Discusses key economic indicators and trade statistics, which countries are dominant in the market, the U.S. market share, the political situation if relevant, the top reasons why U.S. companies should consider exporting to this country, and other issues that affect trade, e.g., terrorism, currency devaluations, trade agreements.
Last Published: 10/18/2019
Costa Rica is the oldest continuous democracy in Latin America with moderate economic growth rates (3.3 percent in 2018).  The country’s relatively well-educated, labor force focuses on English-language instruction, relatively low levels of corruption, geographic proximity, living conditions, and attractive free trade zone incentives also offer strong appeal to exporters and investors.  In recent decades, the Costa Rican government has focused on attracting investment from relatively high-tech manufacturers, such as electronics and medical devices, as well as continued development of the dynamic tourism sector. 

The current administration of Carlos Alvarado, which began its four-year term on May 8, 2018, belongs to the same political party as the previous administration of Luis Guillermo Solis.  The Solis administration’s contributions to Costa Rica’s already-strong business climate included government support for Costa Rica’s continuing export and investment promotion efforts, sustained and concerted effort in furthering Costa Rica’s aspiration to become an OECD member, near-completion of Costa Rica’s major new Atlantic Coast container terminal (due to open in mid-2019), implementation of significant financial-sector laws and regulations against money laundering, and avoidance of major labor unrest. 

Current domestic issues include Costa Rica’s persistent fiscal deficit, internal bureaucracy, the high cost of energy, and the state of basic infrastructure.  Over the next several years, plans are in place for major upgrades involving rail, ports, airports, highways and water systems.   The World Bank’s “Doing Business 2018” ranked Costa Rica 61 out of 190 countries world-wide.

Costa Rica ratified the Central American Free Trade Agreement (CAFTA-DR) with the United States in 2009.  This free trade agreement eliminated most of the tariffs for non-agricultural imports and has made both trade and investment in the region more attractive to U.S. companies.  The remaining tariffs on virtually all U.S. agricultural products will be eliminated by 2020.  CAFTA-DR member countries have further promised increased transparency in customs dealings, anti-corruption measures in government contracting and procurement, and strong legal protections for U.S. investors.

The United States is Costa Rica’s largest trade and investment partner.  Approximately 53% of all Foreign Direct Investment, and 40% of all imports are of U.S. origin.  There are no restrictions on capital flows in or out of Costa Rica nor on portfolio investment in publicly traded companies, but companies are subject to local taxes.  Foreigners can own property with no title restrictions, although special care must be taken to comply with laws governing coastal areas.

 

Prepared by our U.S. Embassies abroad. With its network of 108 offices across the United States and in more than 75 countries, the U.S. Commercial Service of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the U.S. Commercial Service trade specialist in the U.S. nearest you by visiting http://export.gov/usoffices.



Costa Rica Trade Development and Promotion