Nicaragua Economic Forecast

Nicaragua Economic Outlook

November 10, 2020

The economy contracted 7.9% in Q2 according to recent data, despite the lack of a domestic lockdown. Exports plunged on lockdowns abroad and the collapse in international travel, while private consumption and fixed investment also fell sharply amid uncertainty generated by the pandemic. However, government consumption growth was solid. Turning to the third quarter, momentum appeared to recover somewhat, with the annual decline in economic activity much softer in July and August amid stronger showings from the manufacturing and mining subsectors. Moreover, remittances surged in the quarter, likely propping up private consumption. That said, the hotels and restaurants subsector remained extremely downbeat, likely as foreign visitors stayed away.

Nicaragua Economic Growth

The economy is seen expanding meekly next year following a sharp downturn this year. Notwithstanding stronger external demand, momentum will be held back by the uncertain political situation. Downside risks stem from a potential resurgence in Covid-19 infections, limited fiscal room for maneuver and deteriorating international relations. FocusEconomics panelists see GDP expanding 1.1% in 2021, down 0.3 percentage points from last month’s forecast, before expanding 2.3% in 2022.

Nicaragua Economy Data

2015 2016 2017 2018 2019
Population (million)
GDP per capita (USD)2,0442,1022,1582,0281,915
GDP (USD bn)12.813.313.813.112.5
Economic Growth (GDP, annual variation in %)
Consumption (annual variation in %)
Investment (annual variation in %)27.7-0.31.2-26.4-30.6
Unemployment Rate-  -  -  -  -  
Fiscal Balance (% of GDP)-1.6-2.0-2.0-4.0-  
Money (annual variation in %)19.110.513.0-19.73.2
Inflation Rate (CPI, annual variation in %, eop)
Inflation Rate (CPI, annual variation in %)
Benchmark Interest Rate (%)12.0311.4410.8510.9012.46
Exchange Rate (vs USD)27.9029.3030.8032.3333.84
Exchange Rate (vs USD, aop)26.5928.2629.7631.5833.00
Current Account (% of GDP)-8.8-6.5-4.90.6-  
Current Account Balance (USD bn)-1.1-0.9-0.70.1-  
Trade Balance (USD billion)-3.5-3.7-3.5-2.7-  
Exports (USD billion)  
Imports (USD billion)  
Exports (annual variation in %)-9.3-8.114.5-1.2-  
Imports (annual variation in %)0.5-0.33.5-14.7-  
International Reserves (USD)
External Debt (% of GDP)82.182.683.188.7-  

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Nicaragua Facts

Value Change Date
Exchange Rate33.472.11 %Jan 01

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