Steady Broad-Based Growth to Continue in Costa Rica in 2025

• Costa Rica's GDP is expected to grow 4.1% in 2024 and 3.6% in 2025, according to Fitch Solutions, up from earlier projections of 4.0% and 3.4% respectively. The upward revision in the forecast for GDP is in line with a slightly improved outlook for US economic growth by the agency.
• The improved outlook is also informed by recent data indicating that economic activity continued to hold up well during Q3 2024, with growth estimated at around 4.0% compared to an average of 4.3% over the first half of the year
• Private consumption will be the main contributor to growth, amid low inflation and a tighter labour market, while easing monetary conditions will sustain robust investment growth.
• Additionally, export growth will remain positive, but slow due to softer demand in the US and less favourable base effects for the tourism sector.
• Risks to the forecasts are mostly connected to dynamics in the US economy, with the potential for more protectionist and anti-immigration policies under Trump a key headwind for Costa Rica and the wider Central American region.

 (Source: Fitch Solutions)