Costa Rica Economy 2008

Economy - overview:
Costa Rica's basically stable economy depends on tourism, agriculture, and electronics exports. Poverty has remained at roughly 20% for nearly 20 years, and the strong social safety net that had been put into place by the government has eroded due to increased financial constraints on government expenditures. Immigration from Nicaragua has increasingly become a concern for the government. The estimated 300,000-500,000 Nicaraguans estimated to be in Costa Rica legally and illegally are an important source of (mostly unskilled) labor, but also place heavy demands on the social welfare system. Foreign investors remain attracted by the country's political stability and high education levels, as well as the fiscal incentives offered in the free-trade zones. Exports have become more diversified in the past 10 years due to the growth of the high-tech manufacturing sector, which is dominated by the microprocessor industry. Tourism continues to bring in foreign exchange, as Costa Rica's impressive biodiversity makes it a key destination for ecotourism. The government continues to grapple with its large internal and external deficits and sizable internal debt. Reducing inflation remains a difficult problem because of rising import prices, labor market rigidities, and fiscal deficits. Tax and public expenditure reforms will be necessary to close the budget gap. In October 2007, a national referendum voted in favor of the US-Central American Free Trade Agreement (CAFTA). CAFTA implementation needs to be completed by March 1, 2008 and would result in an improved investment climate.

GDP (purchasing power parity):
$55.95 billion (2007 est.)

GDP (official exchange rate):
$23.29 billion (2007 est.)

GDP - real growth rate:
6.1% (2007 est.)

GDP - per capita (PPP):
$13,500 (2007 est.)

GDP - composition by sector:
agriculture: 8.6%
industry: 29.4%
services: 62.1% (2007 est.)

Labor force:
1.946 million
note: this official estimate excludes Nicaraguans living in Costa Rica (2007 est.)

Labor force - by occupation:
agriculture: 14%
industry: 22%
services: 64% (2006 est.)

Unemployment rate:
5.5% (2007 est.)

Population below poverty line:
18% (2004 est.)

Household income or consumption by percentage share:
lowest 10%: 1%
highest 10%: 37.4% (2003)

Distribution of family income - Gini index:
49.8 (2003)

Inflation rate (consumer prices):
9.3% (2007 est.)

Investment (gross fixed):
20.3% of GDP (2007 est.)

Budget:
revenues: $3.572 billion
expenditures: $3.843 billion (2007 est.)

Public debt:
47.4% of GDP (2007 est.)

Agriculture - products:
bananas, pineapples, coffee, melons, ornamental plants, sugar, corn, rice, beans, potatoes; beef; timber

Industries:
microprocessors, food processing, medical equipment, textiles and clothing, construction materials, fertilizer, plastic products

Industrial production growth rate:
7% (2007 est.)

Electricity - production:
8.349 billion kWh (2005)

Electricity - consumption:
7.776 billion kWh (2005)

Electricity - exports:
70 million kWh (2005)

Electricity - imports:
81 million kWh (2005)

Oil - production:
0 bbl/day (2004)

Oil - consumption:
43,000 bbl/day (2005 est.)

Oil - exports:
2,998 bbl/day (2004)

Oil - imports:
43,640 bbl/day (2004)

Oil - proved reserves:
0 bbl (1 January 2006 est.)

natural gas - production:
0 cu m (2005 est.)

natural gas - consumption:
0 cu m (2005 est.)

natural gas - exports:
0 cu m (2005 est.)

natural gas - imports:
0 cu m (2005)

natural gas - proved reserves:
0 cu m (1 January 2006 est.)

Current account balance:
-$1.259 billion (2007 est.)

Exports:
$9.232 billion (2007 est.)

Exports - commodities:
bananas, pineapples, coffee, melons, ornamental plants, sugar; seafood; electronic components, medical equipment

Exports - partners:
US 27.4%, Netherlands 12.2%, China 11.7%, UK 6.2%, Mexico 5.8% (2006)

Imports:
$11.84 billion (2007 est.)

Imports - partners:
US 41.2%, Venezuela 5.4%, Mexico 5.2%, Ireland 5%, Japan 4.9%, Brazil 4.3%, China 4.1% (2006)

Economic aid - recipient:
$29.51 million (2005)

Reserves of foreign exchange and gold:
$3.915 billion (31 December 2007 est.)

Debt - external:
$7.163 billion (30 June 2007)

Stock of direct foreign investment - at home:
$6.897 billion (2006 est.)

Stock of direct foreign investment - abroad:
$261.3 million (2006 est.)

Market value of publicly traded shares:
$1.478 billion (2005)

Currency (code):
Costa Rican colon (CRC)

Exchange rates:
Costa Rican colones per US dollar - 519.53 (2007), 511.3 (2006), 477.79 (2005), 437.91 (2004), 398.66 (2003)