In an economic year characterized by recession and hardship, Costa Rica’s Central Bank (BCCR) this week released a glimmer of good news that indicates a slow recovery seems to be in the works.
The Costa Rican economy grew during the months of September and October compared to its growth during the same months of 2008, according to the BCCR’s monthly index of economic activity (IMAE).
The IMAE, an analysis of output for goods and services of close to 800 businesses, revealed that the economy grew 1.36 percent in October versus where it was last year. The index also revised its results from September, and – after initially reporting a 0.1 percent economic decrease – found that the economy actually experienced a 0.37 percent increase.
Prior to September, the IMAE measured economic decreases during 11 consecutive months.
“Without question, 2009 was one of the most difficult years we’ve ever had to deal with in the Costa Rican economy,” BCCR President Francisco de Paula Gutiérrez said Tuesday. “The positive aspect is that in the last few months things have started to stabilize and show the first signs of recovery.
We think that the growth at the end of the year represents that 2010 will bring stronger economic results.”
The BCCR predicts the country’s gross domestic product (GDP) will fall 1.3 percent this year and rebound for an estimated 2.5 percent growth in 2010.
Driving the green shoots in October was the increased output in production manufacturing, which jumped 2.3 percent from the previous year. The reported growth stemmed from increased production in the free-trade zones, which are principal locations for export-geared production.
Other areas of increased production were transportation, storage and communications, as well as health and education.
The sectors of the economy that showed decreases in output in October, as compared to the same month in 2008, were hotels and construction. According to the Costa Rican Tourism Board, more than 4,000 fewer tourists visited the country in September of this year than in the same month last year. In October 2009, 12,000 fewer tourists visited than in that month of 2008. The tourism sector forecasts for this year a 10 percent drop from last year’s arrivals.