Public investment in Ecuador reached $6.3 billion in 2012, a sixfold increase since 2007, according to the Ministry of Planning and National Development, Senplades.
The ministry also reports that Ecuador has the highest rate of public investment as percentage of gross domestic product (GDP) of any country in Latin America. In 2011, the country spent was 14 percent of GDP on public works 16.6 percent in 2012.
According to minister director Fander Falconi, the high level of investment in public spending will continue. “The country’s leaders, including president Correa, have the political will to continue channeling resources into public investment and see it as the engine of continued development,” he said. “By investing in our infrastructure we are building our human capacity.”
The country has made substantial increases in spending for education, health care, highways and environmental protection projects since Correa was first elected in 2006.
Falconi said the country is able to afford the investment because of increased income from petroleum sales and growing tax revenues. “Our ratio of GDP to foreign debt has decreased since 2006, from 22 percent to 14 percent. To those who claim we cannot afford the spending, I direct them to the numbers.”
Falconi added that spending on debt in 2006 accounted for 24 percent of GDP compared to only 4 percent in 2012.
The government reports that the poverty rate has fallen from 36.7 percent in 2007 to 23.5 in 2012, while the rate of "extreme income poverty" has fallen from 16.5 to 9.4 percent.
The government also says it expects economic growth to slow in 2013, projecting a rise of only 3.5 percent, compared to 5 percent in 2012 and 8 percent in 2011.
Ecuador spends $527 million on foreign scholarships
The government of Ecuador has spent $527 million since 2007 provding scholarships to university graduate students to study abroad. In 2012, more than 1,600 students were studying at such universities as Oxford, London School of Econonics, Harvard, Stanford and the Sorbonne.
The program, called the “Formation of human talent” initiative, requires Ecuadorians who accept the scholarships and graduate from foreign instutitutions, to spend four years working in Ecuador following graduation.
Pablo Cardoso, head of the initiative, says that the program is a “great investment” for Ecuador and is one of the government’s keys to achieving economic growth. “We are creating a pool of talent that will make this country competitive on a world-wide basis.”
Exports rise 7.5 percent ion 2012 to $23.9 billion
Higher oil exports allowed Ecuador to cut its trade deficit in 2012 to $143 million from $687 million the previous year, the Central Bank said on Friday.
Total exports last year increased 7.1 percent to $23.9 billion, while imports rose 4.7 percent to $24.0 billion, the bank said in a statement.
Oil exports increased 6.5 percent in value and 4.5 percent in volume last year. Meanwhile, shipments of non-oil products rose 7.8 percent in value but dipped 3.2 percent in volume.
Ecuador is OPEC's smallest member and its economic growth depends heavily on oil revenues. Oil output has been stagnant at around 500,000 barrels per day over the past five years but higher prices have still produced a windfall for the country.
Since 2009, the government has been trying to limit imports of car parts, household electronic devices, cellular telephones and other goods to shrink the deficit.
Photo caption: Rafael Correa says that the current high level of public spending will continue.