After a considerable slowdown in Ecuador s construction industry growth in ----, we expect growth to remain modest over the next few years. We forecast an average real growth of -.- in real terms between ---- and ----, a further downgrade this quarter compared to our previous forecasts. This is low compared to the -.- average growth rate between ---- and ----. � Falling oil prices will have a detrimental impact on the government s capacity to spend in infrastructure development, particularly for projects in the planning stage. Our Oil & Gas team forecasts Brent to average USD--.- per barrel over the next five years. ...The government is implementing regulations and laws to drive the PPP plan, including ports and highway projects. The schemes, which are expected to cost about USD-.-bn, could be developed on a build-operate-transfer basis.
...This quarter, we have further downgraded Ecuador s construction industry growth outlook over the coming two years as a result of our Country Risk team forecasting an economic contraction over ---- and ----, following the strong decrease in oil prices. Ecuador s construction industry will grow by a modest -.- yearly average over ---------. ...As Ecuador is highly dependent upon oil revenue for infrastructure investment, our modest forecasts are in line with our Oil & Gas team s expectation for the price of oil going forward. We expect the construction industry, and notably the transport sector, to benefit from heightened foreign investment as the government utilises the PPP model to kick start infrastructure development, with the port sector to be the first to benefit. With the government having recently awarded two high-value projects, and another out to tender, ports will be a major driver of growth; however, we do note concerns over lack of transparency in the tendering process. ...We expect the construction industry, and notably the transport sector, to benefit from heightened foreign investment as the government utilises the PPP model to kick start infrastructure development, with the port sector to be the first to benefit. With the government having recently awarded two high-value projects, and another out to tender, ports will be a major driver of growth; however, we do note concerns over lack of transparency in the tendering process.
...Ecuador s business environment continues to pose significant risks to investors as reflected in the country performance in our Risk/Reward Index for Latin America where it ranks -th out of -- countries. The country holds the highest score for Industry Rewards in the region with --.-, significantly above the regional average of --.-. ...
