External Financing Needed To Avoid Crisis

BMI View: We forecast Ecuador to post current account deficits of 2.1% and 1.6% of GDP in 2011 and 2012, driven in large part by recurring trade deficits. Moreover, the country's business environment is unlikely to attract significant foreign investment anytime soon, which combined with depleting international reserves could lead to a balance of payments crisis in the medium term if the country does not resort to external financing.

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