Costa Rica Headed For More Political Stability In 2019

• It is expected that the Alvarado administration will focus on environmental and social policy in the coming quarters.

 

• In recent months, Costa Rican security forces have helped reverse the rise in violent crime in recent years, as total homicides reached an all-time high of 603 in 2017.

 

• Combined with the reduction in crime, modest inflation led to a revision of Costa Rica’s Short-Term Political Risk Index (STPRI) score. It is forecasted that price inflation will remain low and stable in the coming quarters, averaging 2.7% YoY in 2019.

 

• However, a sustained increase in unemployment and the resumption of violence in Nicaragua are two key risks to social stability. Unemployment reached 12.0% at end-2018, a multi-year high.

 

(Source: Fitch Connect)