Ecuador’s economic future is complicated

Photo: Expreso

As permanent incomes, it considers concessions that would no longer exist.

The Government proposed an economic reform to the National Assembly as part of the plan that will replace -for a time- the elimination of subsidies.

This budgetary pro forma would cause medium and long-term problems which will be tightly overcome next year but the following years could be catastrophic (2021, 2022, 2023.) By 2023, USD 800 million more than in 2020 must be raised, for the Value Added Tax.

Economy Minister Richard Martinez aspires to obtain about two billion dollars in 2020 by the privatization of the Sopladora hydroelectric plant, the National Telecommunications Corporation (CNT) and the Pacific Bank. This concession -of public companies and other state works- is an income that the government counts as permanent.

Former Minister of Economy Fausto Ortiz is concerned that this income is considered among the permanent amounts. For the following years, public properties will not be concessioned again because they would already be in private hands. He tweeted: “In 2021, they will have to be replaced by another permanent [incomes]. Cuts, expenses, fuel, taxes.”

By 2020, USD 14,323 million would be raised from taxes alone, but by 2023, it would be USD 15,632 million, increasing almost USD 1,300 million that are not explained in the project.

Source: Pichincha Universal

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