Nicaragua Economy Profile 2009

Economy - overview

Nicaragua has widespread underemployment and the second lowest per capita income in the Western Hemisphere. The US-Central America Free Trade Agreement (CAFTA) has been in effect since April 2006 and has expanded export opportunities for many agricultural and manufactured goods. Textiles and apparel account for nearly 60% of Nicaragua's exports, but recent increases in the minimum wage will likely erode its comparative advantage in this industry. Nicaragua relies on international economic assistance to meet internal- and external-debt financing obligations. In early 2004, Nicaragua secured some $4.5 billion in foreign debt reduction under the Heavily Indebted Poor Countries (HIPC) initiative, and in October 2007, the IMF approved a new poverty reduction and growth facility (PRGF) program. However, severe budget shortfalls resulting from the suspension of large amounts of direct budget support from foreign donors concerned with recent political developments has caused a slowdown in PRGF disbursements. Similarly, private sector concerns surrounding ORTEGA's handling of economic issues have dampened investment. Economic growth has slowed in 2009, due to decreased export demand from the US and Central American markets, lower commodity prices for key agricultural exports, and low remittance growth - remittances are equivalent to almost 15% of GDP.

GDP (purchasing power parity)

$16.79 billion (2008 est.)
$16.27 billion (2007 est.)
$15.76 billion (2006 est.)
note: data are in 2008 US dollars

GDP (official exchange rate)

$6.35 billion (2008 est.)

GDP - real growth rate

3.2% (2008 est.)
3.2% (2007 est.)
3.9% (2006 est.)

GDP - per capita (PPP)

$2,900 (2008 est.)
$2,900 (2007 est.)
$2,800 (2006 est.)
note: data are in 2008 US dollars

GDP - composition by sector

agriculture: 16.9%
industry: 25.8%
services: 57.3% (2008 est.)

Population below poverty line

48% (2005)

Labor force

2.322 million (2008 est.)

Labor force - by occupation

agriculture: 29%
industry: 19%
services: 52% (2006 est.)

Unemployment rate

5.6% (2008 est.)
4.9% (2007 est.)
note: underemployment was 46.5% in 2008

Household income or consumption by percentage share

lowest 10%: 1.4%
highest 10%: 41.8% (2005)

Distribution of family income - Gini index

43.1 (2001)
60.3 (1998)

Investment (gross fixed)

34.5% of GDP (2008 est.)

Budget

revenues: $1.271 billion
expenditures: $1.594 billion (2008 est.)

Public debt

53.2% of GDP (2008 est.)
69.5% of GDP (2004 est.)

Inflation rate (consumer prices)

19.8% (2008 est.)
11.1% (2007 est.)

Central bank discount rate

NA%

Commercial bank prime lending rate

11% (31 December 2008)
13.04% (31 December 2007)

Stock of money

$NA (31 December 2008)
$465.1 million (31 December 2007)

Stock of quasi money

$NA (31 December 2008)
$1.802 billion (31 December 2007)

Stock of domestic credit

$NA (31 December 2008)
$4.133 billion (31 December 2007)

Industries

food processing, chemicals, machinery and metal products, textiles, clothing, petroleum refining and distribution, beverages, footwear, wood

Industrial production growth rate

3% (2008 est.)

Electricity - production

3.012 billion kWh (2006 est.)

Electricity - production by source

fossil fuel: 83.9%
hydro: 7.7%
nuclear: 0%
other: 8.4% (2001)

Electricity - consumption

2.413 billion kWh (2006 est.)

Electricity - exports

0 kWh (2007 est.)

Electricity - imports

63.95 million kWh (2007 est.)

Oil - production

0 bbl/day (2005 est.)

Oil - consumption

28,880 bbl/day (2006 est.)

Oil - imports

29,700 bbl/day (2005 est.)

Oil - exports

808.5 bbl/day (2005)

Oil - proved reserves

0 bbl (1 January 2006 est.)

Natural gas - production

0 cu m (2007 est.)

Natural gas - consumption

0 cu m (2007 est.)

Natural gas - exports

0 cu m (2007 est.)

Natural gas - imports

0 cu m (2007 est.)

Natural gas - proved reserves

0 cu m (1 January 2006 est.)

Current Account Balance

-$1.418 billion (2008 est.)
-$1.048 billion (2007 est.)

Agriculture - products

coffee, bananas, sugarcane, cotton, rice, corn, tobacco, sesame, soya, beans; beef, veal, pork, poultry, dairy products; shrimp, lobsters

Exports

$2.922 billion (2008 est.)
$2.313 billion (2007 est.)

Exports - commodities

coffee, beef, shrimp and lobster, tobacco, sugar, gold, peanuts

Exports - partners

US 60.6%, El Salvador 7.2%, Honduras 4.8% (2008)

Imports

$5.042 billion (2008 est.)
$4.117 billion (2007 est.)

Imports - commodities

consumer goods, machinery and equipment, raw materials, petroleum products

Imports - partners

US 25.1%, Mexico 11.6%, Costa Rica 7.3%, Venezuela 6.4%, Guatemala 5.3%, China 4.3%, El Salvador 4.1% (2008)

Reserves of foreign exchange and gold

$1.141 billion (31 December 2008 est.)
$1.103 billion (31 December 2007 est.)

Debt - external

$3.276 billion (31 December 2008 est.)
$3.341 billion (31 December 2007 est.)

Market value of publicly traded shares

$NA

Economic aid - recipient

$471 million (2006 est.)

Currency (code)

gold cordoba (NIO)

Currency (code)

NIO

Exchange rates

cordobas (NIO) per US dollar - 19.374 (2008 est.), 18.457 (2007), 17.582 (2006), 16.733 (2005), 15.937 (2004)

Fiscal year

calendar year