Strong growth of remittances and savings in the oil bill are two of the factors responsible for an increase in the supply of dollars which is putting downward pressure on its price against the quetzal.
Appreciation of the Guatemalan currency against the US currency is also due to lower demand for dollars in the local market, according to statements made by the president of the Bank of Guatemala to S21.gt.
In Costa Rica, 19 projects were selected as "eligible" by the state run power company, but the same institution has ruled out opening new competitions to purchase more wind-generated power.
Investment in alternative energy is risky, because it depends on uncontrollable external factors such as unpredictable weather variations, which have particular effects on hydraulics, solar and wind power.
An increased supply of imported pork has caused a general price reduction and increased annual per capita consumption by two kilos.
Demand for pork in Costa Rica increased from 11 kilograms (kg) per capita in 2014 to 13 kg per capita in 2015, according to figures from the Costa Rican Chamber of Pork Producers (Caporc) cited by Nacion.com.
Producers in Costa Rica must further improve their productivity if they want to compete with the low prices offered for the same product internationally.
Currently a quintal of the grain sells in Costa Rica for around $40, whereas inside the Costa Rican market producers are trying to sell their harvest for $60, arguing that industrialists are offering them at lower prices in order to buy their production. This is not the first time that this difference in price has arisen, and this time, the government has said it will buy part of the local crop from producers in the south "... at a price that is double the price from abroad".
The private sector has called on the government to take measures to stimulate the arrival of more tourists and prevent the oversupply that exists in sectors such as the hotel industry from harming the economy.
Although steps have been taken, such as the agreement between the Tourism Authority of Panama and Copa Airlines and Air Panama to promote the country on its flights, the private sector is calling for more changes in the policy of encouraging this and other economic activities, at a time when the supply of services linked to tourism, far exceeds demand.
While occupancy rates and average prices continue to fall, the Panamanian hotel market is preparing to increase its supply by another 1,200 rooms at the end of the year.
The Panamanian Association of Hotels (Apatel) reports that in recent years there has been a 209% increase in the number of rooms available in the country, in contrast to demand which has only grown by 5% annually.
Over the next few months 17 local fast food and 'casual' restaurants will be opened as well as 35 cafes and 4 supermarkets.
Despite announcements of the closure of several companies in recent months, the commercial sector seems to have not stopped growing, with the coming months seeing the opening of 19 fashion stores, 6 appliance stores, 7 hotels, and 8 office complexes, among others.
Predictions are that the office vacancy rate in Panama City, currently 33%, could reach 45% in 2016.
Following that under usage prevailing in the office market rental rates have dropped by up to 30%. In the case of hotels, they are also experiencing this phenomenon, the vacancy rate has fallen by 50% and in turn nightly rates have decreased by 28%.
Sugarcane growers estimate that exports from the 2013/2014 crop will be reduced by 10% due to the negative effects of climate and oversupply in the global market.
In recent months, a decrease in the price of sugar has been more evident, "... a hundredweight went from being quoted at $24 two years ago, to $19 in March 2013 and now to $15 ... therefore producers have lost between 5% and 10% of their income. "
An overproduction of corn, wheat and rice in China and a record crop which is expected this year in the United States will continue to push international prices down.
While drought in Central America ravages crops of basic grains such as corn, it is estimated that this year China will have a reserve of 150 million tons of grain, "... including three of the most important crops in China: rice, wheat and corn. The figure is double the 75 million tonnes produced last year and adds to the abundance of agricultural commodities which is undermining prices. "
Although since 2011 the construction of hotels has shown a downward trend, 23 new projects requested a declaration of interest in order to start operations in the country.
Figures from the Construction Chamber show that between 2011 and 2013 the total square meters approved for construction of new hotels dropped from 140,670 m² to 51,975 m². However, it seems that the sector us beginning to recover, as there are 23 projects that were declared of interest by the Costa Rican Tourism Institute (ICT) that are under construction or have received approval to start work.
In Panama the increase in room supply has caused a price war between hotels trying to attract travelers and increase the occupancy rate which on average is not more than 60%.
Hotel occupancy in the country has been declining since 2011, when it stood at 68.6% dropping to 59.3% within the sector this year, according to figures from the Tourism Authority of Panama (ATP). In contrast to this, the number of tourists arriving in the country and the expenditure made during their stay in the country has not stopped growing.
Although the number of tourists coming to Panama City continues to grow, there is still an oversupply of rooms, and in the last 3 years average occupancy has fallen by 10%.
The prevailing oversupply in the sector has begun to affect hotels, whose financial profits have been reduced by 20%. Currently the supply of rooms is 40 thousand, 8000 more than in and 2009 and although the number of tourists arriving in the country has not reduced, the percentage of unoccupied hotel rooms has reached 45%. The Panamanian Chamber of Tourism recognizes that the situation is worrying and is demanding institutional action in order to increase occupancy by 2015.
Hospitality and tourism division of Empresas Bern, a Panamanian company with 30 years of experience in real estate development, construction and sales.
Operates in Panama
Phone: (507-) 206-8843 - (507) 6647-6100