IMF Staff Concludes Visit to Costa Rica

IMF News, June 17, 2022

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IMF team led by Manuela Goretti visited San José, Costa Rica, on June 14-16, 2022, to meet with the new government and discuss their policy priorities under the economic reform program supported by the Extended Fund Facility (EFF).
The mission was in preparation for the third review mission under the EFF later in the year.
Press Release No. 22/207; publication date: June 17, 2022.

The team discussed recent economic developments and the outlook amid heightened external pressures and the ongoing pandemic.
Higher global commodity prices are weighing on the current account and international reserves through a rising oil import bill.
Sustained capital outflows from local pension funds are contributing to external pressures.
External pressures are feeding through to inflation, which is increasing rapidly beyond the Central Bank of Costa Rica´s (BCCR) tolerance band.
After a strong rebound in 2021, with real GDP growth reaching 7.8 percent, high frequency indicators point to a softening in economic activity in 2022.

The authorities renewed their firm commitment to ensuring debt sustainability.
They committed to safeguarding monetary and financial stability and protecting the most vulnerable amid rising global and domestic pressures.
Ongoing efforts to strengthen policies to boost productivity and foster green and inclusive growth were emphasized.
The authorities expressed interest in the IMF’s new Resilience and Sustainability Facility to advance Costa Rica’s efforts to adapt to climate change and transition to a low-carbon economy, while generating new jobs and growth opportunities.

The IMF staff will continue to work with the authorities to support Costa Rica’s efforts to strengthen policies to boost productivity and foster green and inclusive growth.
The IMF team thanked the authorities for their hospitality and fruitful discussions and stands ready to continue to support the government of Costa Rica in the implementation of its ambitious economic reform program.

Source: Press Release No. 22/207, June 17, 2022.