Wall Street Sours on Costa Rica
- Costa Rica bonds, currency pressured by growing budget deficit
- Over half a million Costa Ricans are indebted in dollars
Photographer: Peter J. Brennan/Bloomberg
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In a part of the world known for guerrillas, drug runners and fleeing emigrees, Costa Rica has long been the exception. It was an oasis of tranquility and stability -- the Switzerland of Central America, some took to calling it. American retirees flocked to its beach towns, tourists to its rain forests, investors to its bonds, and the economy churned out steady, if not always spectacular, growth rates.
But there was a weakness to that success story: a budget deficit that’s been constantly growing, slowly eroding an economy that’s become largely dependent on U.S. dollars.