Costa Rica Economic Activity March 2021

Costa Rica

Costa Rica: Economic activity swings back to growth in March

May 12, 2021

Economic activity expanded for the first time in 13 months in March, growing 3.9% in annual terms, swinging from February’s 4.5% contraction. That said, the reading was supported by a low base effect.

Looking at the details of the release, March’s upturn was broad based. Output in the mining and quarrying, and manufacturing sectors expanded at a faster clip in March. Meanwhile, activity in the transportation and storage sector, as well as the hospitality and food sectors decreased at markedly softer paces, supported by a favorable base effect.

On a calendar-adjusted monthly basis, economic activity rose 0.3% in March, matching February’s print. Meanwhile, the trend pointed up slightly, with annual average variation of economic activity coming in at minus 5.1% in March, up from February’s minus 5.9%.

Commenting on the outlook, analysts at EIU, noted:

“We expect the Costa Rican economy to grow by 2.7% in 2021, which represents only a partial recovery from the 4.6% contraction in 2020, with output not returning to prepandemic levels until later in 2022.[…]The rollout of coronavirus vaccines (domestically and in the U.S., Costa Rica's main tourism market) will result in a gradual economic recovery in the coming quarters.”

FocusEconomics Consensus Forecast panelists project the economy to expand 3.2% in 2021, which is up 0.1 percentage points from last month’s forecast. In 2022, panelists forecast the economy to grow 3.4%.

Author:, Junior Economist

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Costa Rica Economic Activity Chart

Costa Rica Economic Activity March 2021

Note: Year-on-year changes and annual average variation of trend-cycle economic activity in %.
Source: Costa Rica Central Bank (BCCR).

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