In the second quarter of the year, Costa Rica's GDP grew 1.4% year-on-year, below the 3% reported for the same period in 2018, which is associated with the evolution of internal demand and external demand for the production of companies under the definitive regime.
In the second quarter of 2019, the country's economic activity, as measured by the trend of the Gross Domestic Product (GDP) cycle, grew 1.4%, continuing the loss of dynamism observed since the second quarter of 2018, reported the Central Bank of Costa Rica (BCCR).
For the 2017-2018 season, imported coffee consumed in the country represented 18% of demand, but for the 2018-2019 cycle that proportion increased to 45%, being Nicaragua and Honduras the main suppliers of the grain.
According to statistics from the General Directorate of Customs and compiled by the Coffee Institute of Costa Rica (Icafe), for the 2018-2019 cycle in the Costa Rican market were consumed about 526 thousand bags of 46 kilos of coffee, of which 292 thousand were of national production and 234 thousand were purchased abroad.
Between 2017 and 2018, honey production increased by 5%, and according to businessmen there are opportunities for the sector to continue on the right path, because in the Costa Rican market there is still demand that can not be met with local production.
The Agricultural Statistical Bulletin, prepared by the Executive Secretariat of Agricultural Sector Planning, states that between 2017 and 2018 production grew from 1,128 to 1,180 metric tons.
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For the Central Bank of Costa Rica, the projection of growth in production, which for this year is 3.2%, should be reviewed downward, because of the evolution that has shown the economic activity during the first half.
Considering the shocks that have affected national production so far in 2019, it is likely that this year economic growth will be below the 3.2% projected in the 2019-2020 Macroeconomic Program last January, explains the most recent report of the Central Bank of Costa Rica (BCCR).
High operating costs and the contraction of internal consumption are some of the reasons why in Costa Rica manufacturing companies under definitive regime report a decrease in their production, a situation that contrasts with the dynamism of companies in free trade zones.
The latest report on economic activity in the country, compiled by the Central Bank of Costa Rica explains that manufacturing grew 2.3% mainly because the free zone companies maintained a high growth (10.8%), which more than compensated for the decrease in production of the definitive regime (-2.5%).
Partly explained by the exhaustion of soils dedicated to the cultivation of grain, in Costa Rica the 2018-2019 harvest was 1.7 million bags, one of the lowest records of recent decades.
Data from the Coffee Institute of Costa Rica (Icafé) specify that between the 2017-2018 season and 2018-2019, production in the country decreased by 276,970 bags of 46 kilograms, falling from 1,991,755 to 1,714,785 bags.
In the first quarter of the year, the country's Gross Domestic Product increased 1.8% year-on-year, lower than the 3.3% reported in the same period in 2018, which is partly explained by the fall in the prices of some agricultural export products.
According to the report of the Central Bank of Costa Rica, the slowdown combined external and internal factors, among which stand out:
Guatemala and El Salvador are the Central American economies that have registered the lowest levels of economic growth, when this is associated with the size of their public sector.
Panama, Nicaragua, Honduras and Costa Rica are the countries that would be obtaining exceptional results in their economic growth from the average expenditure of the region during 2011 to 2018, which could be associated with the investment made in past periods, informed the Central American Institute of Fiscal Studies (Icefi).
The sustained rise in imports of dairy products, coupled with drought in different parts of the country, explains the reduction of more than 50% reported in milk production in the Dominican Republic.
Directors of the Dominican Association of Milk Producers (Aproleche), estimate that between 2012 and 2018, the purchase of liquid milk abroad went from 900 thousand liters to 40 million liters.
The fall in international grain prices in recent years has increasingly affected producers in the region, who at current prices do not even reach the production costs.
Since years ago, international sugar prices have reported a clear downward trend, and in the last twelve months the quintal price registered a fall of 23%.
In the first days of January last year, the international price of sugar was above $15 per quintal, and that value has been decreasing in recent months, falling to $12 per quintal at the beginning of this year, according to Investing.com.
In Costa Rica, the Treintaycinco company reported that, on December 10th, a new beer Lager began to be sold in the local market.
The company, which has been participating in the Costa Rican market for artisanal beers for five years, announced that it plans to compete in the local market for premium beers.
In Costa Rica, the coffee sector expects that for the 2018-2019 harvest will be produced about 1.8 million quintals, a volume that would be 11% lower than that recorded in the 2017-2018 season.
According to forecasts by the Costa Rican Coffee Institute (Icafé), between the 2017-2018 and 2018-2019 harvests, the country's production will fall from 2 million to 1.8 million quintals, a decline that would be caused by the cyclical behavior of plants and the aging of coffee plantations.
As a result of an increase in investment in new constructions and in the final consumption of households, GDP increased 3.3% year-on-year in the second quarter of the year.
During the second quarter of 2018, the economic activity volume, measured with the trend of the Gross Domestic Product (GDP) cycle, increased at an annualized rate of 3.6%, mainly as a result of an increase in investment in new buildings and final consumption of households.
The rainfall deficit reported between the end of June and August, together with a summer that could be combined with El Niño starting from this November, raises the probability of drought in the sector.
According to data from the National Meteorological Institute (IMN), between January and August of this year in Liberia, province of Guanacaste, the rainfall deficit was 40% compared to the historical average.
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