Faced with the advance of the coronavirus epidemic, businessmen in the region are asking citizens to follow only official recommendations to avoid giving way to disorienting versions that only contribute to generate instability and uncertainty.
In Central America, two countries have registered people infected with the virus. Costa Rica was the first to report cases of COVID-19 (also known as coronavirus) and so far the nation has registered nine infected people. Panama made its first case official on 9 March.
After production in Nicaragua fell 3.8% in 2018, the IMF estimates that during 2019 the GDP will contract by 5.7%, however, the agency predicts that by 2020 the variation could be only -1.2%.
Real GDP is estimated to have contracted by another 5.7% in 2019 due to the deterioration in aggregate demand, fiscal consolidation and sanctions, the IMF reported after its visit to the country.
During the fourth quarter of 2019, Walmart's sales increased year-on-year in all countries in the region, except in Costa Rica, where they fell because of the lower dynamism of local economic activity.
The signs of recovery reported in the Costa Rican economy in the second half of 2019 do not seem to have been enough to boost retailtrade, as one of the largest supermarket chains is registering a drop in sales.
Because between 2018 and 2019, the consumer's fixed expense free budget in Costa Rica is estimated to have decreased from 18% to 14% of total revenue, four out of ten buyers made the decision to change brands, and two are considering doing the same.
A study presented by Elfinancierocr.com, explains that women are the most affected by the economic situation of the country, since they said that after subtracting all their fixed costs, they only have 12% of their budget.
Understanding the economic environment the company is facing, generating projections in real time and having the opinion of external consultants to the organization, are some of the strategies that could help companies in times of low sales.
In Central America, during the first half of the year, some economies reported declines in their productive activity. The most difficult case is Nicaragua, where economic activity has collapsed 7% in the last year. However, other countries face adverse situations, such as Costa Rica, whose level of economic activity has shown a downward trend over the last year and a half.
At a time of economic slowdown, companies must immediately review business models and identify opportunities arising from the creation of new market niches.
In Central America, during the first half of the year, at least four of the six economies reported declines in productive activity. The most dramatic case is that of Nicaragua, which in February recorded a 7% year-on-year drop in the Monthly Index of Economic Activity (MIEA), a situation reported since the political crisis began in April 2018.
The slowdown in the region's economies and political uncertainty are changing the way consumers in markets such as Guatemala, Costa Rica and Honduras make purchasing decisions.
The White Rabbit group carried out a study on buyer behavior in Guatemala, Honduras and Costa Rica, called "A New Guide to Understanding the Consumer", which analyses the perceptions prevailing in these markets in the region.
"The tightening of global financing conditions is a concern for Central American countries with large current account deficits or those highly dependent on capital flows."
According to the report "World Economic Outlook - January 2019" compiled by the World Bank (WB), countries with a high external debt burden would be at risk if a sudden change in investor confidence in emerging market and developing economies were to occur.
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."
The Central Bank has cut its growth forecast for GDP for the year to 4% - 4.5% and expects inflation to be between 6.55% and 7.5%, higher than initially expected.
From the executive summary of the report "State of the Economy and Prospects, First Semester 2014":
At the end of the first half of the year, the Nicaraguan economy is maintaining positive growth rate, mainly driven by external demand and improved terms of trade. The exporting agricultural sector has been the main driver of economic dynamism in 2014, alongside growth in the manufacturing industry.
Stagnation in private investment has been attributed to a 26.7% reduction in the number of homes completed up to March 2014 compared to the same month last year.
The decrease in investment in the sector seems to be the main reason behind the stagnation showing in construction activities in the country, one of the main drivers of the economy.
Economic growth remains above 4% but it is slowing down and becoming concentrated on a few activities.
The Nicaraguan Foundation for Economic and Social Development (FUNIDES) presented on Tuesday July 16 its second report on economic conditions in 2013, which indicates that economic growth remains above 4 percent, but is slowing down and is concentrated on a few activities. According to the Monthly Economic Activity Index (MIEA) by the Central Bank of Nicaragua (BCN), the economy grew 4.8 percent in the last twelve months and 4.3 percent in the first quarter of 2013.
Economic recovery appears to have come close to a halt in the major industrialised economies, with falling household and business confidence affecting both world trade and employment, according to new analysis from the OECD.
Growth remains strong in most emerging economies, albeit at a more moderate pace.
Economic recovery appears to have come close to a halt in the major industrialised economies, with falling household and business confidence affecting both world trade and employment, according to new analysis from the OECD. Growth remains strong in most emerging economies, albeit at a more moderate pace.
Recognized Brazilian company of backhoe loaders, telescopic, articulated and other types of cranes looking for companies interested in representing the brand and distributing their machinery in Central America and Mexico. The company manufactures and sells telescopic,...
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