Comments on: Exporters fear, warn against floating colon, continue to lose millions to poor exchange rate

By: Ken Morris

Ken Morris — Wed, 20 Mar 2013 22:33:50 +0000

The main explanations for the lower value of the dollar in CR are laundered drug money and speculative investments. Both attract unproductive dollars to the country, which lowers the value of the dollar inside the country by the basic rules of supply and demand. Nicaragua has neither of these inrushes of dollars, so the cordoba is basically just reflecting both internal inflation and the global value of the dollar. Letting the colon float (and the dollar drop more in value) would actually help combat both these sources of incoming unproductive dollars, but probably not enough to do much good. There needs to be other policy changes. Also, lowering the band, which is likely to happen, will have nasty short-term consequences.

By: Patrick Smyth

Patrick Smyth — Wed, 20 Mar 2013 20:33:37 +0000

Panama is on the dollar and it has an inflation rate of 5.7% while it is 6.52% in CR. As stated, the exporters will lose out if they move to the dollar.

By: Daniela Rosaura

Daniela Rosaura — Wed, 20 Mar 2013 18:33:33 +0000

John G Dungan Sr My theory is that the government, which is always pathetically broke, began surreptitiously skimming dollars by the exchange rate. This seems especially notable just before the gov’t has to pay the aguinaldos.

By: Siegfried Gust

Siegfried Gust — Wed, 20 Mar 2013 16:18:40 +0000

If you money is increasing in value the nation as a whole gains buying power for foreign goods. The problem being, if the Colon gains value against the dollar all these big companies that export to the US will be getting less Colones for their products. Hence the worries.

By: Siegfried Gust

Siegfried Gust — Wed, 20 Mar 2013 16:18:40 +0000

As far as I understand it, it’s not the the Colon is gaining value so much as the Dollar is losing value. The Cordoba is just losing value faster than the Dollar.

By: Mickey Atkinson

Mickey Atkinson — Wed, 20 Mar 2013 15:33:34 +0000

In Nic. in 06 the Corodoba was 17.4 to the dollar now it is 24 to the dollar. Why is the dollar down in CR?

By: John G Dungan Sr

John G Dungan Sr — Wed, 20 Mar 2013 15:33:34 +0000

Excellent question, Mickey. When I moved there in 2009, it was doing nicely at around 580-590 to the dollar, and then it dumped all of a sudden, and has never recovered. And, no one ever offered a reason that made any sense, as far as I know.

By: John G Dungan Sr

John G Dungan Sr — Wed, 20 Mar 2013 14:48:34 +0000

Not being an economist or mathematician, I have no clue what this means, but it seems to me that if your money is increasing in value, you should be making money, instead of losing it. If this is so important to all of these people, maybe Costa Rica should consider just giving up the Colon altogether, and go to a Dollar economy. I do know that the loss of value for my dollars was a factor in our decision to leave Costa Rica.

By: Roman Fino

Roman Fino — Wed, 20 Mar 2013 14:48:34 +0000

If they gave up the Colon” how do they go to the bathroom???…..Thank you thank you Ill be here all week ladies and gents…..