumberofrecommendationsforprogramsandinitiativesthatwill
allowEcuadortomeetorexceedtheMillenniumDevelopmentGoals. Theserecommendationscanbe
brokenintothreestages,eachofwhichwilladdvaluetothepreviousefforts. Overall,thegoalofthe
UNistoimprovethequalityoflifeforallindividualsintheworld. EcuadorcanhelptheUNachieveits
goalbyimplementingmyrecommendationsinthreestages.Thefirststagewillidentifyprogramsin
Ecuadorthatarebeingannuallyfunded,butnotimproved,andrequirelittletonocapitaltoimplement
Expertsshouldbehiredtoresearchalternatemethodsofprovidinggoodsorservicesinprogramsthat
canbeselfsustaining,ratherthanprogramsthatareburdenonthegovernmentsfinancialresources.
Theseselfsustainingprogramsareresponsibleforcreatingarevenuestreamthroughfeesandother
methodstocoveralloftheirexpenses. Theseprogramswillbemanagedinthesametraditionalmanner
asnonforprofitprograms. Thefreetradeagreementsthatarecurrentlyinnegotiationsneedtobe
completedasawaytoincreaseexportsandcreateaccesstonewmarkets. Afterthegovernment
restructuresexistingprogramstoeliminatewastefulspending,theirspendingcanberedirectedinto
subsidizedfarming. Throughsubsidizedfarming,Ecuadorwillseeanincreaseinagricultural
productivity. TheincomereceivedfromtheIMF,U.S.,andothercountriesshouldcontinuetobespent
forthe
purposes
that
it
has
been
sent
to
achieve.
Another
recommendation
in
this
stage
is
to
illegalize
HCFCsandotherharmfultoxinstocombatozonedepletion. Myotherrecommendationscallfor
stricterenvironmentalregulationstocombatdeforestationandalsoenactingalawthatrequireswomen
toholdacertainpercentageofseatsinnationalparliament.
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Stage2
Thesecondstageofrecommendationsfocusesonimprovingbusinessesandhealth. Thefirst
programofthisstageistocreateastrongmicrofinancesectorthatencouragesEcuadorianstocreate
theirownbusinesseswhentheyareunemployed. Thegovernmentneedstosetasidefundsthat
guaranteeacertainamountofmoneytostartupbusinesses. Thiswillallowpeopletheopportunityto
createabusinesseveniftheywouldnotbeabletogettheloanfromabankwithoutthehelpofthe
government. Instage1,governmentfundedprogramswererestructuredtoeliminateallwasteful
spending. InthisstageitisnecessarytofocusoneducationalexpendituresasapercentageofGDP. By
increasingeducational
expenditures,
there
will
be
the
ability
educate
teachers;
provide
new
textbooks
andtechnology;andensurethateverystudentcanattendaschoolthatisinreasonableproximityto
theirhomes.Improvementsingenderequalityshouldalsooccurinthesecondstage. Thegovernment
shouldlaunchanincentiveprogramprovidingtaxcreditstobusinessesthathaveestablishedtraining
andrecruitingprogramsthatrecognizegenderequalityanddonthaveapayscalethatisgenderbiased.
Myfinalrecommendationinthesecondstageistoprovidewomenwithanincentivetobreastfeed. This
couldbeanincreasedtaxoninfantformulaorcreatingamandatorydocumentthatneedstobesigned
whenpurchasinginfantformulawhichoutlinesthebenefitsofbreastfeeding.
Stage3
Thethirdstageofrecommendationsfocusesonimprovingmortalityratesbycombatinga
numberofproblems. Afterimplementingtherecommendationsinthefirsttwostages,thegovernment
shouldnolongerbefinanciallyobligatedtopoorlydesignedprograms. Myfirstrecommendationin
stagethreeistosetupmobilehealthcentersthroughoutthecountry,withmorehealthcentersbeing
placedinhighpopulationdensityareas. Atthesehealthcenters,patientswillbeprovidedmosquito
netstohelpstopthespreadofdisease. Thesecenterswillalsohavefreeinformationonhealthyliving
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andonsitehealthprofessionals. Thesehealthprofessionalscanaidwithsafebirth,offerassistanceto
peoplelivingwithdeadlydiseases,andadministerimmunizationsagainstdeadlydiseases. Thereare
manybenefitsofhavingthesehealthcentersasmobileunitsinthisstageofEcuadorsdevelopment.
