Ecuador's 3Q economy slows over weak oil sector

QUITO, Dec 30 (Reuters) - Ecuador's economy slowed to 2.03 percent growth in the third quarter from 4.2 percent in the same period last year due to a weakening oil sector, the central bank said on Sunday.

After several years of steep growth, South America's fifth-largest oil producer has registered a slower economic expansion so far this year.

Ecuador's key oil sector fell 3.91 percent in the third quarter compared to an increase of 2.68 percent reported in the same quarter last year, because of a sharp drop in crude output, the bank said.

President Rafael Correa has said his leftist government would improve the oil sector to boost social spending, but his policies have done little to increase output. His proposed renegotiation of foreign oil contracts and pledges to overhaul the foreign debt have worried investors.

However, agricultural output expanded 1.94 percent, while fisheries grew 1.08 percent. Ecuador is the world's largest banana exporter and is also a top exporter of coffee, shrimp and tuna.

Ecuador expects its economy to grow by 2.65 percent this year, one of the slowest expansions since the Andean country adopted the U.S. dollar in 2000 after a crippling economic crisis.

(Reporting by Carlos Andrade; translated by Alonso Soto; editing by Vicki Allen)

One would think logic would prevail.....I personally think ARU will negotiate much more favourable terms...just hope it is soon.