QCOSTARICA – Overnight and thanks to the legal insecurity in Nicaragua unleashed by the government of President Daniel Ortega, Costa Rica became the number 1 option for the transfer of operations of Nicaraguan companies and other investments to our country.
More investment and a greater number of jobs would be the positive consequences for the national economy, after the closure of 19 business chambers in Nicaragua.
On the other hand, greater poverty and unemployment in the neighboring country would translate into a disorderly migratory flow, which would also imply greater pressure on State institutions.
Read more: Exporters affirm that Daniel Ortega’s decisions will only increase poverty
The legal insecurity caused by Ortega in his country could be translated on national soil into more service, manufacturing, finance, agricultural and tourism companies.
“There are many companies that could be coming to Costa Rica in the manufacturing, financial and call center services that would find highly qualified human talent, but you have to be vigilant about the issue of labor substitution that could occur in the medium term, which would be located as it has been doing, in the construction and agricultural sectors,” said Daniel Suchar, financial analyst, told La Republica.
The result of the latest attack by the Nicaraguan government on the business sector will be a drop in their profits due to legal uncertainty.
“Without a doubt, all this political uncertainty will cause investors and businessmen to start the evaluation of the transfer of its operations outside of Nicaragua to Costa Rica, due to its proximity, political and commercial stability, which makes us the number 1 option,” said Katherine Chaves, Executive Director of the Chamber of Foreign Trade (Crecex).
The effects for the Costa Rican companies that export there would also occur in the short term since it is possible that by closing these groups, many contracts would disappear.
“Foreign trade will deteriorate because consumption opportunities go beyond borders, but the good news is that the country could attract investment in the tourism, agricultural and industrial fields,” said Gerardo Corrales, economist at Economía Hoy.
The situation called for leaders of the Costa Rican private sector to show solidarity with their counterparts.
“We reiterate our rejection of the measures taken by the government of Daniel Ortega and we ask that respect the rule of law, democracy, freedom, which are universal values”, assured Enrique Egloff, president of the Chamber of Industries.
“It would be premature to advance a criterion regarding the possible scenarios that may arise after Daniel Ortega’s decision and the closure of COSEP and the 18 business chambers.
We reiterate the call for social dialogue to avoid a greater impact, not only economic, but also social and democratic in Nicaragua, what is true is that these types of decisions undermine legal security for investment,” commented Jorge Luis Araya, Executive Director
Union of Chambers.
Ruben Aco, President, the National Chamber of Tourism, stated that: “It is a hard blow to the business sector that violates the freedom of association and that is why we stand in solidarity with our Nicaraguan counterpart, as well as all the organizations that have been affected by this unfair and abusive act.
“Political and social instability in any country in the world generates migratory effects.
What is happening in Nicaragua is a truly unfortunate situation that harms the right to free enterprise, on the other hand it can generate not only speculation but also uncertainty both inside and outside the country. We cannot affirm at this moment the real effect or the repercussions of what happened in Nicaragua, but we are constantly monitoring it,” said Sianny Villalobos, Executive President of Chamber of Exporters.