Skip to main content

Ecuador: political turmoil brings default risks back

The looming impeachment trial of Ecuador’s president Guillermo Lasso marks a further intensification of the country’s political crisis and suggests that the recent experiment with market-friendly governments is on borrowed time. There are lots of ways in which things could play out, but one likely consequence is a shift away from the fiscal austerity of recent years, which could quickly put the public debt trajectory back onto an upwards path. While the sovereign’s external debt repayments look manageable for the next few years, it looks increasingly likely that the government won’t be able to honour its obligations once debt repayments ramp up from 2026.

Become a client to read more

This is premium content that requires an active Capital Economics subscription to view.

Already have an account?

You may already have access to this premium content as part of a paid subscription.

Sign in to read the content in full or get details of how you can access it

Register for free

Sign up for a free account to gain:

  • Unlock additional content
  • Register for Capital Economics events
  • Receive email updates and economist-curated newsletters
  • Request a free trial of our services

Get access