Costa Rica Economy Profile 2008

Economy - overview

Costa Rica's basically stable economy depends on tourism, agriculture, and electronics exports. Poverty has remained around 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).

GDP (purchasing power parity)

$55.95 billion (2007 est.)

GDP (official exchange rate)

$22.84 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.)

Population below poverty line

16% (2006 est.)

Household income or consumption by percentage share

lowest 10%: 1%
highest 10%: 37.4% (2003)

Inflation rate (consumer prices)

9.3% (2007 est.)

Investment (gross fixed)

20.3% of GDP (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.)

Distribution of family income - Gini index

49.8 (2003)

Budget

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

Public debt

47.4% of GDP (2007 est.)

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 - imports

43,640 bbl/day (2004)

Oil - exports

2,998 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.)

Agriculture - products

bananas, pineapples, coffee, melons, ornamental plants, sugar, corn, rice, beans, potatoes; beef; timber

Exports

$9.232 billion (2007 est.)

Exports - commodities

bananas, pineapples, coffee, melons, ornamental plants, sugar; seafood; electronic components, medical equipment

Exports - partners

US 27.5%, Netherlands 12.2%, China 11.7%, UK 6.2%, Mexico 5.8% (2006)

Imports

$11.84 billion (2007 est.)

Imports - commodities

raw materials, consumer goods, capital equipment, petroleum, construction materials

Imports - partners

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

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)

Economic aid - recipient

$29.51 million (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)

Fiscal year

calendar year