Tax Reform is Not Enough

Businessmen in Costa Rica recognize the importance of the fiscal reform needed by the country, but they are calling on the Alvarado administration to pay attention to equally complex problems, such as unemployment and high production costs.

Tuesday, August 7, 2018

The business sector has taken stock of the first 100 days of the government of Carlos Alvarado, and in a discussion outlined the urgent challenges facing the country, such as how to achieve economic reactivation, advancing a proposed teleworking law, promoting dual training and investing in improving road infrastructure. 

See also "Less public spending, finally"

From a statement issued by the Uccaep:

· Business sector recognizes that the tax issue is preponderant, but it is definitely not the only one. 
· Investors talk about urgent issues to be resolved, but above all the need to send positive signals to generate new sources of income.

August 6, 2018.  One week after President Carlos Alvarado Quesada reached the 100 day mark as President of the Republic, the Costa Rican Union of Chambers and Associations of the Private Business Sector (UCCAEP) is taking stock of his leadership and the urgent challenges required by the country to reactivate economically and how to get away from the fiscal cliff edge on which we find ourselves.

The president of the Union of Chambers, Gonzalo Delgado, spoke up for the worrying economic slowdown in the country, a situation that in recent months seems to be increasing. "As a private sector, we are concerned about the economic slowdown in which Costa Rica is immersed.  When the former government of former President Luis Guillermo Solís began, we grew at a rate of 4%, and even a bit more in 2012, exceeding 5%. However, the Central Bank's projection tells us that if anything growth might be 3.2%, which together with the data provided by the Monthly Index of Economic Activity (IMAE), means we were at a level of 2.84%, in April of this year, which denotes a pessimistic path ahead, if no actions are taken now," said Delgado.

In the view of the president of UCCAEP, the situation has been complicated by "the ominous news" released last week, about the fiscal irresponsibility of the Solis administration, which left a funding gap after forgetting to budget ¢600,000 million, almost 1.73% of GDP, estimated by the Central Bank for this year.

"These types of actions generate distrust in the seriousness of the leaders of this country and distrust is the worst enemy of investment," said Delgado. 

Read full statement (In Spanish).

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Boosting the Economy is Urgent

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In addition to the economic rebound, the Costa Rican Union of Chambers and Associations of Private Business Sector (UCCAEP) expects the country not to focus on single-issue discussions, as happened in 2018 with the fiscal plan.

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