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Most difficult time in Costa Rica in nearly 200 years

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PuraVida
  9/17/2020 18:05 EST

The CR government wants to raise taxes in order to receive a $2.25 billion dollar loan. The Costa Rican government on Thursday will announce details about its upcoming negotiations with the International Monetary Fund (IMF). During the expected three-year assistance agreement with the IMF, the Costa Rican government would agree to apply new taxes affecting everyone. The first of the proposed new taxes would be a tax on banking transactions, paid on any type of money transfer. Withdraw cash from an ATM....pay a tax, new property taxes, global income tax, etc.
https://ticotimes.net/2020/09/17/costa-rica-to-propose-fiscal-adjustments-before-negotiations-with-imf

ppbritton
  9/17/2020 19:41 EST

costa rica is TOTALLY bankrupt - It most definitely is going the way of venezuela and zimbabwe - Like I said before, you're going to need a pickup to carry the massive amount of colones you'll need to live on every day!!!

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ILuvCR
  9/17/2020 21:05 EST

dude, ppbritton the sky is not falling!

I know that you thrive on bashing our little country that's obvious but you are just a little over dramatic.

I hope that I've put this in a nice way?

As far as the topic of this thread "Most difficult time in Costa Rica in nearly 200 years" this is the most difficult and challenging time throughout the world in since 1918.

We're all in it together.

un poco menos de pura vida ahora con Covid!

ILuvCR
  9/17/2020 21:11 EST

from: Carlos Alvarado Quesada, President Republic of Costa Rica,
09/17/2020

"The coming months will be decisive for the well-being of the country and difficult measures will be necessary. The coronavirus has hit the world's economy and also Costa Rica's economy. Just as we are facing the health pandemic, we have to respond to the economic pandemic. Therefore, we have been boosting a responsible and gradual economic reopening, but we must be clear, that this will not be enough to deal with the economic and fiscal impact that the country has already suffered.

We have room to avoid a crisis, but we must act quickly. That's why we will enter to negotiate an agreement with the International Monetary Fund. That negotiation will have four essential goals: to maintain economic stability and confidence in the country, to maintain the vital institutions of our Social State of Law, to make the State more efficient to serve the people better, and to protect people at all costs poor and vulnerable as well as middle class.

Not acting would be much worse and would translate into high interest rates, devaluation, more private and public unemployment and poverty, which would affect everyone and particularly gravity the most vulnerable. That's why we have to act and we have to do it quickly: the delay in this would be very expensive.

We live one of the most difficult times that have affected Costa Rica in its 200 years of history, our hope is in our hands and in our own work, Costa Ricans have already shown that we are capable of doing great things when we act united. We won't rest until we see Costa Rica rid of COVID-19 and protected in its economy, employment and the well-being of what we love most: our families. We'll be fine, and we'll get through."

PombinhaCoco7
  9/17/2020 21:35 EST

ILuvCR
Can you please let me know where you found this speech?
I have a link from Tico Times but is a different one.
I want to share this with my neighbors.
Thanks.

PombinhaCoco7
  9/17/2020 23:19 EST

I found the video in Spanish.
Here it is:

https://www.youtube.com/watch?v=Ojn9ZxNOYCk

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ILuvCR
  9/18/2020 09:40 EST

I've "liked" and follow hi Facebook page.

Facebook automatically translates it to English for me, convenient!

If you're interested in what Ticos think and are talking about follow:

"Grupo Coalición Costa Rica", (there is always a translate button under each comment):

https://www.facebook.com/groups/183571579068881/

Trout
  9/18/2020 09:51 EST

If you really want to understand what is going on you also need to read the news & opinions in Spanish.
Costa Rica knocked on the IMF's doors 17 times since 1961, and only 58% of the time the Fund gave CR money, according to a very interesting report by El Financiero. And the last time the IMF loaned CR money was in 1991.

In 1995 it did not do so because the country failed to comply with the plan it agreed to with the Fund.

