LatinNews Daily - 02 September 2025

*Costa Rica’s government led by President Rodrigo Chaves has unveiled its proposed 2026 budget which is for ₡12.80tn (US$25.31bn), up 3.1% on the 2025 budget and equivalent to 23.4% of GDP. The government said that ₡7.92tn would come from current income. Of the total spending 42.1% would go on servicing public debt. This is followed by education which would receive 21.5% of the total, pensions (10.3%), the judiciary (4.2%), and the ministries of labour and social security (3.5%), public works and transport (3.5%), health (3.5%), and public security (2.8%). Education receives a 5.3% increase in resources compared with 2025, while health and public security received increases of 18.6% and 9.7% respectively. The 2026 budget proposal is predicated on growth projections for 2025 and 2026 of 3.8% and 3.5% respectively. As regards inflation, the government’s proposal highlights that annual inflation was running at -0.22% in the second quarter of 2025, below the 3.0% +/-1 percentage point tolerance range. It projects that inflation will return to the target range in the second quarter of 2026. The budget initiative now goes to the national 57-member unicameral congress to be discussed and voted upon.

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