Nicaragua, the second most globalized country in Latin America

The Latin Business Chronicle recently published the Latin Globalization Index 2010, in which Nicaragua improved its position from third to second place.

The Latin Business Chronicle recently published the Latin Globalization Index 2010, in which Nicaragua improved its position from third to second place.

This index of 18 countries examines six factors that measure a country's link with the outside world. The factors include exports of goods and services as a percent of GDP, imports of goods and services as a percent of GDP, foreign direct investment (FDI) as a percent of GDP, tourism receipts as a percent of GDP, remittances as a percent of GDP and internet penetration.

The index uses data for the most recent full year, which in this case is 2009, from The World Bank, the United Nations Economic Commission for Latin America and the Caribbean, the International Monetary Fund (IMF), the International Telecommunications Union and the Santiago Chamber of Commerce.

According to the Inter-American Development Bank (IDB), Nicaragua will close 2010 with a 30 percent increase in export’s value when compared to 2009, reaching US$1.86 billion; volume is also expected to grow by 14 percent by the end of 2010.

Additionally, the Latin Business Chronicle has positioned Nicaragua as the third country that most attracts FDI in Latin America when compared to its GDP in 2008 and 2009. By the end of 2010, the country expects to attract around US$500 million in FDI, a 15 percent increase when compared to 2009, mainly as a result of large-scale investment projects in the renewable energy sector.

Furthermore, the Nicaraguan Tourism Board (INTUR, for its acronym in Spanish) reports that over one million tourists will visit Nicaragua by the end of 2010, which will represent above US$400 million in tourism receipts, establishing records in both categories.

Mr. Murilo Portugal, Deputy Managing Director and Acting Board Chair of the IMF, said “the Nicaraguan economy is recovering gradually from the effects of the global financial crisis. The pickup in activity in 2010 has been broad based and balanced, exports are growing faster than anticipated, and the financial system remains stable and liquid. Real GDP growth is expected to reach 3 percent this year and the balance-of-payments position has improved. The authorities strengthened their economic program for the remainder of this year and for 2011 to mitigate risks, protect the external position, and pave the way for further fiscal consolidation.”