Reducing costs and barriers to foreign trade in Central American economies is key for the region to overcome the economic recession caused by the outbreak of Covid-19.
A report prepared by the World Bank explains that boosting economic activity and employing a higher percentage of the labor force are objectives that can be achieved through reforms that strengthen the private sector and attract investment.
In the context of the economic reactivation, the airline KLM announced that as of June 29 they will resume three weekly flights on the usual Amsterdam-San José-Liberia-Amsterdam route.
KLM will fly on Tuesdays, Thursdays and Saturdays arriving at the Juan Santamaria International Airport at 1:05 p.m. and departing for Liberia at 2:45 p.m. From Liberia it will leave for Dutch soil at 4:40 p.m., according to a press release from the Costa Rican Tourism Board (ICT).
The World Bank predicts that by the end of this year Panama and the Dominican Republic will be the economies of the region that will grow the most, and the countries that will report the lowest increases in their production will be Costa Rica and Nicaragua.
After the region's economies were considerably affected in 2020 by the sanitary crisis generated by the Covid-19 outbreak, the outlook of international organizations for 2021 is encouraging.
Central America must be the driving force behind a globally accepted document that will be vital for the recovery of the global economy and tourism in particular.
The generation of a physical or digital document of global acceptance (like national passports) that certifies that the bearer has been vaccinated against Covid-19 will facilitate the movement of people that has been severely restricted as part of the measures adopted by governments, both locally and internationally, to contain the pandemic.
Strengthening the confidence of economic agents through a solution to the problem of public finances and moving forward with the process of vaccinating the population are key factors for the Costa Rican economy to recover quickly in the new year.
The spread of covid-19 and the restrictions imposed at the local and global levels severely affected most of Costa Rica's productive sectors, to the extent that the unemployment rate climbed to historical levels, several businesses were closed and economic activity fell sharply.
Due to the suspension of several projects and the political, economic and fiscal situation in Costa Rica, it is expected that the economic activity of the construction industry will close the year in the red and for 2021 a scenario of much uncertainty is predicted.
According to data from the Central Bank of Costa Rica (BCCR), the economic activity of construction began to report negative year-on-year variations since December 2018.
Following the reactivation of air transportation and the easing of restrictions on foreign visitors, the Marriott chain announced the reopening of four hotels operating in the country and the Four Seasons will also reopen its resort in Guanacaste.
The year 2020 has been a complex one for the tourism sector in general, since due to the outbreak of covid-19 since March the hotels began a period in which they did not receive income.
As of November 1st, meeting centers and event halls, including hotels, will be able to accommodate business and academic activities for up to 150 people.
In addition, in the specific case of social activities such as tea baskets or weddings, the maximum allowed capacity will be 30 people, also without the inclusion of those in charge of attending the event, reported the Costa Rican Tourism Institute.
In Costa Rica, the number of people visiting commercial establishments, restaurants and entertainment venues has been rising in recent months, but consumption levels are still low, due to unemployment and limited income.
Because of the quarantine caused by the covid-19 outbreak, April was when people stayed longer in residential areas; however, according to Google mobility reports, as of June mobility patterns began to change.
As of June, Central American economies began to show signs of incipient recovery and as of August, Guatemala, Nicaragua and Costa Rica registered the smallest drops in their levels of economic activity.
Since March of this year, the region has faced a severe economic crisis generated by the outbreak of covid-19. The strict quarantines decreed, the closure of borders and commercial establishments, ended up damaging the dynamism of productive activities.
After being closed for more than seven months, starting October 8, about 4,500 establishments that are identified as bars or casinos in the country will be able to reopen to the public.
The bars that reopen will only be able to serve 50% of their capacity and the distance between the backs of the chairs at each table must be at least 1.8 meters.
Verifying the new levels of demand, offering only basic products or services, and delaying investments as much as possible to recover cash flow, are some of the strategies that businesses plan to implement to face the new commercial reality.
Because of the covid-19 outbreak in Central America, governments decreed strict home quarantines and restricted most economic activities and the movement of consumers.
After the unemployment rate in the United States fell from 15% to 8% between April and August, it became evident that at the beginning of the crisis the capacity of recovery that the North American country could develop was underestimated and it is expected that this behavior could boost the economic activity in Central America.
During the first half of 2020, when the first cases of covid-19 began to be reported in the region, forecasts noted that the recovery of economic activity would be excessively slow, due to a significant drop in consumption globally.
As of September 1st, Costa Rica's tourist marinas will be authorized to receive foreign visitors, who must comply with all the requirements established by local authorities.
As a result of the covid-19 outbreak and the closing of the borders decreed by the government, the arrival of foreign tourists to Costa Rican marinas was restricted for more than five months.
Since 2017, commercial activity in Costa Rica has been slowing down, but with the closures of businesses due to the covid-19 outbreak, between March and July of this year, sales have fallen considerably.
In this context of restrictions on movement and social distancing measures, which began in March of this year, approximately 30% of shops were reported to have closed and it is estimated that just in July, sales in the commercial sector fell by 68% compared to the same month in 2019.
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