After a three year period in the red, FUNIDES (the Nicaraguan Foundation for Economic and Social Development) is forecasting Nicaragua’s GDP to grow by 3.7 percent in 2021. This would be the first year of growth since 2017 which was the last year of an eight year run which saw GDP grow annually between 4.4% and 6.5%. This according to a report entitled “Informe de Coyuntura” (Situation Report), released last Saturday 29th May 2021 by FUNIDES.
The Nicaraguan Foundation for Economic and Social Development – “FUNIDES”, is an NGO and independent institution that specializes in research and policy analysis in the areas of socio-economic development and institutional reform. Their objectives are to;
- Improve the quality of public policy analysis and the transparency in the execution of these policies.
- Promote policies that support the socioeconomic and sustainable progress of Nicaragua.
- Provide information to producers and entrepreneurs, decision makers of the public sector and of society as a whole, among others, on the economic and social perspectives of the country.
- Encourage civic participation and debate about national policies.
Per Capita, the GDP would be US $2,027 dollars, which would represent an increase of 6.0% compared to 2020, by the same projection.
GDP decreased 2.0 percent in 2020. This was attributed to the Covid-19 pandemic as well as losses and damage caused by the two hurricanes; “Eta” and “Iota” that hit the north east of Nicaragua 10 days apart last November. (Source BCN – Central Bank).
The three year period of negative growth for Nicaragua’s GDP started in 2018 with sociopolitical crisis. The number fell by 3.4 percent in 2018 and 3.7 percent in 2019. In 2020 the recovery started and despite the Covid-19 pandemic, 2020 was only negative 2% and now FUNIDEs forecasts Nicaragua’s GDP to Grow 3.7% in 2021.
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Poverty Rate – The NGO states that after the increase in income has been applied, the poverty rate will be 24.6% of the population, which is 1.6 million people, based on the usually published total population of 6.5 million Nicaraguans. FUNIDES estimate that those 1.6 million people will be living on an average of US $ 1.77 per day.
In the report, FUNIDES clarified that the projections assume a status quo for the rest of the year as far as any additional public policies with a macroeconomic impact (e.g. tax reform or a social security reform) and also no negative change in the Covid-19 Pandemic, or the socio-political environment.
Source: FUNIDES Press Release
