Costa Rica exhibits a marked dependence on the external conditions present in international markets.
By Ronney Zamora Leiva, professor, Business Administration and Economics Fidélitas University
What are the economic growth projections for next year?
According to the projections of some experts, Costa Rica will have economic growth between 3.5% and 4%, which means that the country will face lower growth than in 2023. It will be this way since external demand will be lower than in 2023 as a result of the international situation in the markets. At the level of domestic demand, which in recent years has not been the driving force of the economy, a slight rebound is expected.
How will government policies impact the economy?
Government policies will maintain their current trajectory, with a Central Bank focused on managing inflation, which is no longer a cause for concern. The entity is likely to continue adjusting its monetary policy to favor a lower rate. Although the Central Bank does not foresee changes in its position regarding the exchange rate, concern will persist in certain economic sectors during 2024.
What are the main economic risks and opportunities that we can foresee?
Costa Rica exhibits a marked dependence on the external conditions present in international markets. In recent years, the growth drive has been closely linked to the external sector. Therefore, the economic outlook and potential threats for 2024 are closely linked to the global situation, with special attention to our nearby markets that represent crucial trading partners. If this growth, led by the external sector, fails to translate into opportunities for the majority of the population, poverty, unemployment and marked inequality will persist, generating situations of insecurity at the national level.
What political changes could influence the economic and social situation?
In the absence of a pre-election year, political changes are likely to have a more muted impact on the economic and social situation. It is anticipated that the government will persist in implementing policies aligned with the political leadership adopted by the president since his assumption of office; It is unlikely that this approach will undergo significant modifications. Social demands are expected to intensify in favor of a country that offers greater security, a lower cost of living, greater employment opportunities, as well as a decrease in poverty and inequality.
What are the technological trends that could affect the economy?
Global technological trends have a disparate influence on various economies, affecting specific activities and sectors in a unique way. The adoption and implementation of 5G technology is one of those trends that could have a significant impact on the Costa Rican economy. The resolution of this matter, which involves politically complex but essential considerations for the country as a whole, is yet to be known.
How do technological innovations impact?
Technological innovations impact business activity. Globalization and the pressure for global competitiveness always drive companies to stay technologically updated, allowing them to improve processes, efficiency and productivity, as well as the proliferation of new products and services that satisfy the demands of their consumers. In this way, 2024 will once again be a year in which productive and service activities must be attentive and implement technological innovations that allow them to grow sustainably.
Are there environmental risks that could impact the economy?
There are currently no perceived environmental risks that could directly affect the economy; However, it is important to highlight that some of these impacts may manifest themselves in the long term, especially in specific economic activities. It is worth mentioning that, due to the geographical location of Costa Rica, the country is always subject to possible impacts derived from natural phenomena such as hurricanes or intense rains, factors that are influenced by the randomness inherent to climate change.
Reference: https://revistasumma.com/costa-rica-algunas-proyecciones-economicas-para-2024/