Report Highlights:
Costa Rica’s economy continues to show healthy growth, estimated at over 10% throughout 2012, and is expected to continue into year 2013. Since the 1980s, Costa Rica has made tremendous efforts to increase tourism and is now considered a popular destination. The country received an accounted two million visitors during 2012 and subsequently showed a increased demand for hotel and restaurant business, as well as for U.S. food products.
Economic Situation
Tourism is one of Central America’s top areas of economic opportunity for 2009-2013, and Costa Rica’s natural beauty extends from the Pacific Ocean to the Caribbean Sea, yet its distance is barely 200 miles across, occupying only 20 thousand square miles. For such a small country, Costa Rica is one of most highly sought after tourist destinations in the region. This small piece of land includes all of the necessary components to satisfy the taste of thousands of travelers visiting each year.
Costa Rica’s territorial division includes 7 provinces, which are: San José, Alajuela, Cartago, Heredia, Guanacaste, Puntarenas, and Limón. Together they offer an attractive tourist destination that include extensive rainforests, volcanoes, rivers running between the mountains, expansive beaches and natural resources safeguarded by an organization of national parks and forest reserves. Tourism is one of the main economic sectors of Costa Rica, representing an important source of foreign currency of Costa Rica’s economy. Since 1999, tourism generates more income than the traditional crops of banana, pineapple and coffee together.
Economic activity is dominated by tourism, agriculture and high technology, and services such as call centers are gaining economic weight. Costa Rica’s Central Bank estimates that GDP grew 5.1 percent in 2012 and it is forecasting 4.0 percent growth for 2013. Inflation reached 4.6 percent in 2012, and it is forecast to increase to about 5 percent in 2013. However, sustained high international oil prices and a high fiscal deficit could result in a higher figure.
The deficit of the Central Government reached 4.4 percent of GDP in 2012 and it is expected to increase to 4.8 percent of GDP in 2013. Debt service continues to constrain government investment in infrastructure and its ability to provide basic services and programs.
