TRADE POLICY REVIEW: ECUADOR
15 and 17 June 2005

Concluding remarks by the Chairperson


See also:
> Press release: Continued reform would improve resilience and sustain economic growth


The first Trade Policy Review of Ecuador has shed light on Ecuador's trade and investment policies and practices, and on the economic and institutional framework within which they are formulated and implemented. We owe this to the participation of Vice-Minister Espinosa, Ambassador Escudero, and the rest of the Ecuadorean delegation; the thoughtful interventions by Ambassador de Mateo; the questions of the Members; the documentation prepared for the meeting; and the domestic consultation and review process that underlie this documentation. Throughout the review process, the authorities of Ecuador have shown a strong commitment to transparency and thus made a key contribution to the success of this Review.

I should first like to emphasize that Members welcomed the positive performance of Ecuador's economy in recent years, as reflected by the growth in per capita income, low inflation and the reduction in public debt. These achievements were attributed to both domestic reforms and a favourable external context, and followed a series of adverse developments in the latter part of the 1990s. Members encouraged Ecuador to maintain fiscal discipline and persevere with its structural reform programme to make the economy more resilient to future external shocks.

Members acknowledged Ecuador's efforts to strengthen its legal and institutional framework. They commended Ecuador for taking significant steps to implement its WTO commitments but noted that Ecuador could further enhance transparency by fulfilling its outstanding WTO notification obligations. Members took note of the importance that Ecuador attaches to bilateral and regional initiatives, and emphasized the need to ensure that those initiatives are complementary to the multilateral trading system. Ecuador was invited to enhance its attractiveness as an investment destination by using WTO commitments to give greater predictability to its legal and institutional framework.

Members welcomed the significant steps Ecuador had taken to liberalize its trade regime through unilateral, regional, and multilateral initiatives. In particular, Members noted that Ecuador has bound its entire tariff schedule, and that applied rates have fallen considerably. However, the wide gap between applied and bound rates reduces predictability, and some applied rates appear to exceed their bound levels. Ecuador's limited use of contingency measures was highlighted. Several Members questioned Ecuador's application of certain import charges, its use of a price-band system, and the administration of tariff quotas.

The persistence of some non-tariff barriers was a source of concern. In particular, Members urged Ecuador to continue the reform of its import licensing regime. They also referred to Ecuador's lengthy customs procedures, and invited Ecuador to pursue its modernization programme and to take full advantage of on-going trade facilitation negotiations in the WTO. Members invited Ecuador to adhere fully to WTO obligations in the areas of customs valuation, sanitary and phytosanitary measures, and technical barriers to trade.

Ecuador provided information on the scope and use of the drawback and maquila programmes, and answered questions on competition policy, government procurement, and intellectual property rights.

Members praised Ecuador for adopting relatively broad commitments under the GATS. They encouraged Ecuador to adhere to the WTO Reference Paper on telecommunications, and urged it to table a comprehensive and ambitious offer in the context of the WTO services negotiations. Members encouraged Ecuador to persevere with the reform process in electricity, financial services, telecommunications, and transport in order to improve the competitiveness of its economy.

I conclude by thanking the Ecuadorean delegation for the oral and written responses provided during the meeting. I look forward to receiving outstanding answers within the delay allowed. I welcome Ecuador's ongoing efforts to liberalize and improve the predictability and transparency of its trade regime, and encourage Ecuador to take advantage of the current favourable economic climate to address remaining trade and investment barriers. I trust that our discussions in this Review will help Ecuador identify and ease those barriers to ensure the sustainability of economic growth.