In the optimistic scenario, which foresees an end to the crisis in Nicaragua by the end of July, economic growth at the end of 2018 would be only 1.7%, with $400 million losses in added value.
The Nicaraguan Foundation for Economic and Social Development projects that a possible first scenario would be one where "...the government accepts an early exit negotiated and implemented no later than the end of July, thus achieving a framework of understanding focused on the issues of justice and democratization, putting an end to repression, violence and citizen insecurity."
Due to the crisis in the country, the Central Bank has reduced the estimate of economic growth for this year from the range of 4.5% to 5%, to the range of 3% to 3.5%.
Ovidio Reyes, president of the Central Bank of Nicaragua (BCN), explained that "... the hardest and most regrettable thing about this is the generation of employment.We are expecting the loss of 58,300 new jobs as a result of the lower economic dynamics."
After the country registered sales for $282 million in 2017, the sector's union expects this year to surpass what was reported in the previous period by 2%.
Explained by the good performance in exports of cultivated shrimp, crab and live lobster, during the first three months of the year, the Nicaraguan Institute of Fisheries and Aquaculture (Inpesca) expects the sector to register an increase compared to 2017.
Although the exports in this sector fell 9% during the past year, the union expects that in 2018 sales abroad could grow by 17%.
According to figures from the Central Bank of Nicaragua, sales abroad made by the mining sector totaled $338 million in 2017, which represents a reduction of 9% compared to the amount reported in 2016.
According to projections by the Nicaraguan fishing sector, this year growth could be explained, mainly, by the performance of the production of lobster, sea cucumber and fish.
After the local fishing industry registered $282 million in sales abroad in 2017, the Central Bank of Nicaragua and the Nicaraguan Institute of Fisheries and Aquaculture (Inpesca) jointly prepared a projection for 2018, the result of which is an expectation that the sector will grow 7.5%.
Last year hotel and restaurant activities in Nicaragua grew by 6% compared to 2016 and added $500 million to the GDP, which represents 4% of the total production.
According to figures from the Central Bank of Nicaragua, last year the activities of hotels and restaurants "... grew by 7%, favored by an increase in the arrival of visitors from abroad and an increase in arrivals of cruise ships to the country's main ports."
Projections are that this year growth of the Central American insurance sector will be driven by activities in the markets of Costa Rica and Guatemala.
From the report "Prospects 2018: Insurance Sector in Central America" by Fitch Ratings:
Stable Rating Perspective:The rating outlook for the Central Americaninsurancesectoris stable for 2018, given that most of the rated companies maintain a stable outlook on an individual basis.Fitch Ratings believes that the sector shows stable fundamentals, as a result of good profitability levels and high liquidity and capitalization indicators in all countries, which it expects to continue to be reflected in solid balance sheets in companies.
After the year 2017 provided the sector with income of $840 million, 31% more than in 2016, the union has carried out a new review and plans to generate up to $900 million this year.
Representatives of the union in Nicaragua announced that this year they plan to plant between 1,200 and 1,500 hectares, which will be added to the 28,000 already planted in recent years.
In relation to the plans for this year, Salvador Mayorga Sacasa, president of the National Reforestation Association, informed Elnuevodiario.com.ni that "..." this year we expect to increase by between 1,200 and 1,500 hectares.It's a small amount, really, because the country could grow in this sector much more.'"
Standard & Poor's has maintained the rating of B+ for long-term sovereign debt, arguing that economic growth is stable and the burden of public debt remains moderate.
From a statement issued by Standard & Poor's:
On Feb. 16, 2018, S&P Global Ratings affirmed its 'B+' long-term local and foreign currency sovereign credit ratings on the Republic of Nicaragua.
Economic growth in 2017 exceeded expectations, and although the outlook for 2018 is optimistic, the entity points out that there is a need to reduce tax expenditure and rationalize subsidies.
From a statement issued by the IMF:
Economic performance in 2017 was above expectations and the 2018 outlook is favorable. To minimize downside risks, Nicaragua needs to further fortify its policy framework by (i) hastening the implementation of the international taxation law, reducing tax expenditures, rationalizing subsidies, and implementing a comprehensive reform of the Social Security, (ii) enhancing the supervisory perimeter, (iii) reinforcing the AML/CFT framework, and (iv) building financial buffers and further increasing international reserves.
Citizens are less than two months away from going to a ballotage to elect a new government without having discussed the country's priority issues, even though some of them require urgent attention and a deep national discussion in order to find a solution.
Fitch Ratings forecasts that the performance of the banking system will remain stable in 2018, despite the expected slowdown in credit growth.
From a statement issued by Fitch Ratings:
Fitch Ratings-San Salvador-23 January 2018: Fitch Ratings has maintained its stable outlook for Nicaragua's banking system, considering that its financial performance is expected to remain adequate in 2018 despite the anticipated slowdown in credit growth.
The construction trade union intends to sell around 6,000 homes in 2018, a figure which is 20% higher than the amount of units sold in 2017.
For the construction sector, the year starts with the Expo-Casa fair that will be held in February, 60 urban projects will be included in the event and it is expected that 250 houses will be sold.Representatives from the Chamber of Developers of Nicaragua (Cadur) estimate that during Expo-House around $10 million worth of mortgages will be sold, and for the sales projections of 2018 the amount of the credit could reach $170 million.
The union of builders anticipates a good year for the sector, mainly due to an increase expected in the development of road works.
Data from the Central Bank indicates that the construction sector grew 5.4% in 2017, and that this year it could grow 9.9%.This projection is consistent with the expectations of construction entrepreneurs, who believe that the construction of roads and other public infrastructure will underpin the activityof the sector this year.