Twobenefitsincludebeingabletoreachpeoplethatcanttravel,theywillbeabletotraveltowhere
theyareneededmost. Myfinalrecommendationinthisstageistoprovidetaxrelieftocellphone
subscribersandsmallbusinessesthathaveembracedtheinternettogrowtheirbusiness. Thecoststo
benefitsofeachprograminthethreestagesarealigned. Themostcapitalintensiveprogramsarefound
inthethirdstage. Afterimplementingallofmyrecommendationsinthethreestages,Ecuadorshould
befinanciallysecureandhavecapitaltoinvestinitspermanentinfrastructure.Improvementstoits
permanentinfrastructureincludecreationofnewroadways,airports,hospitals,andanupgradeto
telecommunications.
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Appendix
Figure1.1
Table1.1
$0
$20
$40
$60
$80
$100
$120
$140
$160
CrudeOil
Price
per
Barrel
DailyOilPriceSource:IOGA
Source:IOGA
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Figure1.2
Figure1.3
0.00%
0.02%
0.04%
0.06%
0.08%
0.10%
0.12%
0.14%
2,500,000
3,000,000
3,500,000
4,000,000
4,500,000
5,000,000
5,500,000
6,000,000
6,500,000
7,000,000
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
GrowthRate
Population
GrowthRateofGDPperPersonEmployed
PopulationEmployed(15+) GrowthrateofGDPperPersonEmployed
Source:CIA TheWorldFactbook
Source:IndexMundi,myCalculations,U.S.CensusBureauIDB
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Figure1.4
Figure1.5
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
PercentageofIncome
PercentageofPopulation
LorenzCurve
1995 2003 2005 2007 LineofPerfectEqualitySource:WorldBank
0
10
20
30
40
50
60
1998 2000 2003 2006 2009 2010
GiniCoefficient
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Figure1.8
Figure1.9
800 600 400 200 0 200 400 600 800
04
1014
2024
3034
4044
5054
6064
7074
8084
9094
100+
Population(Thousands)
AgeGroups
2010AgeDistribution Females Males
0
10
20
30
40
50
60
70
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
MortalityRateper1
,000Births
%of1YearofChildrenImmunized
ReducedChildMortality
Infantmortalityrate(per1,000births)
Under5mortalityrate(per1,000births)
Child1yr.oldimm.measles
Sources:U.S. CensusInternationalDatabase&IndexMundi
Source:U.S.CensusBureau,InternationalDataBase
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Figure2.0
Figure2.1
0.000
0.100
0.200
0.300
0.400
0.500
0.600
0.700
0.800
$
$1,000
$2,000
$3,000
$4,000
$5,000
$6,000
$7,000
$8,000
2000 2001 2002 2003 2004 2005 2006 2007 2008
IncomeIndex
GDP(PPP)
GDP(PPP)/IncomeIndex
0.500
0.550
0.600
0.650
0.700
0.750
0.800
0.850
0.900
2000 2001 2002 2003 2004 2005 2006 2007 2008
IndexValue
Year
HumanDevelopmentIndex
HDI EducationIndex IncomeIndex LifeExpectancyIndex
Source: 2008WorldDevelopmentIndicatorsCD&Authors'Calculations
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Figure2.2
Figure2.3
0
10
20
30
40
50
60
70
80
90
100
1990 1995 2000 2006
ProportionofPopulation
Year
ProportionofPopulationUsing
ImprovedDrinkingWaterSources
Rural DrinkingWater
Urban
DrinkingWater
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Figure2.4
Figure2.5
0
10
20
30
40
50
60
70
80
90
100
1990 1995 2000 2006
ProportionofPopulation
Year
ProportionofPopulation
UsingImprovedSanitationFacilities
Rural SanitationFacilities
Urban SanitationFacilities
Total SanitationFacilities
Source:IndexMundi
0
1,000,000
2,000,000
3,000,000
4,000,000
5,000,000
6,000,000
1989 1994 1999 2004 2009
TotalUsers
Year
TotalInternetUsersandCellularSubscribers
(per100
Population)
InternetUsers
Cellular
Subscribers
Source:IndexMundi
Note:Bubblesizerepresentsusersper100population
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Figure2.6
0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
0
50
100
150
200
250
300
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
Millions
Year
OfficialDevelopmentAssistance(IMF)
ForeignAid
Aidas%ofGDP
Source: WorldBank
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1"CIA TheWorldFactbook Ecuador."CentralIntelligenceAgency.09Nov.2010.Web.30Nov.2010.
.
2"EcuadorBusiness."Web.06Mar.2011..
3"IncomeInequality Ecuador Economy."IndexMundi CountryFacts.Web.03May2011.
.
4UnitedNationsStatisticsDivision.Web.03May2011..
5"PrevalenceofUnderweightChildrenUnderfiveYearsofAge."Unstats|MillenniumIndicators.Web.
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