LatinNews Daily - 26 September 2018

Costa Rica:  Rodrigo Cubero, the president of Costa Rica’s Central Bank (BCCR), and the finance minister, Rocío Aguilar, have announced that the BCCR will purchase C$498.8bn (US$862m) worth of treasury bonds, issued by the finance ministry. This is the first time the mechanism has been used since 1994 and is a temporary measure to address the fiscal deficit which closed at 6.2% of GDP in 2017. The announcement comes as Costa Rica’s main trade union, Asociación Nacional de Empleados Públicos (Anep), has been staging a national strike since 10 September against a proposed fiscal reform initiative put forward by the Partido Acción Ciudadana (PAC) government led by President Carlos Alvarado, which would replace the current sales tax with a 13% value-added tax (VAT) and increase the number of products and services to be taxed, among other measures. On 24 September the president of the 57-member unicameral national legislature, Carolina Hidalgo (PAC), said she was currently analysing 373 motions to determine whether the fiscal reform initiative meets the requirements to be discussed by the plenary, while yesterday President Alvarado called for the national assembly to approve the fiscal reform next month.

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