Ecuador to Foster Economic Recovery with Support from $500 Million IDB Loan

Ecuador will promote economic recovery, macroeconomic stability, and social protection with assistance from a $500 million loan from the Inter-American Development Bank (IDB).

The program was structured under the Special Development Lending (SDL) category and will be disbursed in a single tranche. Its specific objectives are ensuring fiscal sustainability while safeguarding social safety nets and strengthening money market stability. This operation complements fiscal consolidation efforts agreed upon by the Ecuadorian government and the International Monetary Fund.

Planned budgetary support will help meet short-term financial needs, stimulate economic recovery, and provide resources for social protection networks. In particular, it will help shore up the primary fiscal balance, expand the scope of social programs for vulnerable families, bolster international reserves, and strengthen debt management.

The program will directly benefit the county at large by contributing to its macroeconomic stability through fast-disbursing resources to finance short-term balance of payments needs and the government’s financing requirements. The loan provides a strategic framework to advance a program of structural fiscal reforms. 

The program will also directly benefit more than 300,000 vulnerable families by expanding the coverage network of social programs, and will indirectly benefit all citizens through economic recovery that will increase opportunities for high-quality, productive jobs.

The $500 million loan is for a 7-year term, with a 3-year grace period, and an interest rate based on LIBOR.