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GDP: On 19 July the Banco Central de Costa Rica (BCCR) raised its real annual GDP growth forecasts for 2011 and 2012. The 2011 forecast was lifted to 4.5%, from 4.3% previously, while the 2012 forecast rose to 4.7%, from 4.5% previously. In 2010 real annual GDP growth came in at 4.2%. Rodrigo Bolaños, the president of the BCCR, noted that economic growth had been a bit faster than the government had expected in the first five months of 2011, hitting 4.4%, thanks to a strong performance by the services sector.
Oil extraction: On 1 August, his first day back in charge of the environment, energy and telecommunications ministry (Minaet) following last month’s cabinet reshuffle, René Castro announced that the Chinchilla administration had declared a three-year moratorium on oil extraction, but not exploration, in the country. The moratorium effectively ends the pressure being exerted on the government by the Mallon Oil Company, a subsidiary of Black Hills Exploration and Production Inc., and by local environmentalist groups. The first wanted the government to execute a long-delayed 20 year concession contract it had secured in 2000, to explore and start production of oil and gas deposits in the north of the country, before year’s end. Chinchilla’s lukewarm gestures, that she may grant the concession, had caused controversy with environmentalists, including former president Abel Pacheco (2002-2006) who publicly condemned the government’s plans. In reality the moratorium pushed the problem on to the next administration. Castro also said the government will begin the process necessary to freeze Mallon Oil’s operations and that it is ready to pay the company damages should the courts decide that compensation applies.
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