Since 11 March, Ecuador has been imposing a surcharge on about 30 per cent of imports to safeguard its balance of payments due to a “highly unfavourable economic climate”. These surcharges consist of 5 per cent on “non-essential capital and primary capital goods”, 15 per cent on imports of “medium need”, 25 per cent on ceramics, tyres, motorbikes and TVs and 45 per cent on final consumer goods. Ecuador notified the measure to the WTO in April 2015.
In resuming discussions following the previous meeting on 29-30 June, Ecuador shared with members a plan to phase out the import surcharge by June 2016 and announced that the surcharge on final consumer goods would be reduced from 45 per cent to 40 per cent as of January. Some members strongly supported Ecuador's measure, while others called for its immediate removal. Several other members expressed sympathy with Ecuador's balance-of-payments difficulties and said they appreciate Ecuador's information sharing, but reiterated serious concerns including on whether the measure could be economically justified, whether it is in line with WTO rules, and on its negative impact on export from other WTO members.
Read the concerns members expressed at the June meeting here.
A representative from the International Monetary Fund (IMF) reported that Ecuador’s economic situation has worsened since June, mainly due to the sharp drop in oil prices in recent months affecting the main sector of Ecuador’s economy, as well as declining growth, a deteriorating business climate, difficulties in accessing financing and currency appreciation.
To justify the need for the measure, Ecuador provided additional clarifications on its economic and balance-of-payments situation and prospects, and outlined the results of the second evaluation of the impact of the measure.
The Committee on Balance-of-Payments Restrictions is scheduled to resume its consultations with Ecuador in February 2016 following a third evaluation of the impact of the measure by Ecuador.
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