Costa Rica: Economic growth slows in second quarter
September 28, 2012
In the second quarter, GDP expanded 5.7% over the same period last year. The reading came in below the revised 7.3% increase seen in the preceding quarter (previously reported: +7.2% year-on-year). The deceleration was driven by a deterioration of the external sector. Exports of goods and services slowed from a strong 16.2% expansion in the first quarter to a softer 9.6% increase in the second quarter, while imports moderated at a milder pace and rose 7.9%, below the 9.5% rise tallied in the first quarter. As a result, the net contribution from the external sector to overall growth fell from plus 3.4 percentage points in the first quarter to plus 1.3 percentage points in the second. On the domestic side of the economy, total consumption decelerated to a 4.6% increase in the second quarter (Q1: +5.2% yoy), as both private and government consumption slowed somewhat, increasing 5.0% (Q1: +5.6% yoy) and 1.7% (Q1: +1.8% yoy) respectively. Meanwhile, gross fixed investment decelerated from a 13.0% expansion in the first quarter to a 6.9% increase in the second. A quarter-on-quarter comparison corroborates the slowdown suggested by the annual figures as GDP expanded a seasonally adjusted 0.5% over the previous quarter, well below the 1.6% expansion seen in the previous quarter. According to the latest revision to the Macroeconomic Programme 2012-2013, the Central Bank sees the economy expanding 4.8% this year. For 2013, the Bank expects economic growth to slow to 4.2%.