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11 Straight Weeks of Rising Oil Prices Threatens to Derail Nicaragua’s Economy

Article Summary:

Eleven consecutive weeks of rising gas prices and the announcement of transportation fare increases, along with rising food and building material costs, are cause for concern for Nicaragua’s struggling economy.

Photo Credit: El Financiero

Original Article Text From El Financiero via Google Translate :

Oil threat Nicaraguan Economy

Eleven consecutive weeks of increases in gasoline prices and the announcement of increases in intercity transportation fares, food and building materials, among others, are caused to Nicaragua by the rise in the value of oil in the international market, which according to independent economists, can affect the growth projections.

The business sector in general is concerned about the impact on oil prices, although the country has an agreement with Venezuela under preferential treatment, and the effect is already seeing inflation.

Also recently implemented an increase of 9% to the price of electricity, whose generation is based mostly in oil.The Government also remains in effect subsidizing the electricity tariff, because otherwise, the rise in this area would be higher and would cause a serious blow to the pockets of consumers.

Mario Arana, director of the Nicaraguan Foundation for Economic and Social FUNIDES EF told that indeed the price of oil is a serious problem for the country that could, at the end of the year, affect the projected growth rate.He added that it is still early to estimate the end of the year, but found that working in conservation and efficiency policies on energy, because no impact on competitiveness, inflation and a contraction in the economy.

Arana estimated that the oil bill this year will be high, if you keep the uptrend in oil prices in the international market.

Link to Original Article:

From El Financiero

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