Costa Rica: Slowdown in Business Loans

Figures up to October 2017 show a 3% YoY growth, well below the 12% increase registered in the same month in 2016.

Monday, January 8, 2018

The slowdown seen in economic activity during the last eleven months is one of the reasons that explain the lower demand for bank loans by companies in the country.

Elfinancierocr.com reports that "...In addition, the rise in interest rates in colones and dollars, the volatility presented by the dollar in the middle of last year, as well as the growing fiscal deficit, prevented companies from finding any stimulus to support the idea that it was a good time to borrow."

This slowdown in business credit is also congruent in the electoral context the country is experiencing, less than a month before the presidential elections.

Regarding expectations for this year, Gabriel Alpízar, corporate director of Finance at Banco de Costa Rica, considers that "...'No one can state with surety that credit is going to be revitalized in 2018, since in part this will also depend on the decisions adopted by the new authorities'."

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