Costa Rica Economic Forecast

Costa Rica Economic Outlook

October 13, 2020

The economy contracted sharply in Q2 as pandemic-related restrictions took their toll on activity. Moreover, available data for Q3 suggests that economic conditions remained lackluster: Economic activity dropped at a record pace in July and August, while and both exports and imports shrank in August, and the unemployment rate remained high, although it ticked down in August. However, restrictions were further eased on 9 September, boding well for activity heading into Q4. In other news, a fourth extraordinary budget for 2020 was presented on 5 October, in a bid to further cut spending. Meanwhile, the 2021 draft budget submitted in early September includes an increase in the fiscal deficit to 9.9% of GDP, from an estimated 9.3% this year. Additionally, President Quesada stated his intention to withdraw the proposed austerity plan drawn up to secure a USD 1.75 billion IMF loan, amid street protests and opposition objections.

Costa Rica Economic Growth

Economic activity will shrink notably this year as the pandemic weighs heavily on domestic and foreign demand and the unemployment rate rises. In 2021, the economy is set to rebound, although lingering uncertainty regarding the evolution of the virus poses a threat to the recovery, and could delay household spending decisions. FocusEconomics panelists see GDP contracting 4.9% in 2020, before growing 3.0% in 2021, which is up 0.1 percentage points from last month’s projection.

Costa Rica Economy Data

2015 2016 2017 2018 2019
Population (million)
GDP per capita (USD)11,29211,65911,76912,05412,171
GDP (USD bn)54.857.258.460.561.8
Economic Growth (GDP, annual variation in %)
Consumption (annual variation in %)
Investment (annual variation in %)3.04.8-2.53.0-6.4
Unemployment Rate9.69.59.312.012.4
Fiscal Balance (% of GDP)-5.7-5.2-6.1-5.8-7.0
Public Debt (% of GDP)
Money (annual variation in %)6.12.1-1.0-0.46.2
Inflation Rate (CPI, annual variation in %, eop)-
Inflation Rate (CPI, annual variation in %)
Inflation (PPI, annual variation in %)-  -  -  -  -  
Benchmark Interest Rate (%)5.954.455.956.005.75
Exchange Rate (vs USD)537.3553.2571.4604.5571.0
Exchange Rate (vs USD, aop)534.6544.0567.9577.2586.9
Current Account (% of GDP)-3.5-2.2-3.4-3.3-2.5
Current Account Balance (USD bn)-1.9-1.3-2.0-2.0-1.5
Trade Balance (USD billion)-5.5-5.3-5.3-5.3-4.7
Exports (USD billion)9.29.910.611.311.5
Imports (USD billion)14.715.215.916.616.1
Exports (annual variation in %)
Imports (annual variation in %)-
International Reserves (USD)
External Debt (% of GDP)43.144.746.447.949.7

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Costa Rica Facts

Value Change Date
Exchange Rate571.0-0.57 %Jan 01

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