Unchecked Spread of COVID-19, Political Instability Loom As Risks To Growth In Nicaragua

  • COVID-19 continues to spread virtually unchecked throughout Nicaragua, posing downside risks to its real GDP growth forecasts for 2020 and 2021.
  • While Fitch Solutions maintains its 2020 and 2021 real GDP growth forecasts at -6.3% y-o-y and 1.0%, the absence of public health lockdowns or major fiscal support suggests that the economic recovery will be slow in the coming years.
  • In addition, fading external attention to Nicaragua suggests that President Daniel Ortega‚Äôs government will not offer electoral concessions ahead of the November 2021 general election, increasing the risk of economically disruptive social unrest.

(Source: Fitch Solutions)