As the Costa Rican economy tries to stay afloat – or at least not go too far under – economists and institutions are placing their stakes, all offering different predictions as to when it will resurface for air.
Adding to the differing reports over the past week was the release Thursday of the Consumer Confidence Survey published by the University of Costa Rica (UCR). Conducted during the first three weeks of May, the survey found people to be pessimistic, though they maintain high expectations for the future.
The survey tracked a massive drop between February and August 2008, when confidence fell over 20 points on a scale that usually fluctuates no more than 10 points within a year.
But since then “it’s been getting better,” said Johnny Madrigal, a professor of statistics at the university. “It’s not what we want to see, but it’s been getting better.”
Since the low in August 2008, the survey documented a nearly six-point increase in confidence. The silver lining is that Costa Ricans believe the recession is merely a momentary lull to be followed by a strong rebound. The survey found a drastic break of 15 points between how people feel about the current situation and their expectations for the future.
Exactly a week before the release of the UCR survey, the Central Bank changed positions on how the economy would unfold throughout 2009. In January, the bank predicted the economy would grow 2.2 percent in 2009, despite signs of rapid contractions across a number of sectors. It maintained that upbeat diagnosis until last week, when it predicted the economy would contract 1.8 percent.
The shift drew criticism, with some claiming the bank was withholding accurate information from the public.
“They waited far too long to release the information,” said Carlos Carranza, a sociologist and political scientist with the NationalUniversity. “It’s the function of the Central Bank to give realistic data to the country quickly so that it can take the necessary actions.”
The prediction may still be optimistic, however, as the World Bank predicted the economy would shrink over 3 percent in 2009 and not experience growth until 2011 – a dire outlook, considering the IMF and Central Bank both predicted a recovery in 2010.
– Daniel Shea