Nearly 30% of Costa Rica GDP comes from informal economy

SAN JOSE, COSTA RICA – September 27th, 2012 – From permanent installations on public streets to businesses operating without licenses, Costa Rica’s informal economy is booming, and this has “formal” merchants and the Chamber of Commerce concerned.

According to Chamber of Commerce executive director, Alonso Elizondo, close to 30% of the Gross Domestic Product in Costa Rica comes from the informal economy.

The chamber says the excess of paperwork and obstacles in order to operate legally, forces many merchants to work as informal businessmen.

“This generates unfair competition, because as the operating costs are much lower, and there is no payroll burden, this provides the possibility of providing prices that are lower than those of legal merchants. Also, if the products sold are imitations, and not original brands, the profitability will also be greater, “ said Elizondo.