The ICT Ecosystem in Ecuador – Challenges and Opportunities
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Ecuador, a small South American market with a population of 17 million people, is predominantly a cash economy. The Ecuadorian government, however, has repeatedly expressed interest in developing digital opportunities for the country, emphasizing that increases in internet access and provision of digital services will create efficiencies and increase productivity.
The digital economy in 2018 accounted for $1.286 billion of Ecuador’s GDP (1.2 percent), which doubled that of 2017. Even with such a large increase in provision of digital services, Ecuador still lags well behind stronger digital economies in South America. Only sixty-nine percent of the Ecuadorian population has ever purchased something on the Internet. This trend is partly due to low (but increasing) internet penetration rates but also due to the high cost of computers, cell phones, and devices and especially the low penetration of banking services.
The Ecuadorian government eliminated tariffs in October 2019 on cellphones, computers, tablets and laptops that had ranged from 10 to 15 percent. The Ministry of Telecommunications is expected to put out tenders for the deployment of 4G and 5G in the next two years. There are many opportunities in the ICT arena in Ecuador, as the ecosystem is in development.
Ecuador is back on the radar of U.S. companies with opportunities in ICT.
- Ecuador has adopted a policy of gradual trade openness and has expressed its intention to negotiate trade agreements with the Pacific Alliance and the United States.
- As part of its economic reform strategy, the Moreno administration has lowered import tariffs on numerous items, particularly intermediate goods and electronics, to improve Ecuador’s economic competitiveness.
- The United States is Ecuador’s top trading partner, accounting for 30 percent of its exports ($6.7 billion), and 23 percent of its imports ($5.0 billion) in 2019 (Ecuadorian Central Bank stats).
- Best ICT Prospects: Cybersecurity, payment gateways, online banking, application and web development, education in digital economy, E-commerce, banking intermediaries, digital marketing, value-chain applications, ITC consulting, software, CAD, the Internet of Things, AI, smart cities, ICT and Telecom Equipment
Learn about the Information and Communication Technology (ICT) ecosystem in Ecuador, review the current situation and highlight best prospects.