Because of a possible decline in the dynamism of the advanced economies, the volume of Central American exports is expected to increase by 0.4% in 2018 and by 2.6% in 2019.
According to a report by the Secretariat of Central American Economic Integration (Sieca), a possible decline in trade dynamism in advanced economies is expected by the end of 2018, which could generate consequences in international markets, with downward scenarios in 2019, between two and three percentage points with respect to 2018. This is mainly related to growing trade tensions and more complicated market access conditions than in previous years, involving important trading partners.
The region is expected to conclude 2018 with a rise of just over 4% in the volume exported and just 3.6% in value, due to the fall in international prices of several agricultural products.
According to the International Trade Outlook for Latin America and the Caribbean 2018, published by the Economic Commission for Latin America and the Caribbean (ECLAC), it is expected that this year Central America will export larger volumes at lower prices.
Preserving macroeconomic and financial stability and restoring private sector confidence are part of the IMF's recommendations to the Nicaraguan government to mitigate the impact of the political and economic crisis.
A team from the International Monetary Fund (IMF) visited Nicaragua, and after evaluating the situation of the economy after more than six months of social and political crisis, forecasts a 4% contraction of the Gross Domestic Product by 2018.
Because of the reduction of funds from the Public Investment Program from $552 million in 2018 to $506 million in 2019, construction is expected to suffer negative effects in Nicaragua.
According to Nicaraguan government estimates, construction will fall 21% this year compared to 2017, and in 2019 the contraction could reach 11%.
Regarding the performance of construction in the country, Elnuevodiario.com.ni reports that "...
New World Bank projections estimate that because of Nicaragua's political crisis, the country's GDP will fall 4% this year and 1% in 2019.
According to the expectations of the international organization, Nicaragua will be the only economy that will decrease in Central America, because of the political and social crisis in which the country is involved since last April, it is expected that the Gross Domestic Product (GDP) will decrease 3.8% in 2018 compared to 2017.
Excessive regulation, increased tax charges and geopolitical uncertainty are the main risks to business growth in the region for Central American CEOs.
PricewaterhouseCoopers (PwC) conducted the Global CEO Survey in the Central American region, in which a group of business executives from Central American countries and the Dominican Republic shared their opinions about their economic expectations.
Businessmen in Nicaragua expect to reduce by at least 50% the investments they had previously planned for 2018, waiting for the problems affecting the country to be solved.
The research by the Consejo Superior de la Empresa Privada (Cosep) and the Fundación Nicaragüense para el Desarrollo Económico y Social (Funides), takes place in the context of more than 160 days of political and social crisis, which has severely affected the performance of the country's economy.
Despite the complex situation, pig farmers in Nicaragua estimate that they will achieve their goal of producing and marketing 13,600 tons of pork this year.
According to representatives from the Nicaraguan Chamber of Producers (Caniporc), so far this year pork consumption went down by only 1% and the value of each live animal decreased by 5%, and the reason for this is the social and political crisis that has been affecting the country for more than five months.
Five months after the socio-political crisis in Nicaragua, it is estimated that this year Gross Domestic Product will contract between by 2.1% and 4%, in real terms.
The Nicaraguan Foundation for Economic and Social Development (FUNIDES) has updatedits estimates on the economic and social impact of the crisis in 2018, in which it poses a first scenario that assumes that people and companies will adapt to a "new reality". In this context, the losses in added value would amount to $946 million.
Due to the crisis that has been unfolding in the country since April, the ECLAC has reduced its growth projection for the Nicaraguan economy from 5% to 0.5% this year.
Laprensa.com.ni reports that "...Before the crisis, the ECLAC placed Nicaragua among the fiveLatin Americaneconomieswith the highest growth for this year, with an expansion of GDP of 5% after having grown 4.9% in 2017."
In the context of the difficult situation that Nicaragua is facing, the Ortega administration has announced its projections for agroindustrial production, consumption and trade for the period 2018 -2019.
From a statement issued by the Central Bank of Nicaragua:
August 15, 2018.Authorities at the National System of Production, Consumption and Trade (SNPCC) of the Government of Nicaragua presented to the Central Bank of Nicaragua (BCN), the Production, Consumption and Trade Plan corresponding to the 2018-2019 cycle.
Due to the crisis affecting Nicaragua and paralysis of construction in Panama between April and May, the IMF has reduced the expectation of economic growth for the Central American region from 4% to 3.3%.
The International Monetary Fund (IMF) cut growth forecasts for the Central American economy, due to the uncertainty caused by the situation in Nicaragua and its effect on the region's economic activity, and the impact of the construction strike in Panama, which has halted works on 260 projects nationwide for the last 30 days.
Plant diseases such as rust in coffee plantations, added to an oversupply of sugar worldwide, explain some of the moderate expectations that entrepreneurs have for some of the most important agricultural products in the region.
Representatives of the Coordinating Committee of Agricultural, Commercial, Industrial and Financial Associations (Cacif) of Guatemala believe that the deceleration that has been registered in international prices of some raw materials and agro-industrial products suggest a decline in local production.
The Central Bank has reviewed its projections in the current complicated context, and expects an economic growth rate between 0.5% and 1.5%, and an inflationary rhythm in the range of 6.5% to 8.5%.
According to authorities at the Central Bank of Nicaragua, the "... new projection of economic growth for the year 2018 is between 0.5 percent and 1.5 percent. On the other hand, inflation is estimated between 6.5 and 8.5 percent.In relation to labor, a loss of 85,100 jobs is projected, which is equivalent to a rate of around 6 percent."