Does Costa Rica deserve its positive reputation?
For some time, Costa Rica Costa Rica (kŏs`tə rē`kə), officially Republic of Costa Rica, republic (2005 est. pop. 4,016,000), 19,575 sq mi (50,700 sq km), Central America. has had a reputation of being one of the most stable countries in the Latin American region. And the graph above-showing the rate of growth of per capita [Latin, By the heads or polls.] A term used in the Descent and Distribution of the estate of one who dies without a will. It means to share and share alike according to the number of individuals. income-displays a trend line portraying a steady increase.
But it also highlights a contrasting volatility, the very opposite of stability. And, most alarming of all, the graph indicates an expected decline in the rate of growth for both 2007 and 2008.
There are reasons for the expected decline, of course. The United States, a major trading partner, is experiencing a slowdown, as is the rest of the global economy. Costa Rica, heavily dependent on tourist dollars, suffers at a disproportionate rate.
Economists call this part of the situation a vulnerability to "external shocks." This, too, is not in keeping with Costa Rica's international reputation as a stable economy.
Without wanting to take away from the genuine progress the government of Costa Rica has made in managing the government itself as a financially responsible entity-in spite of recent serious allegations of corruption with accusatory headlines such as "Paradise Lost," and "Fall from Grace"-one can say that Costa Rica may not be quite the island of stability in the region its public relations public relations, activities and policies used to create public interest in a person, idea, product, institution, or business establishment. By its nature, public relations is devoted to serving particular interests by presenting them to the public in the most people like to portray.
Consider the following April 30, 2007 headline posted on the website of news aggregator Inside Costa Rica: "Electrical Power Rationing Resumes Today."
The website says, "Following more [than] almost two days of no power rationing, the Instituto Costarricense de Electricidad Instituto Costarricense de Electricidad ICE is the national electricity monopoly in Costa Rica being the largest company in the country. Group of companies
Sector Electricidad - ICE
Is the electricity branch of Instituto Costarricense de Electricidad ICE (ICE) will resume its rationing of electrical power throughout the country as the country faces an energy crisis."
ICE says the energy shortage is due to a drought, which has slowed the production of hydroelectric energy. An electric energy shortage has the potential to undermine productivity and stunt growth.
The point is that a truly stable economy would not be vulnerable to either economic nor environmental shocks. The country's infrastructure should cope with most anything. There would be enough redundancy built into its systems to mitigate such shocks. And certainly there would be nothing like the volatility in per capita income Noun 1. per capita income - the total national income divided by the number of people in the nation
income - the financial gain (earned or unearned) accruing over a given period of time shown in the graph on page 1.
In it's February 2007 review of the Costa Rican economy, the Inter-American Development Bank Inter-American Development Bank (IDB)
international organization founded in 1959 by 20 governments in North and South America to finance economic and social development in the Western Hemisphere. (IADB IADB
Inter-American Defense Board ) acknowledges Costa Rica's recent progress. "The country has a long track record of political stability and institutional quality, a firmly established outward-looking growth model, and a social structure that includes a large middle class and low levels of exclusion relative to other countries in the region."
Notwithstanding these high marks, the IADB says Costa Rica's, "pace of growth has shown signs of slowing in recent years and its economic growth has been somewhat volatile."
The International Monetary Fund (IMF IMF
See: International Monetary Fund
See International Monetary Fund (IMF). ) also reviewed Costa Rica's economy in February 2007. The IMF, too, praised Costa Rica's progress, but called for tax reform and increased social and capital spending capital spending
Spending for long-term assets such as factories, equipment, machinery, and buildings that permits the production of more goods and services in future years. .
Since offshore banking is a growing and important economic contributor, the IMF said, as well, that this sector needed enhanced supervision presumably pre·sum·a·ble
That can be presumed or taken for granted; reasonable as a supposition: presumable causes of the disaster. as a way of assuring investor confidence.
Finally, the IADB wants Costa Rica to improve its global competitiveness.