The fu­ture looks bright in Quito, Ecuador

Not only is Quito in Ecuador one of the high­est al­ti­tude cities in the world – it is also on the up when it comes to eco­nomic po­ten­tial

Business Traveller (Asia-Pacific) - - CONTENTS - WORDS DANIEL SCHEFFLER

Fly­ing into Quito, the first thing I no­tice is how much more spread out it is than I ex­pected. The sec­ond is that we still seem high up. At 2,850 me­tres, the city sprawls across the eastern flank of Pich­in­cha, an ac­tive vol­cano – after Bo­livia’s La Paz, it is the sec­ond-high­est al­ti­tude cap­i­tal city in the world. We cruise from the smart new air­port, opened in 2013, to the old town, which has a quintessen­tially colo­nial South Amer­i­can feel. In 1978, the his­toric cen­tre was made one of the first UN­ESCO World Her­itage sites in the world, and its churches, con­vents and pub­lic struc­tures have re­cently been metic­u­lously reconditioned.

From the rooftop of the 16th-cen­tury domed Metropoli­tan Cathe­dral of Quito on the Plaza Grande, the view is awein­spir­ing. The winged Vir­gin Mary, Loma El Panecillo, sur­veys the city from a neigh­bour­ing hill­top, with green­ery from the ur­ban Par­que Metropoli­tano and snow­capped moun­tains in the dis­tance. Mean­while, across town, the Basílica del Voto Na­cional, an im­pos­ing neo-Gothic church, vies for at­ten­tion.

The UN­ESCO tagged old town has a quintessen­tially colo­nial South Amer­i­can feel


Quito, home to around 2.6 mil­lion peo­ple, is the cen­tre of gov­ern­ment in Ecuador. The Na­tional Assem­bly is here, as is the pres­i­den­tial palace. In the past, Quito’s big­gest in­ter­na­tional play­ers were oil com­pa­nies, such as An­des Petroleum and Hal­libur­ton, but change is in the air thanks to a sur­feit of young en­trepreneurs. With a new gov­ern­ment elected in 2017, it is now pre­par­ing to re­ceive the world.

Some of the city’s most im­pres­sive de­vel­op­ments are al­ready un­der way, and build­ing sites and cranes are ev­ery­where. For in­stance, the em­ploy­ment-cre­at­ing un­der­ground metro will be open­ing mid-2019, and a cross-city ca­ble-car sys­tem is planned for around the same time.

New tourist ac­com­mo­da­tion is an­other facet of the city’s con­tin­ued rein­ven­tion. New de­sign ho­tel Car­lota and lux­ury bou­tique prop­erty Illa Ex­pe­ri­ence ho­tel, are both in the his­toric cen­tre in pe­riod build­ings that have been beau­ti­fully and sen­si­tively mod­ernised for the 21st-cen­tury trav­eller.

“Po­lit­i­cal and eco­nomic sta­bil­ity were never Ecuador’s strength in the past,” says Quito restau­ra­teur Jan Niedrau, whose restau­rant Zazu is a Re­lais & Châteaux mem­ber. “Gov­ern­ments were fre­quently over­thrown by the peo­ple, cor­rup­tion has been an is­sue for a long time and a dev­as­tat­ing eco­nomic cri­sis has struck the coun­try.”

But as Niedrau points out, Ecuado­ri­ans sim­ply got used to this in­sta­bil­ity. “Quite fre­quently you will hear peo­ple com­ment that Ecuador in this sense is ‘like a cork swim­ming on water’. The waves will rock and shake it, but it will al­ways float’,” he says.


How­ever, the road to real growth can be wind­ing. Re­search com­pany Fo­cus Eco­nom­ics projects the GDP growth to slow to 1.7 per cent in 2018, while 1.3 per cent is al­ready fore­cast for 2019; good, but not great. Which for Pres­i­dent Lenín Moreno, who was re­cently granted a long-sought-after man­date to im­ple­ment con­sti­tu­tional changes and pur­sue a more global-fac­ing agenda, must be rather dis­ap­point­ing. The re­duced oil out­put, along with planned aus­ter­ity mea­sures (to re­duce the debt bur­den) is im­pact­ing over­all eco­nomic ac­tiv­ity. And ac­cord­ing to the World Bank, the na­tion’s high depen­dence on ex­ter­nal bor­row­ing, paired with not hav­ing its own cur­rency (it uses the US dol­lar), is what could po­ten­tially jeop­ar­dise long-term fi­nan­cial sta­bil­ity.

