Ecuador central bank cuts 2023 growth forecast due to lower oil exports

QUITO (Reuters) – Ecuador’s central bank on Friday cut the Andean country’s economic growth forecast for the year to 2.6%, from 3.1%, citing the impact of reduced oil exports, and said economic growth in 2022 was 2.9%

Protests, an earthquake, and damage to infrastructure have all weighed on Ecuador’s oil operations this year, with the country’s energy ministry cutting its oil production forecast for 2023 by 8%.

“For 2023, Ecuador’s central bank has revised its economic growth forecast to 2.6%, due to a slowdown in oil exports,” bank manager Guillermo Avellan told reporters.

The country’s state-run oil company Petroecuador, which produces the majority of Ecuador’s crude, declared force majeure on four blocks earlier this month over protests by indigenous communities who accuse the business of reneging on promises of economic help.

An earthquake that struck the country almost two weeks ago also affected an off-shore oil platform, reducing output, while a bridge collapse forced the closure of oil and gas pipelines, affecting exports.

Energy Minister Fernando Santos previously suggested the targeted production of 520,000 barrels per day (bpd) for the year would have to be cut to between 480,000 and 490,000 bpd

Some of the fall in oil exports will be compensated by government plans to increase public investment, Avellan said.

Ecuador’s economic gross domestic product (GDP) growth hit 2.9% last year, the bank chief said, beating previous estimates of 2.7%.

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