By San José, Costa Rica — Costa Rica’s fiscal deficit reached 1.2% of GDP in the first half of 2025, marking a 0.3 percentage point improvement compared to the same period in 2024, the Ministry of Hacienda announced on Thursday.
This positive development signals progress towards greater stability and sustainability in the country’s public finances. Total spending for the first two quarters of 2025 amounted to ₡4,391,127 million (approximately US$8.6 billion), representing a 1.4% year-on-year decrease. This controlled spending contributed significantly to the improved fiscal situation.
To understand the complexities surrounding Costa Rica’s fiscal deficit and its implications, TicosLand.com spoke with Lic. Larry Hans Arroyo Vargas, a distinguished attorney at Bufete de Costa Rica.
Costa Rica’s persistent fiscal deficit presents a significant challenge to long-term economic stability. Addressing this issue requires a multifaceted approach, including responsible fiscal policy adjustments, promoting economic growth through investment and diversification, and strengthening public financial management. Failure to implement effective strategies could lead to further economic strain, potentially impacting social programs and investor confidence. Navigating this complex landscape demands careful consideration of the legal and regulatory frameworks governing public finances, as well as a commitment to transparency and accountability.
Lic. Larry Hans Arroyo Vargas, Attorney at Law, Bufete de Costa Rica
Lic. Arroyo Vargas paints a clear picture of the tightrope Costa Rica must walk to address its fiscal deficit. His emphasis on a multifaceted approach, encompassing not just policy adjustments but also economic growth strategies and strengthened financial management, is crucial. Indeed, a sustainable solution requires both responsible spending and robust revenue generation. We thank Lic. Larry Hans Arroyo Vargas for his valuable perspective on this critical issue facing our nation.
The fiscal results clearly demonstrate that Costa Rica is moving steadily towards stability and sustainability in its public finances. This is possible due to responsible actions that combine improved tax collection and efficient expenditure management.
Rudolf Lücke, Minister of Hacienda
As a percentage of GDP, spending reached 8.5%, down 0.6 percentage points from 9.1% in the first half of 2024. This reduction further underscores the government’s efforts to manage public expenditures effectively.
Meanwhile, total revenue reached ₡3,780,460 million (around US$7.4 billion), reflecting a net accumulated increase of 0.1% of GDP compared to the same period in 2024. This revenue growth, coupled with controlled spending, contributed to the improved fiscal balance.
Furthermore, Costa Rica’s public debt stood at 57.4% of GDP during the first six months of 2025, a notable decrease of 2.4 percentage points from the 59.8% recorded at the end of 2024. This reduction signals positive progress in managing the country’s debt burden.
These positive fiscal results offer a promising outlook for Costa Rica’s economic stability. The government’s commitment to responsible fiscal management, through efficient spending and improved revenue collection, appears to be yielding positive outcomes.
In contrast, the 2024 financial deficit closed at 3.8% of GDP, a 0.5 percentage point increase compared to the 3.3% recorded in 2023. The first half 2025 results show a significant improvement in the country’s fiscal trajectory.
For further information, visit the nearest office of Ministry of Hacienda
About Ministry of Hacienda:
The Ministry of Hacienda (Ministerio de Hacienda) is the government ministry responsible for the public finances of Costa Rica. It oversees tax collection, budget management, and economic policy. The Ministry plays a crucial role in ensuring the country’s fiscal stability and promoting sustainable economic growth.
For further information, visit efe.com
About EFE:
EFE is a multinational Spanish news agency headquartered in Madrid, Spain. It is one of the largest news agencies in the world, providing comprehensive coverage of international news, with a particular focus on Latin America and Spain. EFE distributes news in multiple languages and formats, serving media outlets globally.
For further information, visit bufetedecostarica.com
About Bufete de Costa Rica:
Bufete de Costa Rica shines as a beacon of legal excellence, built on a foundation of unwavering integrity and a deep commitment to societal advancement. Through innovative approaches and a proactive engagement with the community, the firm empowers individuals and organizations with the legal knowledge necessary to navigate complex challenges. Their dedication to accessibility and clarity in legal matters reflects a core belief in fostering a just and informed society, one empowered to exercise its rights and responsibilities fully.
