BLP’s summary of the most important regional news and opportunities offers an overview of the economic, social, and political landscape of Central America at just a click away.
Costa Rica Plans a New Generation of Strategic Road Infrastructure
Costa Rica’s Ministry of Public Works and Transportation is moving forward with plans for nine road corridors to improve the country’s connectivity, including sections leading to the borders with Panama and Nicaragua, as well as strategic projects along the Pacific coast. Notable projects include the Liberia-Peñas Blancas and Palmar Norte-Paso Canoas routes, which will connect to the main border crossings, as well as the modernization of the Río Frío-Tablillas corridor toward Nicaragua. On the Pacific coast, preparations are underway for the expansion of the Costanera between Pozón de Orotina and Jacó, as well as road improvements between Barranca and Caldera—a strategic connection to the future modernized port of Caldera. In Guanacaste, work will begin on widening the road to four lanes between Comunidad and Nicoya—a 64-kilometer stretch announced during a recent government tour of the province. These projects represent a new generation of infrastructure investments that will strengthen the country’s logistics, border trade, and tourism connectivity in the coming years.
Costa Rica Emerges as a Regional Leader in Cyber Resilience
Costa Rica ranked as the second-most cyber-resilient country in the Caribbean and Central America, with a score of 53%, according to SISAP’s Regional Cyber Resilience Ranking, trailing only the Dominican Republic, which scored 54%. This result far surpasses those of other countries in the region, such as Panama, El Salvador, Guatemala, Honduras, and Nicaragua, reflecting the country’s strengthened capabilities to prevent, respond to, and recover from cyber incidents. SISAP’s CEO noted that this progress reflects the strengthening of Costa Rica’s cybersecurity and governance capabilities. He also stressed that investment in talent and protective technologies must remain consistent given the growing integration of artificial intelligence into organizations. The study identifies the government, financial services, and manufacturing as the sectors with the greatest potential economic exposure to a cyberattack, accounting for nearly 91% of the national economic risk. This regional leadership position reinforces investor and business confidence in Costa Rica’s technological and digital strength.
Costa Rica Strengthens Dialogue Between the Government and the Business Sector to Boost Competitiveness
More than 150 representatives from companies affiliated with the Costa Rican Chamber of Commerce participated in a Business Dialogue with President Laura Fernández Delgado, a forum aimed at strengthening communication between the government and the business sector to boost competitiveness, attract investment, and create formal jobs. During the meeting, strategic issues were addressed, such as trade facilitation, government reform, infrastructure, and the harmonization of the electricity system. The president reaffirmed her commitment to maintaining an ongoing dialogue with the country’s chambers of commerce and highlighted the progress of strategic road, port, airport, and rail infrastructure projects as pillars for attracting new investment. The Chamber of Commerce noted that, of the 29 public policy proposals it presented during the election campaign, the president endorsed 22, aimed at strengthening competitiveness and simplifying regulations. This type of cooperative forum between the public and private sectors helps solidify a joint agenda to boost investment, formal employment, and the business climate in Costa Rica.
Costa Rica Updates Its Methodology for Measuring Inflation
The National Institute of Statistics and Censuses updated the methodology for calculating the Consumer Price Index, incorporating 43 new goods and services—such as in-home care, psychological services, and mandatory auto insurance—and adjusting the calculation base to June 2026, with the aim of better reflecting the current consumption patterns of Costa Rican households. With this update, year-over-year inflation stood at -0.28% at the end of July, reflecting a trend toward a smaller negative variation from the -2.73% recorded in February. Among the goods that showed the largest price reductions were international airline tickets, chicken eggs, and taxi fares, all of which helped to reduce pressure on Costa Rican household spending. Meanwhile, some categories, such as housing, educational services, and healthcare, recorded slight increases. This methodological update allows for a more precise and representative measurement of the Costa Rican economy, thereby enhancing the quality of information available for economic decision-making.
Costa Rica Maintains a Competitive Tax Burden Compared to OECD Countries
Costa Rica has a tax burden equivalent to 24.8% of its GDP, which is 9.3 percentage points below the average of the 38 member countries of the Organization for Economic Cooperation and Development (OECD), which stands at 34.1%. This level of tax revenue places the country in a competitive position compared to economies with considerably higher tax burdens, such as France (43.5%), Denmark (45.2%), and Austria (43.4%). Costa Rica shares this profile of lower tax pressure with economies such as Ireland (21.7%) and Switzerland (27.2%), which are recognized for their appeal to foreign investment. This environment of lower tax pressure can be a competitive advantage for companies operating in the country, complementing other factors such as institutional stability and the workers’ quality of training and experience. The government also recently presented a fiscal plan with more than 15 bills aimed at modernizing electronic invoicing and strengthening tax controls, seeking to balance fiscal sustainability without compromising the country’s competitiveness.
