Includes how major projects are financed and gives examples where relevant. Explains activities of the multilateral development banks in and other aid-funded projects where procurement is open to U.S. bidders.
Last Published: 10/28/2019
Government institutions in Costa Rica obtain much of their project funding from multilateral development banks, such as: The Inter-American Development Bank (IDB) and the World Bank (IBRD), and from the two banks’ equity investment affiliates, the Inter-American Investment Corporation (IIC) and International Finance Corporation (IFC). The Central American Bank for Economic Integration (CABEI) and the Venezuelan Petroleum Fund (consisting of accumulated interest paid on loans to buy oil from Venezuela) are other sources of project financing in the region. The Export-Import Bank of the United States (Ex-Im Bank), the Overseas Private Investment Corporation (OPIC), and the World Bank’s Multilateral Investment Guarantee Agency (MIGA) are open for business in Costa Rica. Ex-Im Bank provides financing for the purchase of U.S. machinery, equipment and products and can be an important financing source for U.S. equipment used in major projects. OPIC provides direct loans to smaller U.S. enterprises, loan guarantees for larger projects, equity investment funds to start or expand overseas investment projects involving U.S. participation, and political risk insurance to protect against currency inconvertibility, expropriation, and political violence.  OPIC is beginning transition to the U.S. International Development Finance Corporation (USDFC) as result of the BUILD act, consolidating the capabilities of OPIC and USAID to drive economic growth and support investment in developing countries.

Recently the Costa Rican Congress approved a bill that will allow Costa Rica to acquire a loan of US$465 million from the Chinese government to finance the construction of a 107 km highway in the Limón Province, known as Ruta 32. Chinese state-owned China Harbour Engineering Company (CHEC) is responsible for the project’s completion. Meanwhile, five Costa Rican road construction companies (Codocsa, Desarrollos Mega, Pedregal, Productos de Concreto y Traesa) announced that they can develop this project for a better price than the one offered by the Chinese company.

Government procurement and projects financed by the multilateral development banks usually require a public tendering process, pre-feasibility studies, and environmental impact assessments in accordance with Costa Rican law and the relevant bank's regulations. Successful U.S. bidders usually have local representation to ensure compliance with strictly interpreted procedures. Disbursements of loans from the multilateral development banks to the Costa Rican Government are sometimes delayed by the requirement that the legislature ratify the loans, difficulties in obtaining local currency counterpart funds required by the banks, and prolonged administrative processes.

Multilateral Development Banks (World Bank, Inter-American Development Bank)
The Commercial Service maintains Commercial Liaison Offices in each of the main Multilateral Development Banks, including the World Bank and the Inter-American Development Bank. These institutions lend billions of dollars to developing countries for projects aimed at accelerating economic growth and social development by reducing poverty and inequality, improving health and education, and advancing infrastructure development. The Commercial Liaison Offices help American businesses learn how to get involved in bank-funded projects, and advocate on behalf of American bidders. Learn more by contacting the Commercial Liaison Offices to the World Bank and to the Commercial Liaison Office to the Inter-American Development Bank.


Web Resources
Commercial Liaison Offices to the World Bank
Commercial Liaison Office to the Inter-American Development Bank

 
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