But the eco­nomic out­look isn’t all doom and gloom. In 2017, Ecuador joined the EU’s trade pact with Colom­bia and Peru, agree­ing to elim­i­nate high tar­iffs and tackle tech­ni­cal bar­ri­ers to trade. Ac­cord­ing to the Coun­cil of the Euro­pean Union, the agree­ment “in­cludes com­mit­ments on the en­force­ment of labour and en­vi­ron­men­tal stan­dards, as well as rapid and ef­fec­tive dis­pute set­tle­ment pro­ce­dures.”


“His­tor­i­cally, Ecuador was known as a sup­plier of cheap raw ma­te­ri­als – par­tic­u­larly prod­ucts such as bananas, roses and ca­cao, with prawns the big­gest – in ad­di­tion to oil,” says Jerry Toth, co-founder of To’ak, a high­end choco­late com­pany based in Quito. “This type of econ­omy gen­er­ally presents a coun­try with a very low ceil­ing of eco­nomic de­vel­op­ment. The gov­ern­ment recog­nises this, and for the last five years has en­cour­aged Ecuado­rian busi­nesses to steer their fo­cus to­wards ‘fin­ished goods’, par­tic­u­larly from raw ma­te­ri­als that are pro­duced in-coun­try.

“This isn’t the kind of thing a coun­try can change overnight,” Toth con­tin­ues, “and Ecuador still has a long way to go. The coun­try would sell its premium ca­cao at bulk prices, with low mar­gins, to choco­late mak­ers in coun­tries such as Switzer­land and the US, who used their spe­cialised skills to pro­duce the ‘fin­ished good’ of choco­late, which com­mands higher mar­gins.”


Ecuador, al­though a rel­a­tively small coun­try, has some of the world’s most bio­di­verse ar­eas – from the Ama­zon rain­for­est and the An­dean moun­tains out to the Gala­pa­gos Is­lands. Ac­cord­ing to its of­fi­cial tourism agency, it is home to 18 per cent of the world’s bird species and orchids, 10 per cent of the world’s am­phib­ians and 8 per cent of the world’s mam­mals. But, this is un­der threat from oil ex­plo­ration, agri­cul­ture and min­ing. Canopy Bridge, a non-profit net­work based in Quito, aims to help. It is con­nect­ing in­dige­nous farm­ers with buy­ers from the city and runs many ed­u­ca­tional pro­grammes pro­mot­ing bet­ter en­vi­ron­men­tal con­sid­er­a­tions for both Ecuado­ri­ans and over­seas vis­i­tors.


Quito is also the brain of what you could call the “Sil­i­con An­des”. The Yachay Tech Univer­sity, with a cam­pus just out­side the city, is part of a gov­ern­ment project to es­tab­lish a hub for tech­no­log­i­cal in­no­va­tion and knowl­edge-in­ten­sive busi­nesses. The idea is that the univer­sity uses its US$400 mil­lion an­nual bud­get to col­lab­o­rate with pub­lic and pri­vate re­search in­sti­tu­tions.

But there is much more go­ing on be­yond this. In the past year, the emer­gence of food and bev­er­age start-ups are most ev­i­dent, par­tic­u­larly craft beer and choco­late. Now there are many dozens of Ecuado­rian beer brands, all of which are small and lo­cal, but as Toth points out, “le­git­i­mately good”.

“Quito has al­ways been im­por­tant to me for many rea­sons, the first of which is that I’m from here,” says busi­ness­man and ecol­o­gist Roque Sevilla. “Se­condly, I was mayor of Quito from 1998 to 2000, so I’ve re­ally got­ten to know it well. For Quito the era of dig­i­tal­i­sa­tion is gain­ing mo­men­tum and, once it goes into full force, it will help fa­cil­i­tate com­pa­nies and busi­nesses here in a big way.” It also helps that in­ter­net and mo­bile con­nec­tiv­ity are among the fastest on the con­ti­nent, ac­cord­ing to mo­bile phone provider Mo­vis­tar.

Ecuador has some of the world’s most bio­di­verse ar­eas, from the Ama­zon to the Gala­pa­gos

Pa­tri­cio Alar­con, the pres­i­dent of the Cham­ber of Com­merce, says the city has a fairly de­vel­oped en­tre­pre­neur­ial ecosys­tem, with cowork­ing spa­ces, in­no­va­tion spa­ces and in­cu­ba­tors through­out. “IMPAQTO (a co-work­ing com­mu­nity) is one of the most de­vel­oped co-work­ing spa­ces, rent­ing out part of its in­fra­struc­ture to com­pa­nies such as Spain’s ve­hi­cle hire com­pany Cab­ify,” he adds.

