A comprehensive regional assessment reveals Central America and the Dominican Republic are confronting their most severe political and social crisis in three decades. The Seventh State of the Region Report 2025, published by the University of Belize Research Office in collaboration with regional partners, presents a stark analysis of the area’s deteriorating conditions between 2018 and 2023.
The landmark study, compiled by Costa Rica’s National Council of Rectors, identifies a troubling paradox: despite moderate economic expansion, the region experiences deepening development disparities, democratic erosion, and declining regional cooperation. This growth pattern remains fundamentally exclusionary and environmentally unsustainable, failing to translate into broad-based wellbeing for the population.
Researchers pinpoint five critical, interconnected challenges threatening regional stability. Economic and social inequalities have intensified, particularly between Costa Rica, Panama, and the Dominican Republic versus their regional neighbors. Nations have reverted to pre-pandemic patterns of reduced social investment despite persistent poverty, abandoning the brief post-COVID rebound period.
The political landscape has deteriorated to its most dangerous state since the era of military conflicts, with rising autocratization fueled by public disillusionment over unmet social expectations. Regional fragmentation severely limits collective response capabilities to global power pressures, diminished foreign aid, and external economic shocks. Additionally, inadequate cooperation mechanisms, aging demographics, escalating organized crime, and poor climate adaptation coordination further undermine collective action.
The report concludes that post-pandemic governance has systematically weakened the region’s capacity to promote sustainable human development. With poverty, inequality, and institutional fragility persisting alongside declining social investment, researchers urgently call for governments to transcend short-term political calculations and rebuild democratic institutions and regional cooperation frameworks before current pressures solidify into permanent setbacks.