El Salvador Leads Economic Growth in the Region
El Salvador recorded the strongest expansion of economic activity in Central America at the end of May 2026, with a year-over-year growth rate of 5.39%, according to the Monthly Economic Activity Index published by the Executive Secretariat of the Central American Monetary Council (SECMCA). The CARD region (Central America and the Dominican Republic) as a whole showed a year-over-year change of 3.61%, with Guatemala ranking as the second-fastest-growing Central American country, with growth of 3.72%, followed by Costa Rica (2.28%), Honduras (1.76%), and Nicaragua (0.93%). El Salvador’s leadership was driven primarily by the construction industry, which grew 9.7% thanks to progress on residential and commercial projects, as well as public works in road and educational infrastructure. This regional performance reflects a widespread acceleration of economic growth in Central America, consolidating new investment opportunities in construction, infrastructure, and services throughout the region.
El Salvador Posts Five Consecutive Months of Strong Economic Growth
El Salvador’s Economic Activity Volume Index recorded 5.6% growth in May 2026, marking five consecutive months with growth rates of 4% or higher, according to the Central Reserve Bank. Construction remained the most dynamic sector, growing by 9.7%, supported by greater availability of housing financing and a 21.5% increase in cement consumption. Real estate services grew by 7.0%, driven by the development of residential and commercial projects, while the loan portfolio for home purchases and construction increased by 13.9%, reaching US$3.51 billion. Trade, transportation, hotels, and restaurants grew by 6.7%, and financial and insurance activities grew by 4.7%, supported by the expansion of deposits, loans, and digital transactions. Industrial production also posted a positive growth of 4.5%, with the pharmaceutical and food industries standing out, confirming the strength and diversification of El Salvador’s economic growth.
El Salvador Boosts its Manufacturing Industry with a Rebound in Food and Pharmaceuticals
El Salvador’s Industrial Production Index grew 4.3% in June 2026, driven by strong performance in the food and beverage, pharmaceutical, and maquila sectors, according to the Central Reserve Bank. The food industry stood out for its processing of meat, poultry, and deli meats, boosted by increased restaurant trade during the 2026 FIFA World Cup, as well as a rebound in the manufacturing of canned tuna and dairy products. The pharmaceutical industry benefited from winning bids in both domestic and international markets, while the maquila sector saw a strong rebound in exports of electrical components to the United States. The construction sector also remained in positive territory, with a 3.2% increase in cement bag production and a 69.5% rise in imports of this material. This performance confirms the strength and diversification of El Salvador’s manufacturing industry, driven by both domestic demand and sustained export growth.
IMF Recognizes the Strength of El Salvador’s Banking System in the Age of Digital Assets
The Deputy Managing Director of the International Monetary Fund highlighted the health of El Salvador’s banking system during a speech on stablecoins in emerging markets, noting that bank credit and deposits continue to grow at healthy rates despite the country’s dynamic digital asset ecosystem. According to the Central Reserve Bank, as of the first half of 2026, the loan portfolio reached US$21,804.4 million, representing 8.5% growth, while deposits reached US$24,668.1 million, an increase of 12.9%. Katz explained that dollarization, adopted by El Salvador two decades ago, serves as a mechanism that strengthens incentives for sound macroeconomic management by increasing the costs of potential policy mismanagement. The country maintains a US$1,400 million assistance program with the IMF, approved in February 2025. This international recognition confirms the strength and stability of El Salvador’s financial system, reinforcing investor confidence in its ability to adapt to innovation in digital assets.
El Salvador Is Diversifying Its Export Basket with a Mix of Textiles, Agribusiness, and Technology
T-shirts, sweaters, sugar, coffee, and electrical components topped El Salvador’s list of the 10 leading export products during the first half of 2026, collectively accounting for 42.1% of total exports, according to the Central Reserve Bank. Knitted T-shirts remain the top export, at US$233.10 million, followed by sweaters, which grew by 14.6%, and cane sugar, which rose 24.4%, driven by favorable international prices. Coffee recorded notable growth of 25.9%, reaching US$148.95 million, while electrical capacitors—components used to store and manage energy—grew by 39.4%, reflecting the increasing sophistication of El Salvador’s export industry. Other notable products include electrical wires and cables, toilet paper, petroleum oils, and baked goods, which together total US$1,431.58 million. This diversification of the export basket—which combines traditional textiles with agro-industrial products and technological components—confirms the strength and evolution of El Salvador’s productive sector toward higher-value-added sectors.
Guatemala Strengthens its International Connections with a New Direct Flight to Toronto
Guatemala will expand its air connectivity with Canada starting in December 2026, when Air Canada launches a direct, year-round flight between Guatemala City and Toronto, adding to the existing connection with Montreal. The new route will also provide access from Toronto to other international destinations, including European cities such as Zurich and Vienna. This expansion is part of a sustained growth in the country’s air connectivity: between 2023 and 2025, operations at La Aurora Airport increased by nearly 5%. By June 2026, 16 airlines were already operating there, in a network covering nearly 40 cities. This year has also seen the addition or announcement of connections to Medellín, Guadalajara, San Francisco, and Boston. The increased number of routes strengthens opportunities for tourism, business, and exchange with international markets, benefiting hotels, restaurants, tour operators, transportation providers, and communities.
Guatemala Faces the Challenge of Turning its New Ports Law into Concrete Results
The passage of the National Port System Act marked the end of decades of regulatory lag in Guatemala, but it also opened a new and decisive chapter: its implementation. According to Jorge Briz, president of the Guatemalan Chamber of Commerce, the law sends a clear message to domestic and foreign investors that the country is committed to modernizing its logistics infrastructure through clearer, more predictable rules that incorporate principles of free competition and private-sector participation. José de la Peña, chairman of the Board of Directors of EMPORNAC, emphasized that the law does not privatize state-owned ports but rather updates the legal tools to develop them more efficiently, including public-private partnerships and greater flexibility to contract specialized services such as dredging. Both agreed that the ultimate goal is to transform Guatemala into a regional logistics hub capable of receiving and redistributing goods throughout Central America and connecting with other continents. The success of the reform will depend on the new National Port Authority acting with technical independence, transparency, and a comprehensive logistics vision, which will help attract long-term investment and consolidate more efficient and competitive ports for Guatemalan trade.
Honduras Outlines a Roadmap to Attract Investment in Rural Areas with International Support
With support from the FAO, Honduras presented the Incentive Strategy for the Development of the Agri-Food Sector 2026–2030, a plan aimed at attracting investment, boosting productivity, and incorporating technology into the agricultural sector’s value chains. The Honduran government, in collaboration with the FAO and private-sector partners, launched the initiative. The agri-food sector accounts for nearly 13% of GDP, more than 35% of exports, and represents about 23% of national employment. The secretary general of the National Investment Council emphasized that every investment in the rural sector strengthens productive activity, creates jobs, and incorporates technology, thereby improving the country’s competitiveness. The strategy was developed within the framework of FAO’s “Mano a Mano” initiative, with the participation of the Secretariat of Agriculture and Livestock and international organizations such as World Vision and ActionAid. This roadmap aims to transform Honduran agriculture into a bridge of trust, to attract investment, reduce investment risks, and open new business opportunities for local producers and international investors.
Honduras Confirms a Stabilizing Trend in Prices
Honduras’ year-over-year inflation slowed for the second consecutive month in July 2026 to 5.58%, down from the 5.83% recorded in June, according to the Central Bank of Honduras. This trend reflects reduced pricing pressure amid greater geopolitical stability on the international stage, which helped ease inflationary pressures affecting the Honduran economy. Moreover, the Consumer Price Index recorded its smallest monthly change in six months, with an increase of just 0.15% in July, down from 0.19% in June. Inflation pressure indicators also showed signs of moderation, with the magnitude indicator falling to 0.33% and the persistence indicator declining to 64.69%. The Central Bank attributed part of this moderation to lower prices for diesel, gasoline, and certain industrialized products, as well as the positive effect of its monetary policy through open market operations. This trend toward price stabilization strengthens confidence in Honduras’ macroeconomic management and contributes to a more predictable environment for investment and consumption.
Honduras Moves Forward with Its Commitment to International Financial Transparency
Honduras has begun the Fifth Round of Mutual Evaluations of the Financial Action Task Force of Latin America (GAFILAT), a process that, over the next 18 months, will assess the country’s effectiveness in preventing money laundering, terrorist financing, and the proliferation of weapons of mass destruction. President Nasry Asfura welcomed the organization’s delegation and expressed the government’s willingness to actively participate in the process, which involves joint coordination among institutions of the three branches of government. This evaluation is part of the mechanism through which GAFILAT assesses its member countries’ compliance with international standards. Honduras’ active participation in this process reinforces its institutional commitment to financial transparency and strengthens the confidence of international organizations and investors in the soundness of the country’s regulatory framework.