In 2009, a precautionary loan was negotiated to alleviate the international financial crisis and dispel the uncertainty that rested on the reserves of the Central Bank of Costa Rica, but in the end the loan was not used by decision of the national authorities.
Costa Rica receives less money than it spends, and the tax reform "increases" approved in 2018, although little by little it provided revenues to improve the economy at the beginning of 2020, it is no longer enough. It is common knowledge that if CR was more efficient in tax collection and more vigilant against tax evasion then higher taxes would not be needed.
It bothers me that with the pandemic raging in CR, Prez. Alvarado praised China on Sept. 17th in The Tico Times.
Alvarado spoke about the importance of Costa Rica’s diplomatic relations with China and confirmed he has been invited to China, and that Costa Rica has in turn extended an offer for President Xi Jinping to visit Costa Rica. It's good to be the King.

ppbritton
  9/18/2020 10:07 EST

when I came to costa rica in 2002, I planned on dying there! I am not being over dramatic!! the poloticians have for years been stealing every bit of public funds they could get their hands on!!! now the end has come - trying to tax a country that has NO tax base is an exercise in futility!! - at this time, costa rica needs foreign invexstment!! - no one from outside the country is going to invest in a place that wants to tax (ROB) their capital!! - during the time I lived in costa rica, I saw countless businesses pull the plug on costa rica due to the governments bureacratic, misguided policies - couple of examples 1) used to be a company in Barranca employing over 500 persons - they assembled clothing - moved to south east asia becaause tshey couldn't afford to do business in costa rica 2) Sardimar moved to El Salvad0r 3) the boatyard in Puntarenas was forced to downgrade from over 60 employees to under 20 due to government malfeasance and graft 4) afew ladies that had a business in recycling plastic and trash were run outr of business due to government malfeasance - I repeat - costa rica is FINISHED - the only way to save yourselves is to leave!! the politicians are about to steal everything you have worked a lifetime to get!!!

ppbritton
  9/18/2020 10:56 EST

concerning china - china wants military bases in central america - costa rica has set itself up to become a military power base for china - never mind the governmentrs insistendce that no foreign military interests are allowed in costa rica - china has their meathooks into costa rica - THE COSTARICCENSES BELIEVE THAT THEY are the masters of graft and corruption - nothing could be further from the truth - the chinese have a 3000 year head start on these impudent "know it alls" - they are about to be manipulated by the MASTERS!!!!

figaro
  9/18/2020 12:03 EST

When you have no positive cash flow and go to the bank and ask for a loan, the bank will turn you down.

The CR government has no positive cash flow.

The IMF wants to at least see the positive cash flow to pay off the interest, never mind the principal.

Costa Rican government has to raise taxes substantially and enforce the new tax regime in order to please the IMF. This means more squeeze on everyone, not just gringos, but Ticos as well.

The IMF has other, more lucrative places to invest their money.

This pandemic threw a really hard curveball to Costa Rica. The longer it takes the higher the chances of social unrest, hyperinflation, and the complete collapse of their currency.

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PombinhaCoco7
  9/18/2020 12:16 EST

ILuvCR
I liistened and read the words in Spanish to make sure the translation was good.
Spanish is very similar to Portuguese.
I didn't know this video had come from Casa Presidencial Facebook
So now I will Like it.
Unfortunately there is an economic crisis everywhere.
Some worse than others.

PombinhaCoco7
  9/18/2020 13:55 EST

I know this forum is about Costa Rica but I'm watching the Portuguese News and they are talking about the same situation there.
They are saying that the economy can never recover until Covid-19 is defeated.
This is a global crisis.

Mentor
  9/18/2020 18:12 EST

I do not think that many people understand and they are easy to be critical of Costa Rica. I think that most have no clue what is really happening. Many were so quick to move here but they only complain. The truth is if you are not helping you should not be here. Sorry if its so bad why do you stay here. Yes you are idio--. you are not helping just complaining.
Try making an effort to improve things . Unfortunately most do not see it and yelling fire does not put out the fire morons. So stop complaining or go home.

Mentor
  9/18/2020 18:14 EST

you are not correct and should not post this type of lies. I wish I could talk to you personally to see where you have the fact incorrect.

