Costa Rica: Post Financing Assessment-Press Release; and Staff Report
IMF Staff Country Reports, December 23, 2024
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- Costa Rica: Post Financing Assessment-Press Release; and Staff Report
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- Published: December 23, 2024
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9798400295485.002
Economic outlook and recent performance
- Growth has exceeded 4 percent so far in 2024.
- Growth is expected to moderate to 3 1/2 percent in 2025.
- Costa Rica successfully completed its Extended Fund Facility and Resilience and Sustainability arrangements in June.
- Growth remains robust, inflation continues to converge to the central bank’s target from below, and international reserves are ample.
Fiscal policy and consolidation
- Fiscal consolidation should be anchored on reducing spending in nonpriority areas and bolstering revenues while allowing for some increase in social spending.
- The fiscal stance should be centered on adhering to the fiscal rule and medium-term fiscal framework.
Financial sector stability and safety nets
- The recent intervention and resolution of two small, nonbank financial institutions underscores the importance of the authorities’ plans to strengthen the frameworks for bank resolution and deposit insurance.
Resilience, institutions, and supply-side reforms
- Discussions centered on further enhancing economic and climate resilience, capitalizing on Costa Rica’s economic fundamentals and institutions, and sustaining the policy track record demonstrated over the past several years.
- Progress in a range of supply side areas will be important to raise potential growth and mitigate the effects of climate change.
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