Maintaining his coalition in the National Assembly will be one of Noboa’s main challenges in making progress on his agenda
Although Noboa currently has a coalition to facilitate governance in the early months of his presidency, this is something that could change rapidly once the campaigns for the 2025 elections begin. Despite this, businesses can expect greater stability than what was seen during Lasso’s term. The president, who is also a young businessman from a prominent family in the banana sector, plans to advance economic reforms that will not only promote job creation but also signal a pro-business stance. These laws will be submitted under a state of emergency and with urgency at the beginning of his term, increasing the likelihood of approval. Firms can also expect the security situation in the country to improve marginally; however, the outlook for violence is moderate, and Noboa will still face challenges in restoring security.
After taking office as Ecuador’s youngest-ever president last week, Daniel Noboa is slated to face a busy 16-month term. Ecuador is facing a severe crisis, with high crime rates, a drought, and scheduled power cuts, and Noboa has taken care to select key ministers who will work with him on energy, employment, and security. Noboa also needs to boost Ecuador’s full employment rate, which remains below pre-pandemic levels. All of this is framed by the pressure of a growing fiscal deficit.
We expect the president’s first actions to include a state-of-emergency declaration, allowing him to submit two key laws to the National Assembly—an economic reform to lower income taxes and boost employment and an energy reform to remove barriers to electric self-generation to address the El Niño phenomenon. Although further details on these reforms have not yet been disclosed, the president will probably have the backing of the main coalition in the National Assembly, composed of his party, Acción Democratica Nacional (ADN); the party of former President Rafael Correa, Revolucion Ciudadana; and the Social Christian Party (PSC).
Maintaining this coalition will be one of the main challenges that Noboa will have to face to make progress on his agenda and fulfill his plans for re-election. Additionally, the president will need to avoid confrontation between the executive and legislative powers, like the one that former President Guillermo Lasso faced, which caused the “muerte cruzada” that led to his decision to step down. On this front, Noboa has the advantage of having shown a conciliatory personality, evidenced by the relatively non-confrontational campaign he ran against Correa’s party and former candidate, Luisa Gonzalez. This has given him a significant ally in the National Assembly that his predecessor Lasso did not have.
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