 The Ecuador Country Assistance Strategy (CAS) is the detailed report on the World Bank's priority areas to assist countries with their own development programs. It describes all of the World Bank's planned operations in Ecuador: lending, studies and other technical assistance. See below for the main points and documents of the current World Bank Country Assistance Strategy for Ecuador. The full documents are available on the top right side of this page, and the print version of the CAS is also available at the Public Information Center. More information on the Country Assistance Strategies
Ecuador Country Assistance Strategy 2003 - 2007 The World Bank Group's first Ecuador Country Assistance Strategy (CAS) since 1993 has three broad objectives: - To consolidate the macroeconomic framework and lay the foundations for diversified and sustainable economic growth;
- To increase opportunities and access to economic resources, while protecting the poor from the impacts of structural reform;
- And to help the authorities build an accountable and efficient government. The new strategy comes at a time of fragile recovery after prolonged economic stagnation in Ecuador. Real economic growth per capita was negative in the 1980s, and zero during 1990-99, while inequality has increased. The proportion of the country's population living in poverty rose from 34 percent in 1995 to 56 percent in 1999, with poverty reaching 77 percent among the rural population. The country fell into an economic crisis in 1999, followed by a rebound which culminated in 3.3 percent GDP growth in 2002. But the recovery is vulnerable on several fronts, including price volatility in petroleum and bananas, Ecuador's two leading exports. President Gutiérrez was elected in November 2002 with support from indigenous people, farm workers and labor organizations. He immediately launched a medium-term development strategy that focuses on promoting economic growth through competitiveness, reducing poverty and exclusion, and fighting corruption. His first steps have included reforming customs, taxes and labor laws to consolidate the Government's fiscal position, and to improve its ability to withstand shocks. The Government is also developing plans to improve coverage and quality of health and education services, and sharpen the targeting of social assistance. The World Bank Group, including the World Bank Institute, International Finance Corporation (IFC) and Multilateral Investment Guarantee Agency (MIGA), plans to support the Government of Ecuador's efforts to meet these goals by providing technical assistance from specialists as well as financing. Specific targets for 2007 include reducing the proportion of the population living in poverty by 25 percent, and increasing spending on social programs from 7.7 to 12.5 percent of GDP. Planned World Bank loans in the social sector will aim to reduce inequality. They include an initiative to raise primary school enrollment from 90 to 95 percent of the eligible population, and a plan to enable health providers to cut the infant mortality rate from 11.5 to 8.8 per 1,000 live births. The Bank will also seek to improve the quality and targeting of Ecuador's existing social assistance programs, conducting assessments to ensure that those who need social support — including members of indigenous and Afro-Ecuadorian communities — receive it. In addition, the CAS proposes job creation programs during periods of economic crisis, and expansion of the number of families who receive assistance when economic conditions suddenly worsen. Anti-poverty efforts in cities require a different approach from programs aimed at the countryside, the CAS concludes. In urban settings, where 60 percent of the population lives, poor families face overcrowded neighborhoods, crime and unemployment. In rural Ecuador, the major problems center on unmet basic needs. One-third of rural households, for example, do not have access to safe water or electricity. Agriculture is the economic mainstay of the countryside and accounts for 11 percent of GDP. But the sector suffers from problems including low productivity, limited diversification, high vulnerability to natural disasters, insufficient quality control and irregular land titling. The CAS envisions a rural productivity and sustainable development project to address these and other problems. To accomplish these social goals, the Bank's strategy calls for support for implementation of Ecuador's strategy of fiscal discipline and macroeconomic consolidation. This will include support for tax reform, to more equitably balance the burden carried by lower and middle-income taxpayers with that of high-income earners, while ensuring revenue flows that enable the government to reduce the size of the public debt. Another series of measures to strengthen the financial sector will widen credit availability by expanding the presence of savings cooperatives and micro-finance providers. (Full text of CAS documents in PDF format at the top right side of this page)
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