U.N. agency forecasts a 5 percent growth rate for Costa Rica

An international assessment of Latin America’s economic status found that Costa Rica is among the countries with highest projected growths in 2012 of all nations in the region.

Researchers who compiled the report expect that Costa Rica will grow by about 5 percent in its gross domestic product this year.

At the beginning of the year, researchers expected that the economy of Latin America overall would grow by 3.7 percent, but they lowered that number to 3.2 in this report.

The report was created by a subsidiary of the United Nations called the Economic Commission for Latin America, also known as ECLAC or CEPAL in Spanish. Commission administrators released the study Tuesday at a conference that took place at their headquarters in Santiago, Chile.

The report mostly dwelled on why researchers had concluded that the economy of Latin America would not grow as much as they initially expected.

They laid the blame on three economic punches over the last four years that began in the global economic powerhouses of the United States, China and Europe and spread to other countries around the world. These difficulties were the global increase in food and fuel prices in 2008, the economic recession in late 2008 and 2009 and the international uncertainty that slowed the global economy late in 2011.

However, the researchers said in the report that increased
private demand in most countries’ local markets have kept
economies progressing slowly but surely. Additionally, the study says that many governments initiated policies that have kept economies stable.

Overall, the report predicts that Central America will grow far more than the rest of Latin America. It indicates that the region will grow by 4.4 percent of its overall gross domestic product while South America will grow by 2.8 and the Caribbean by only 1.8.

Panamá is expected to lead the growth by far with 9.5 percent, followed by Haiti with 6 and Peru with 5.9. Nicaragua is also expected to grow at the same rate as Costa Rica at 5 percent.

The downgrade of Latin America’s expected economic growth overall is attributed to particularly a slow year in the regional commercial powerhouses of Brazil and Argentina. Additionally Paraguay is the only country that researchers expect to shrink this year, by 2 percent, because of an extremely poor soy harvest.

Costa Rica’s growth since 2010 has been fluctuating according to the study, falling from 4.7 that year to 4.2 in 2011. This year researchers expect that growth will shoot up again to 5 percent and then slow again next year to 4.

Researchers wrote in the report that they expect that most countries with higher than average growth this year to slow down next year, while those countries with less growth will speed up at the same time. This excludes Haiti, whose economy they expect to continue skyrocketing since it was devastated by an earthquake in 2010.

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