Costa Rican municipalities will have the funds available for infrastructure development that they are are not executing, the ministry of the Presidency reported.
According to nacion.com "We have to get motivated to start the works that have been budgeted for, because the monies are available for this. What is lacking is faster coordination in being able to spend these resources," added Rodrigo Arias, minister of the Presidency.
Like in other Central American countries, economic growth is expected to decelerate, on the back of the U.S. slowdown.
While real GDP growth rose to 4.7 percent in 2007, a record high in the last decade, it is expected to decelerate to 3.2 percent in 2008. However, the monthly economic activity indicator has signaled a mild but steady slowdown thereafter, reaching an average growth rate of 3.2 percent in the year to August.
Business tips to get through the crisis and even take advantage of the opportunities that arise in complicated times.
Uruguay is a country with an economy that is similar to some central american nations, boasting businessmen with considerable experience in financial and economic crisis. A seminar organized by the Institute of Business Studies (IEEM) from the Montevideo University, provided interesting conclusions on the best way to get through this economic crisis.
According to CEPAL, Central America and the Caribbean will be the most affected by the stagnation in tourism due to the financial crisis.
Around 75% of tourist that visit the Caribbean (and who speak English), and 40% of those that visit Central America, and 75% of those that visit Cuba and the Dominican Republic come from developed countries that have been affected by recession, according to the preliminary 2008 Balance Sheet for economies in Latin America and the Caribbean that was recently published by CEPAL.
The funds will be used to deal with the possible lack of liquidity next year due to the international financial crisis.
"This loan will inject Zuniga, who also added that with the funds from the IDB the authorities are seeking to provide "sustainable growth" for the Costa Rican economy.
The effects are already visible, there is a strong reduction in the credit for housing and vehicles, as well as a restriction of credit cards.
This was confirmed by representatives of the sector, after participating in presentation of the fourth report on the economic situation by the Nicaraguan Foundation for Economic and Social Development, Funides.
The plan proposes the creation of a development bank that would offer direct lines of credit to help drive growth in the sector.
The Salvadoran Association of Industrial Companies (ASI) presented the 12-measure proposal that is urgently needed to deal with the crisis.
Napoleon Guerrero, president of ASI, explained that the creation of the financial institution is needed to reform the law that regulates the Mortgage Bank and the Bank for Agricultural Development (BFA) in order to capitalize them and expand financial coverage for the industry.
The system of designation for the IDB loan of $500 million is still under discussion by the authorities of the Central Reserve Bank.
The president of the institution, Luz Maria de Portillo, said that the Board of Directors is still dealing with the matter.
Meanwhile, the productive sectors have expressed their expectation that the funds will be channeled as soon as possible since the funds will help to inject capital into the local economy and to reinvigorate it.
The financial crisis in the US, a vital market for Central American exports, has reduced the demand for textiles, causing a lot of companies to close.
In CA the industry is also facing strong competition from China since 2005 when the textiles quotas in accordance with the World Trade Organization came into effect.
The country that has been most affected is Nicaragua, where this year alone some 19000 jobs have been lost due to the close of at least 9 textile companies in the industrial parks belonging to the Free Zone Corporation.
Outlook Report December 2008 from the Executive Secretariat of the Central American Monetary Policy.
The disruption of prices in the international market for commodities: petroleum, steel, copper, and basic food, and especially, the recent problems with the US financial system and other countries and regions in the world that are affecting employment and other economic variables, are two of the situations that have significant implications for the region.
Edmund Phelps, 2006 Economic Noble peace prize winner, will analyze the effects of short and long term effects on the macroeconomic policies.
He recommends providing incentives for the creation of new companies that generate novel ideas for activating the economy.
How long will the recession in the US last?
There are those who believe that it will last six to nine months more for the financial sector to be able to stand on its feet ...
Tomorrow the Superintendence of Banks (SIB) will request that the Monetary Board approve a modification of the Regulations for Credit Risk Management.
Even though bank portfolios in arrears are not at a critical level, the SIB will request that the Monetary Board make the changes to the rules in order for banks to increase their reserves for bad debts (loans).
The SICA summit ended with a declaration that includes a dozen measures that they are seeking to implement in order to deal with the global financial crisis.
DECLARATION
The session ended with the reading of the "Declaration of San Pedro Sula", which sets out the resolutions that the leaders of the region plan to carry out immediately and in the future, within the framework of a series of meetings that SICA will continue to hold next year.
The elimination or reduction of tariffs for exports to the Panama market under the FTA will be a big help to ease the crisis in 2009.
Practically all sectors have opportunities in the market, representatives of the various chambers all agreed in separate declarations.
The Treaty with Panama came into effect on November 23, but only partially, because the part concerning the removal of tariffs and rules of origin will come into effect starting January 1.
The Ministries of Foreign Affairs and Economic and Social Integration in Central America started a working session to evaluate the possibility of speaking with "one voice" regarding the global financial crisis.
Honduran Minister of Foreign Affairs, Angel Orellana, inaugurated the first session of the meetings which will conclude this evening and at which its is expected that a formal document will be presented to the leaders of the Central American Integration System (SICA), which will convene tomorrow for the XXXIII Ordinary Summit of Head of State and Government of the organization.