After an economic study on Costa Rica, the Organization for Economic Cooperation and Development (OECD) issued a series of recommendations to the country, so that it improves its macroeconomic stability, has a more inclusive growth, and encourages creativity.
Costa Rica aspires to be a permanent member of this international organization, for which it must comply with a series of governmental good practices and requirements.
These are the recommendations presented by the Secretary General of the OECD, Ángel Gurría, after meeting with authorities of the current and future Government on April 17th:
1. Implement immediate measures to reduce the budget deficit by three percentage points of GDP during 2018-2020 in order to stabilize the relationship between debt and production, through a series of comprehensive measures to increase revenues, curb spending and strengthen the fiscal rule.
2. Reduce budgetary rigidities related to mandatory expenditures and allocation for specific destinations.
3. Create a fiscal council and introduce a multi-year framework of expenditures.
4. Modernize debt management by reducing the amount of reference securities (bonds) and improving communication with financial markets.
5. Adopt the bill that reforms the appointment of the President of the Central Bank; Discard the possibility that ministers or their representatives may vote on the decisions of the board of directors of the monetary authority.
6. Gradually reduce interventions in the foreign exchange market.
7. Create a bank resolution mechanism and a deposit insurance system for all banks.
8. Simplify the labor regime of the public sector to better control wage costs.
9. Continue moving towards the establishment of a smaller amount of minimum wages.
10. Implement a comprehensive plan to reduce informality, which includes greater compliance with the obligations of payment of contributions.
11. Increase the availability of child care services financed with public funds. Include all spending on education and early childhood care within the constitutional mandate for spending on education.
12. Establish better educational outcomes as the main objective of the policy, instead of focusing on spending, and developing performance indicators.
13. Adjust spending on education towards early childhood and secondary education. Strengthen specific support for at-risk students, and teacher training.
14. Boost productivity growth.
15. Adopt and implement the bill that reinforces the powers, independence and financing of the competition commission.
16. Continue the implementation of the action plan to increase consistency with the OECD Guidelines on the Corporate Governance of Public Enterprises.
17. Continue carrying out the 25 regional studies planned to evaluate the exemptions from competition and eliminate unjustified exemptions.
18. Open access to new FinTech companies, with the appropriate regulation.
19. Establish a single window for the registration and granting of business licenses. Present performance objectives. Continue improving the procedures for insolvency cases and facilitate trade.
20. Improve the coordination between the different public works organisms specifying their competences and granting general control to a single directing body. Establish project priorities based on cost-benefit analysis.