Businessman Noboa to face economic, security hurdles as Ecuador president

investing.com:

By Alexandra Valencia

QUITO (Reuters) -Business heir Daniel Noboa will face significant challenges as he seeks to revive Ecuador's battered economy and tackle rising crime during a truncated 17-month presidential term, after winning the country's top job on Sunday.

The 35-year-old Noboa vowed in his victory speech to rebuild the South American country, whose economy has struggled since the COVID-19 pandemic, motivating many thousands of Ecuadoreans to migrate.

Noboa's victory eliminated some immediate market risks that could have arisen if his rival, leftist Luisa Gonzalez, a protege of former President Rafael Correa, had been elected instead, analysts said.

«The victory of Noboa eliminates, in our view, the tail risks around an early Correista administration pursing constitutional changes facilitating a Rafael Correa comeback in 2025, and accelerating the speed of the fiscal slippage,» J.P. Morgan said in a note on Monday.

Any fiscal consolidation during Noboa's coming term is unlikely, especially if the El Nino weather phenomenon causes significant economic pressures, the note added, but an outright debt restructuring is unlikely.

Noboa has pledged to attract foreign investors and create jobs for young people, but has also said he will balance meeting foreign debt obligations with the needs of the population.

Ecuador has repeatedly turned to multilateral funding since the pandemic.

Doubts remain about whether Noboa will follow an orthodox path on the economy, J.P. Morgan added, because he has said he could dip into $1.5 billion in international reserves if needed.

Noboa's campaign has said he will announce his cabinet picks next week, likely signaling his economic strategy.

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Noboa has said he will tackle