After analyzing the macroeconomic indicators of the country, the Observatory of the Economic and Social Situation of the National University (UNA) concluded the Costa Rican economy is experiencing a period of stagnation and an increase in income inequality among inhabitants, despite the fact that there’s been a reduction in poverty levels.
For 10 years, production has grown by no more than 5%, projection for 2017 is 4.1%. There is a ceiling,
explained researcher Greivin Salazar.
According to the specialist, demand from the external sector has improved, but has particularly benefited the free zones. In contrast, there is concern about the performance of the non-traditional agricultural export sector and the national-based industrial sector, which show slow increases.
The analysis of the UNA highlighted a high volatility of the short-term economic cycle, which has an average duration of only 8 months, which would negatively affect business expectations and the generation of jobs.
There is also a slowdown in domestic demand, stagnation in the growth rate of consumption and public spending, as well as a drop in investment.
According to analysts, under the current scenario, it is difficult to reduce the unemployment rate of its most recent barrier, close to 9%.
These economists’ forecast is that in the medium term there will be no changes, because more government measures are required.
On the other hand, a significant reduction of poverty was achieved in 2016, but inequality and the perception of lower income grew.
According to the Real Minimum Wage Index, in the last 5 years there has been a real improvement in wages. However, for analysts, this does not necessarily happen in reality.
In the Observatory, it is considered that poverty is likely to be reduced a little more, due to macroeconomic stability, but there will be no improvement in wealth distribution.