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The Economy of Nicaragua

Nicaraguan Economy

Nicaragua's map

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 that should create some fiscal space for social spending and investment. The continuity of a relationship with the IMF helps support donor confidence, despite private sector concerns surrounding ORTEGA, which has dampened investment. Economic growth will slow 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 account for almost 15% of GDP.

GDP:

GDP - real growth rate: 2% (2008 est.) 3.8% (2007 est.) 3.9% (2006 est.)

GDP - per capita:

GDP - composition by sector: agriculture: 17% industry: 26.1% services: 56.9% (2008 est.)

Population below poverty line:

Household income or consumption by percentage share: lowest 10%: 2.2% highest 10%: 33.8% (2001)

Distribution of family income - Gini index: 43.1 (2001)

Inflation rate (consumer prices):

Labor force: 2.322 million (2008 est.)

Labor force - by occupation: agriculture: 29% industry: 19% services: 52% (2006 est.)

Unemployment rate: 3.9% plus underemployment of 46.5% (2008 est.)

Budget: revenues: $1.271 billion expenditures: $1.593 billion (2008 est.)

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:

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 - exports: 808.5 bbl/day (2005)

Oil - imports: 29,700 bbl/day (2005 est.)

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.)

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

Exports: $3.183 billion f.o.b.; note - includes free trade zones (2008 est.)

Exports - commodities: coffee, beef, shrimp and lobster, tobacco, sugar, gold, peanuts

Exports - partners: US 31.7%, El Salvador 14%, Honduras 9.3%, Costa Rica 7.2%, Canada 5.8%, Guatemala 5.5%, Mexico 4.8% (2007)

Imports: $5.279 billion f.o.b. (2008 est.)

Imports - commodities: consumer goods, machinery and equipment, raw materials, petroleum products

Imports - partners: US 22.5%, Mexico 13.5%, Costa Rica 8.4%, Venezuela 6.4%, Guatemala 6.2%, El Salvador 4.8% (2007)

Debt - external: $3.214 billion (31 December 2008 est.)

Economic aid - recipient:

Currency:

Currency code:

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: