ial safety net that had
been put into place by the government has eroded due to increased
financial constraints on government expenditures. Immigration from
Nicaragua has increasingly become a concern for the government. The
estimated 300,000-500,000 Nicaraguans estimated to be in Costa Rica
legally and illegally are an important source of (mostly unskilled)
labor, but also place heavy demands on the social welfare system.
Foreign investors remain attracted by the country's political
stability and high education levels, as well as the fiscal
incentives offered in the free-trade zones. Exports have become more
diversified in the past 10 years due to the growth of the high-tech
manufacturing sector, which is dominated by the microprocessor
industry. Tourism continues to bring in foreign exchange, as Costa
Rica's impressive biodiversity makes it a key destination for
ecotourism. The government continues to grapple with its large
internal and external deficits and sizable internal debt. Reducing
inflation remains a difficult problem because of rising import
prices, labor market rigidities, and fiscal deficits. Tax and public
expenditure reforms will be necessary to close the budget gap. In
October 2007, a national referendum voted in favor of the US-Central
American Free Trade Agreement (CAFTA).

Cote d'Ivoire
Cote d'Ivoire is the world's largest producer and
exporter of cocoa beans and a significant producer and exporter of
coffee and palm oil. Consequently, the economy is highly sensitive
to fluctuations in international prices for these products, and, to
a lesser extent, in climatic conditions. Despite government attempts
to diversify the economy, it is still heavily dependent on
agriculture and related activities, engaging roughly 68% of the
population. Since 2006, oil and gas production have become more
important engines of economic activity than cocoa. According to IMF
statistics, earnings from oil and refined products were $1.3 billion
in 2006, while cocoa-related revenues were $1 billion during the
same period. Cote d'Ivoire's offshore oil and gas production has
resulted in substantial crude oil exports and provides sufficient
natural gas to fuel electricity exports to Ghana, Togo, Benin, Mali
and Burkina Faso. Oil exploration by a number of consortiums of
private companies continues offshore, and President GBAGBO has
expressed hope that dai