Economic activity continues to grow at a relatively high rate but lower than in 2010-11. FUNIDES in its baseline scenario projects that the economy will grow by 3.6% this year and 4% on average in 2013-2014.
However, these projections assume that the external environment, particularly in the Eurozone, will gradually improve. Conversely, if the external environment deteriorates in the coming months, the 2013-14 growth could fall to 2%. Internal risks, linked to the upcoming election and fiscal reform, could also result in less growth than that in the baseline scenario.
The tax reform proposal presented by the Government last month is still too general to evaluate. For now FUNIDES recommends that the country’s tax burden should not be raised further and even less that of current taxpayers. What is required is to broaden the tax base and continue moving towards a simpler, more efficient, and equitable tax system.
The report highlights that the economic slowdown that had been observed in the year seems to have stopped in September and that the pace of overall economic activity exceeds that of other countries in the region.
From a statement issued by the Nicaraguan Foundation for Economic and Social Development (FUNIDES):
The report notes that although private consumption remains the main engine, the pace of growth in economic activity continues to slow.
Economic Situation Report of the third quarter of the year, prepared by the Nicaraguan Foundation for Economic Development:
The Nicaraguan Foundation for Economic and Social Development (FUNIDES) presents its third report on economic conditions in 2014, which states that in the first 7 months of 2014, the economy has continued a slowdown which began in the fourth quarter 2013. The average variation of 12 months of the Monthly Index of Economic Activity (MIEA), original series, which had reached 4.8% in April stood at 4.2% in July.
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