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Working in Ecuador
Find out how to get a job and work in Ecuador
There’s more to Ecuador than its valuable natural oil reserves and its agricultural expertise. Our guide gives you an introduction to the industries and businesses that thrive in this tropical Andean nation and how to fit in as an expat.
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Employment in Ecuador
At a Glance:
- Ecuador’s economy mostly depends on oil and agriculture, however increasing numbers of multinational corporations provide opportunities for expats.
- Certain paperwork is required for an Ecuadorian work permit; this needs to be done before you can start working.
- Ecuador has a comprehensive taxation and social security system which applies to anyone who resides in Ecuador for more than 183 days a year.
- Ecuadorians tend to be more people-focused when it comes to business, compared to the strict scheduled routine that many English-speaking expats may be used to.
In the past decade, doing business in and with Ecuador has become increasingly popular. Having recuperated from the crippling effects of a recession in 1998–99, the national economy grew by an average of more than 5% annually. Despite a dip in 2016, the growth trend returned in 2017, albeit being somewhat slower, making working in Ecuador a viable option for expats.
Ecuador: Oil and Agriculture
Ecuador’s economy mainly rests on two pillars: oil and agriculture. The agricultural sector contributes a sizeable portion of the national GDP and is also one of the country’s biggest employers, providing jobs for more than a quarter of the population. The focus of Ecuadorian agriculture is bananas, coffee, and cocoa.
The oil sector is still the most dominant by far. Ecuador’s oil producing sector has not only given many Ecuadorians a secure job, but is also a large factor in drawing expats to the country. Other growth sectors include chemicals, machinery, construction, and electronics.
Ecuador’s main economic strengths are ample reserves of natural resources, a stable banking system with the US dollar as the national currency (see below), and access to the Pacific Ocean. Weaknesses, however, include its dependence on the world market and exports, and the nation’s topography. Another unfavorable factor is the relative scarcity of competing companies — there are a few big players, but far less than in many other countries. Some also consider the large role the government plays within the national economy to be a disadvantage.
Following a deep recession in the late 90s, the nation introduced the US dollar as its official currency in 2001. Dollarization is partly credited with bringing the national economy back on track, considerably improving the conditions and opportunities for everyone working in Ecuador.
As the national economy relies heavily on oil and other exports, job opportunities for expats tend to be limited. However, Ecuador has attracted a fair share of multinational corporations which have established branches or offices to try to benefit from the relatively low production costs and wages.
Free Trade Zones
The four free trade zones (FTZ) in the country give companies and expats numerous incentives for investment and lasting cooperation. Among the benefits for foreign companies in the free trade zones are near-universal tax and customs exemption, security personnel, logistical advantages such as proximity to airports and major cities (three of the four FTZs are located in the Costa region), and modern offices and storage buildings.
Any company that’s planning on working in Ecuador’s travel, industry, import/export, or services sectors is eligible to establish a branch or office in one of the free trade zones. For a detailed insight, read the Ecuadorian Ley de Zonas Francas, which is the legal framework for all FTZs in the country.
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Expat Business Info Ecuador
Getting Permission to Work
Your first stop to legal employment in Ecuador is contacting the Ecuadorian mission in your country and applying for a work permit. You can also find more information on visas in our article on Relocating to the Tropical Paradise Ecuador
Visa requirements include:
- a passport, valid for at least 6 months after departure
- an Aplicación de Visa and Certificado de Visación to be completed at the embassy
- two recent passport-sized photographs (in color)
- a written request from your company to the Ecuadorian Foreign Service Officer in the place of residence
- a CV
The fee for the work visa is 230 USD. For a full list of requirements, see the homepage of the Ecuadorian embassy in your country. The mission in the Netherlands, for example, has a very helpful overview page.
Paying Your Taxes
If you are an expat in Ecuador but spend more than half of any given calendar year outside the country, you will be taxed at a flat rate of 22% of your income generated within Ecuador (2017). Those who live in Ecuador for more than 183 days a year are taxed based on income.
Income is divided into different brackets with a base level of taxation. Anything you earn that’s over the lower threshold of the bracket is then taxed at a fixed percentage. For example, if your income is 50,000 USD, your tax category ranges from 39,830 USD to 59,730 USD. The basic tax rate for this level is 3,861 USD; the tax rate on the sum exceeding the lower limit is 20%, so the total tax due is 5,895 USD.
A detailed, up-to-date overview of all the tax categories and rates can be found on the pages of the Servicio de Rentas Internas.
Social security payments in Ecuador are split between employers and employees, with the government partly subsidizing programs. National social security services are fairly comprehensive, offering programs for old age, disability, sickness, maternity, and unemployment. All things considered, you can expect around 9% of your earnings to go towards the social security fund.
Local Customs and Etiquette
Ecuadorians often focus on people and relationships rather than strictly adhering to schedules. While arriving late to work probably won’t be tolerated, you can expect meetings, both at work and in your leisure time, to take a flexible approach to start times.
Indications of status, such as academic titles, are valued. If you meet or work with someone who has such a distinction, you should address them by it, for example doctor/doctora. You should also make sure to use the formal usted when meeting new business partners or colleagues. In contrast to many English-speaking countries, people usually do not start using first-names to address each other all that quickly.
The expression of emotions, both positive and negative, is very normal in Ecuador. Ecuadorians are, in general, warm and welcoming, and physical proximity is not unusual. For example, to greet one another, men may pat each other on the shoulder and women tend to kiss once on the right cheek. However, don’t worry about this too much — take the lead from local residents and remember that it’s just one of the cultural differences that makes expat life interesting!
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