Cur­rently, around 50 start-ups based in Quito are listed on the Startup Rank­ing web­site, with e-learn­ing plat­form Cues­tionarix and hu­man re­sources spe­cial­ist Eval­ rank­ing high­est in Ecuador (points are given for im­por­tance on the in­ter­net and so­cial in­flu­ence). So it’s no won­der I can find ac­tiv­i­ties such as Start Up Week­end, which took place in April, and busi­ness ini­tia­tives from or­gan­i­sa­tions such as Kruger Cor­po­ra­tion, which sup­ports and mo­ti­vates via its lab for start-ups.


In the World Bank’s Ease of Do­ing Busi­ness in­dex, Ecuador cur­rently ranks 118 out of 190 coun­tries – one slot be­hind Ar­gentina and four ahead of Uganda. This is an im­prove­ment from five years ago when it was ranked 139. “In 2006, be­fore the start of for­mer Pres­i­dent Rafael Cor­rea’s gov­ern­ment, I re­mem­ber hav­ing to wait in lines for hours on end and hav­ing to hire a trami­ta­dor (mid­dle­man) for even the most triv­ial pa­per­work,” says Mar­cel Perkins, owner of the Illa Ex­pe­ri­ence ho­tel. “This was usu­ally a friend or part­ner of the per­son be­hind the desk at pub­lic of­fices. Nowa­days most pa­per­work can be done on­line or quickly with­out hav­ing to pay any­one for these ser­vices. You can in­cor­po­rate a com­pany in a few days and be up and run­ning with your busi­ness ideas quickly. Trade­marks can be regis­tered eas­ily, there are sev­eral me­di­a­tion and ar­bi­tra­tion cham­bers to help solve prob­lems and en­sure busi­ness goes smoothly in gen­eral. “In the tourism in­dus­try, in­fra­struc­ture has moved on in leaps and bounds, and Ecuador has gone from be­ing a pot­hole-rid­den coun­try that would de­stroy the stur­di­est 4x4s, to hav­ing some of the best roads in South Amer­ica,” adds Perkins, who also owns Latin Trails, a lo­cal tour op­er­a­tor.

And now, with the larger, im­proved air­port, which opened out­side the city five years ago, many air­lines feel com­fort­able to use this as a hub. Quito re­cently wel­comed Jetblue, United Air­lines and Air Europa, while from May 2019, Air France's Joon is sched­uled to op­er­ate di­rect ser­vices from Paris.

In the World Bank’s Ease of Do­ing Busi­ness in­dex, Ecuador cur­rently ranks 118


“Over the past few years a sense of pride has grown in the younger pop­u­la­tion. New grad­u­ates are study­ing gas­tron­omy, tourism, hote­lier­ing, arts and mu­sic – all re­lated to res­cu­ing Ecuador’s her­itage,” says Perkins. The re­sult is the rise of many restau­rants of­fer­ing haute cui­sine and in­ter­na­tional fu­sion with lo­cal in­gre­di­ents, in­ter­est­ing mu­sic venues show­cas­ing lo­cal artists, mi­cro brew­eries that use lo­cal grains, new types of city tours that in­volve unique ex­pe­ri­ences and eclec­tic bou­tique ho­tels.

“The city of Quito has be­come a metropoli­tan cap­i­tal with cos­mopoli­tan views that em­braces mod­ern life­styles; the city is in­clu­sive to mi­nori­ties and, with Ecuador’s no-visa pol­icy, it has be­come home to cit­i­zens from sev­eral na­tions around the globe,” adds Perkins.

The talk on the street is the need for more crowd­sourc­ing, a free-trade area near the air­port for the lo­gis­tics in­dus­try, and pedes­tri­an­is­ing the old town for vis­i­tors – all good ideas for the near fu­ture. “With a solid busi­ness idea and plenty of pas­sion, you will find few places in the world of this size that can com­pete with Quito,” says Niedrau.

Quito has be­come a metropoli­tan cap­i­tal with cos­mopoli­tan views that em­braces mod­ern life­styles

RIGHT: Quito’s Basil­ica del Voto Na­cional

ABOVE AND OP­PO­SITE: An­dean trails above the city; and Plaza Grande in the colo­nial cen­tre

TOP: Ecuado­ri­ans on horse­back

CLOCK­WISE FROMLEFT TOP: A city view; colo­nial-style ar­chi­tec­ture in the his­toric cen­tre; and Flower dis­plays in Plaza El Quinde

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