PombinhaCoco7
  9/19/2020 00:14 EST

oobritton
Wow!-I just noticed your comment where you say that Costa Rica is finished and the only way to save ourselves is to leave.
To go where?
To the United States?
Do you know how many Americans have given up their citizenship?
If The United States is doing so well why are people trying to go elsewhere?
I don't know about your faith and your religious believes but there was only One who spoke those words in truth over 2.000 years ago when He said: IT IS FINISHED!
I'm glad that He is the One still in charge and forever will be!
To Jesus be all the honor, praise and glory!
He will never forsake us.
It is our choice to accept Him or to reject Him.
Yes, He himself spoke of hard times but He also told us not to worry about Tomorrow.
Let's pray for Costa Rica and for our President instead of speaking negativity and doom and gloom.
You are so busy bashing Costa Rica that you are not focusing in what is happening in your own yard.

USAinvestJaco
  9/20/2020 06:13 EST

Additional taxes on money flow, atm, and global and real estate all correspond to less foreign investment and likely create more havoc on economy in the long term. This pandemic isn't over! What happens if it continues and what does the CR gov't do? This is very imprudent decision. It says it is 3 year loan but these additional taxes won't go away. Costa Rica locked down for long time with very good Covid numbers but numbers increased and now there is tourism again. I question why the lockdown in 1st place and that caused this economic crisis. It does appear that CR prefers the socialist vs capitalist system and Chinese ways will be the downfall. Nothing is free. Just interest rates alone stymie growth and make difficult for Costa Ricans to create their own wealth and make the low cost of healthcare an added cost and not a benefit. It costs more for the very high unjustified interest rates vs the added benefit of low health Care costs. Unless the people speak at the ballot box and elect politicians that grow the economy from within so investor's flock to the beautiful country and people in Costa Rica can attain home ownership more easily and not depend on the government there will be very difficult road ahead. This is band aid solution on a bullet wound. I don't understand why this is Costa Rica forum but some continue to compare it to other countries. Every country has problems and hopefully there are solutions. Maybe we focus on the solutions more.

WeOld
  9/20/2020 08:46 EST

Learn some Spanish BEFORE moving to a Spanish speaking country as an Expat. The proposed tax increases were announced last Thursday and the "first" protest march by Ticos is today, Sunday 20th, in San Jose. If you own property in CR, they want to triple your property taxes. IMF conditionality is a set of policies or conditions that the IMF requires in exchange for financial resources. The IMF does require collateral from countries for loans but also requires the government seeking assistance to correct its macroeconomic imbalances in the form of policy reform. If the conditions are not met, the funds are withheld. The maximum sustainable debt level of a polity, which is watched closely by the IMF, was defined in 2011 by IMF economists to be 120% and Costa Rica's rate is currently 70% however, a rapid increase in interest payments continues to widen the overall fiscal deficit likely leading to political and social protests. https://www.fitchratings.com/research/sovereigns/correction-fitch-downgrades-costa-rica-to-b-outlook-negative-12-05-2020

PuraVida
  9/20/2020 12:40 EST

NO MAS IMPUESTOS! video of protests today. Read the comments.....
https://www.facebook.com/YaNoMasRecope/videos/330685405018527/?sfnsn=mo&extid=EopBVoOXrVc1FZoY

1952cajun
  9/20/2020 12:48 EST

You bring up vital information, thank you. But if I would have listened to your advice about learning the language of the country before moving, I would still be in the US. I would much rather struggle along in Costa Rica than being stuck in the US. She not all your advice applies to everyone. Pura vida

PuraVida
  9/21/2020 12:18 EST

https://ticotimes.net/2020/09/21/president-of-legislative-assembly-doesnt-see-viability-of-costa-ricas-imf-proposal

Cruickshank, of the evangelical National Restoration Party, said the government should prioritize battling tax evasion, which he says represents $3.8 billion annually.

At the same time, Cruickshank said, the government should tax sectors that are currently “not paying a single colón” in duties. This includes Costa Rica’s tax-free zone areas

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