New government of Costa Rica presents measures to bring down spending

On 30 May, Minister of Finance Rocio Aguilar presented to Congress a range of measures designed to reduce the deficit, including tax reforms, a freeze on public sector salaries, the renegotiation of rents paid for government buildings, and a reduction in spending and headcount across several government departments. According to Aguilar, “this group of measures, plus the Law for Strengthening Public Finances and a new Public Employment Law that will govern in 2020 for new officials, can reduce the deficit by 3 percentage points of GDP”. The measures presented by Aguilar reflect the outcome of a period of  consultation led by President Carlos Alvarado with opposition parties in Congress whose support he needs to ensure the passage of the measures. Responding to the measures presented, the Secretary General of the Organization for Economic Cooperation and Development (OECD), Ángel Gurría, expressed his support in a statement published on the OECD website on 4 June.

This is an extract from the Caribbean Council’s fortnightly editorially independent publication, Central America Briefing, which provides in depth information on current economic, political and commercial developments in Central America. Business people, academics, and those with a general interest in Central America find it an invaluable tool for developing and maintaining knowledge and providing an insight into political, economic and commercial events in the region.

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