THE ANDEAN COMMUNITY: EFFECTS OF TRADE BETWEEN ECUADOR AND COLOMBIA, PERIOD 1990 - 2021

Códigos JEL: F13, F15, F23, F18

Abstract

The purpose of this research is to analyze the economic relations of trade between Ecuador and Colombia within the framework of the Andean Community (CAN) for the period 1990-2021, thus determining the cost/benefit that it has represented for Ecuador and Colombia to be active members of this process of regional integration. It has a quantitative approach, a historical review of the CAN trade statistics is shown, the main characteristics of the organization and its background to date are addressed, presenting an overview of the member countries, their characteristics, their production and their strengths, weighting the evaluation of trade between Ecuador and Colombia with a VEC model that used the variables Balance of Trade Balance between Ecuador and Colombia, and as predictor variables the GDP of Ecuador and the GDP of Colombia, the Index of Type of Bilateral Real Exchange between Ecuador and Colombia (ITCRB). It is concluded that there are differences in the commercial interests of both countries, from the figures of foreign trade, Colombia presents a greater commercial opening in relation to Ecuador, which maintains a recurring trade deficit with Colombia motivated by the increase in the cost of export products. Ecuadorians faced with the rise of the dollar and the lack of monetary policy as a result of dollarization.