Nicaragua Economic Forecast

Nicaragua Economic Outlook

August 7, 2018

Continued unrest and protests against President Daniel Ortega’s government have left hundreds of people dead and are crippling the economy. Output contracted nearly 5% in annual terms in May on huge declines in the construction; commerce; and hotels and restaurants sub-sectors. In addition, exports fell in the same month, while formal-sector employment nosedived in April and May, and international reserves are down sharply since April. This comes after recent figures show year-on-year growth decelerated in Q1 on lower fixed investment and government consumption. Ortega recently raised the possibility of UN mediation in an effort to put an end to the instability, with dialogue between the president and civil society so far proving fruitless.

Nicaragua Economic Growth

Political and social instability will weigh markedly on growth this year, although solid remittance inflows will provide some support. Our panelists expect GDP to expand 0.6% in 2018, down 2.1 percentage points from last month’s forecast, and 3.0% in 2019.

Nicaragua Economy Data

20132014201520162017
Population (million)5.96.06.16.26.2
GDP per capita (USD)1,8471,9752,0732,1442,221
GDP (USD bn)11.011.912.613.213.8
Economic Growth (GDP, annual variation in %)4.94.84.84.74.9
Consumption (annual variation in %)3.84.25.25.33.8
Investment (annual variation in %)3.5-0.424.03.9-1.4
Unemployment Rate5.35.66.06.2-  
Fiscal Balance (% of GDP)-1.1-1.5-1.6-2.0-1.9
Money (annual variation in %)19.613.019.111.513.0
Inflation Rate (CPI, annual variation in %, eop)5.76.53.13.15.7
Inflation Rate (CPI, annual variation in %)7.16.04.03.53.9
Benchmark Interest Rate (%)14.9813.5412.0511.4411.78
Exchange Rate (vs USD)25.3026.6027.9029.3030.80
Exchange Rate (vs USD, aop)24.4725.7226.5928.2629.76
Current Account (% of GDP)-11.9-7.1-9.1-7.5-5.0
Current Account Balance (USD bn)-1.2-0.8-1.1-1.0-0.7
Trade Balance (USD billion)-3.3-3.2-3.5-3.7-3.6
Exports (USD billion)2.42.72.42.22.5
Imports (USD billion)5.75.95.95.96.1
Exports (annual variation in %)-11.111.3-9.3-8.114.4
Imports (annual variation in %)-3.43.10.5-0.33.5
International Reserves (USD)2.02.32.52.42.8
External Debt (% of GDP)88.485.483.683.4-  

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Nicaragua Facts

ValueChangeDate
Exchange Rate31.752.11 %Aug 15

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