Thursday, January 22, 2009

Nicaragua: Economy and Exports

The Nicaraguan currency is the gold cordoba but the U.S dollar is accepted virtually everywhere. The current exchange rate is 19.35 Cordobas to 1 U.S dollar.
Nicaragua is a agricultural country and its national economy is based largely on exporting goods. The Central America Free Trade Agreement (CAFTA) has been in effect since 2006 and has helped Nicaragua to expand its export opportunities.
Nicaragua exported $2.313 billion worth of goods in 2007. Major export commodities for the country included; coffee, beef, , tobacco, sugar, peanuts, shrimp and lobster. Even though Nicaragua is located in Central America, its largest trading partner, by far, was the United States whom it sent 31.7% of its exports in 2007. The country's next largest trading partners were El Salvador 14%, Honduras 9.3%, Costa Rica 7.2%, Canada 5.8%, Guatemala 5.5%, and Mexico 4.8%.
Even with the rising potential of Nicaragua's exporting capabilities the country continues to have widespread underemployment and unemployment. It has the third lowest per capita income in the western hemisphere and one of the highest levels of income inequality in the world. The economy has moved toward increased stability in recent years and Nicaragua has also recieved help with foreign debt reduction which will hopefully help to improve the country's GDP which has been far too low to meet the needs of its citizens.

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