Nicaragua Accelerates Its Digital Transformation with Remarkable Growth in Electronic Payments
The Central Bank of Nicaragua reported strong growth in transactions processed through the country’s payment systems during the first quarter of 2026, with 4.5 million transactions totaling 790,178.7 million córdobas, representing a year-over-year increase of 30.6% in value and 49.2% in volume. The Nicaraguan Interbank Electronic Payment System (SINPE) recorded a 32.5% increase, while the UNIRED system showed transaction growth of 72.1%, a remarkable performance. The report also highlighted the growing use of digital payment instruments, with 3.8 million cards in circulation and 846,094 digital wallet users, a 41.8% increase in transactions through remote channels such as online banking and online payment gateways. This momentum confirms the rapid modernization of Nicaragua’s financial system and its growing adoption of digital technologies, thereby enhancing efficiency and access to financial services in the country.
Central America Is Driving a Logistics Revolution That Promises to Transform Regional Trade
The countries of Central America, Panama, and the Dominican Republic agreed to move forward with Cargo Pass, a regional strategy to transform freight mobility by integrating technology, infrastructure, and greater regulatory harmonization. The commitment was made during a ministerial dialogue organized by the Inter-American Development Bank, as part of the regional program “América en el Centro.” The initiative calls for an initial investment of US$130 million in the Pacific Corridor, the region’s main logistics route, through which nearly 70% of Central American cargo is transported, with the potential to generate up to US$700 million in annual economic benefits through greater efficiency and lower logistics costs. Panama’s Minister of Economy emphasized that a pilot corridor will allow for concrete measurement of reductions in transit times and transportation costs. The IDB will prepare an institutional framework and a roadmap to implement the strategy gradually, with a comprehensive proposal to be presented in the first quarter of 2027. This regional initiative strengthens Central America’s competitiveness and opens up new investment opportunities in logistics, infrastructure, and foreign trade.
BLP INSIGHT
Guatemala Approves the General Law on the National Port System
The Congress of the Republic of Guatemala approved Decree 20-2026, the General Law on the National Port System, which establishes a comprehensive regulatory framework for the planning, regulation, oversight, and operation of the country’s port system. The law creates the National Port Authority as the governing body and incorporates new rules on port infrastructure, concessions, authorizations, private participation, oversight, and the penalty regime. The law will have significant implications for port infrastructure projects, private-sector participation, and contracts involving public port companies, including provisions to ensure the continuity of existing operations during the transition to the new regulatory framework. Its implementation is still subject to presidential approval, publication in the Official Gazette, the establishment of the National Port Authority, and the issuance of the corresponding regulations.
From Formal Ownership to Effective Control: A New Era of Corporate Transparency in Honduras
Legislative Decree No. 127-2026, the Law on Transparency and the Centralized Registry of Ultimate Beneficiaries, establishes new obligations to identify and report the individuals who ultimately own or exercise effective control over corporations and other legal structures. The legislation creates the Centralized Registry of Ultimate Beneficiaries (RCBF), which eliminates the possibility of maintaining or issuing bearer shares, and mandates their conversion to registered shares. The new rules will have significant implications for due diligence processes, mergers and acquisitions, financing, banking compliance, and transactions with international investors and counterparties. Implementation of the law will require the development of its regulations and of the RCBF’s technological platform, as well as the strengthening of oversight mechanisms.
ECONOMIC INDEX
| Country | Exchange Rate (local currency per USD) | Basic Passive Rate (local currency) | Monetary Policy Rate | Sovereign Debt | Year-on-Year Inflation | ||
|---|---|---|---|---|---|---|---|
| S&P | Moody’s | Fitch | |||||
| Costa Rica | 451.89 | 3.65% | 3.00% | BB | Ba2 | BB | -0.27% |
| El Salvador | 8.75 | 4.06% | N/A | B- | B3 | B- | 2.76% |
| Guatemala | 7.62 | 4.65% | 3.50% | BB+ | Ba1 | BB+ | 2.70% |
| Honduras | 26.82 | 7.23% | 5.75% | BB- | B1 | N/A | 5.58% |
| Nicaragua | 36.62 | 1.31% | 5.75% | B+ | B2 | B | 3.98% |
14/08/2026 | Source: secmca.org
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