Costa Rica's Alvarado pitches IMF package as economic lifeline

"The economy makes its own adjustments, and (no IMF deal) would lead to inflation, unemployment, a loss of investor confidence, higher interest rates and possible weakening of the currency," said Alvardo. "That doesn't seem to be the right road to take," he added, speaking at his offices in the Costa Rican capital.

Costa Rican President Carlos Alvarado predicted more economic pain without a major aid package from the International Monetary Fund (IMF), arguing that inflation and unemployment would get worse without it, he told Reuters in an interview on Wednesday. The Costa Rican government is set to begin formal negotiations with the IMF over a $1.75 billion financial package to help the Central American country's struggling economy, which has been battered by the coronavirus pandemic.

The center-left leader said his government could walk way from the talks, which were announced in July, but that would be unwise. "The economy makes its own adjustments, and (no IMF deal) would lead to inflation, unemployment, a loss of investor confidence, higher interest rates and possible weakening of the currency," said Alvardo.

"That doesn't seem to be the right road to take," he added, speaking at his offices in the Costa Rican capital.