COSTA RICA

Weak fiscal outlook starts to pose risks to economic activity

BB2

MEDIUM RISK

  • Economic risk

  • Business environment risk

  • Political risk

  • Commercial risk

  • Financing risk

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GDP USD57.057bn (World ranking 77, World Bank 2018)
Population 5mn (World ranking 119, World Bank 2018)
Form of state Presidential, representative democratic republic
Head of government Carlos Alvarado (President)
Next elections 2022, presidential and legislative
  • Stable, enduring democratic framework
  • Favorable business and legal conditions compared to the rest of Central and Latin America
  • Comfortable foreign reserves, covering between 4 and 5 months of imports and moderate external debt
  • Dynamic tourism sector
  • Relatively advanced transition to a greener and sustainable economy
  • High dependency on US (trade, foreign investment in a few large companies, and tourism)
  • Large fiscal deficit with the public debt-to-GDP ratio rising rapidly as a result. Despite December 2018 fiscal reform, concerns remain on implementation and impact.

Trade structure by destination/origin

(% of total)

Exports Rank Imports
United States 37%
1
41% United States
Netherlands 5%
2
13% China
Belgium 5%
3
7% Mexico
Guatemala 5%
4
3% Guatemala
Nicaragua 4%
5
3% Japan

Trade structure by product

(% of total)

Exports Rank Imports
Electrical machinery, apparatus and appliances, n.e.s. 22%
1
12% Electrical machinery, apparatus and appliances, n.e.s.
Vegetables and fruits 22%
2
9% Road vehicles
Professional and scientific instruments, n.e.s. 11%
3
7% Petroleum, petroleum products and related materials
Miscellaneous edible products and preparations 5%
4
6% Telecommunication and sound recording apparatus
Miscellaneous manufactured articles, n.e.s. 5%
5
5% Miscellaneous manufactured articles, n.e.s.

Contact Euler Hermes

Economic Research Team

research@eulerhermes.com

Contact Georges Dib

Economist for Latin America, Spain and Portugal

georges.dib@eulerhermes.com 

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