The cost of living in Costa Rica is 20% more than in other countries in Latin America, according to the 20th Anuual State of the Nation report released this week. The rising cost of electricity and staple foods such as rice are cited as the chief drivers of the rising cost of living.
The international report may surprise analysts because last year the Central American country reported that inflation had hit the historical lows of 3.7%.
What is a matter of concern for Costa Rica is that its poor have remained poor despite 20 years of relentless economic growth. People living below the poverty line account for more than 20% of the population. This figure has hardly changed in the last 20 years.
Elsewhere in Latin America, the report says, the middle class population has gone on expanding. Like other Latin American countries, Costa Rica also has put in place several social welfare programs to help the poor. But the gulf between the haves and have-nots seems to never decrease.
However, some services and goods are cheaper in Costa Rica than in other countries in the region. Telecom services, for example, are 64% cheaper than the regional average.
According to the report, Costa Rica has generated a lot of skilled jobs but not a similar number of skilled labors. The report has suggested that the government look for better ways to equip youths with skills sought by the modern economy.
Another concern is that the school dropout rate in Costa Rica is high. More than 50% of today’s job seekers have not graduated from high school. Providing training to jobless youths would decrease the poverty rate significantly, the report noted.