Nicaragua: Troubled Economy

The Nicaraguan Foundation for Economic and Social Development indicates that the country will need over $2 billion in external aid for the next three years.

Thursday, July 9, 2009

The economic crisis has reduced government income in great levels, forcing budget cuts and monetary policy changes, while tapping international reserves.

Erwin Sanchéz, in his article in, refers to the report by the Nicaraguan Foundation for Economic and Social Development (FUNIDES): "According to the document, the usage of international reserves in levels consistent with the fixed currency exchange rate of Nicaragua, to attend short term difficulties, is valid and logic, as long as the government receives external support, or fiscal measures exist to compensate the problem."

Funides forecasts that "the imbalances will continue for the next three years, and using international reserves in high levels would be counterproductive."

More on this topic

Nicaragua's External Debt Rises 4.8%

October 2014

Between December 2013 and July this year, the total external debt balance increased by $458.8 million.

A quarterly report by the Central Bank of Nicaragua (BCN) shows that the country's foreign debt (including private and public debt) closed at $9,843.9 million this June.

The Healthy and Sick Fiscal Deficits of Central America

December 2013

While Nicaragua and Panama have sustainable levels of public debt, for El Salvador, Honduras and Costa Rica the prognosis is "reserved" .

Recent analysis by the Central American Institute for Fiscal Studies (Icefi) reflects very different fiscal situations in each country.

Public Finances, the Weak Link of Costa Rica

January 2011

Aldesa analyzed the Macroeconomic Program 2011-12, by the Central Bank of Costa Rica, with projections for 2011.

In our view, one of the most important elements of the program and to which attention should be paid, has to do with projections for public finances.

Given the relative similarity of economic conditions between 2010 and 2011, the most important is the role played by the Central Government in managing the growing fiscal deficit.

Guatemala as seen by IMF

October 2009

Analysis of the Guatemalan economy, as a result of the first revision of the Stand-By arrangement between the IMF and Guatemala.

Economic outcomes.
GDP growth has been slower than expected, and is projected to be below ½ percent in 2009. Inflation plummeted to -0.3 percent (y-o-y) at end-July, due to the decline in commodity prices and weak domestic demand.

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