Business in Costa Rica economy foreign trade exports imports

Course summary (Doing business in Costa Rica)

Costa Rica has a strong legal system that manages the ‘Judicial Power’, which ensures law compliance and covers nationals, as well as foreigners within the country’s territory. The 2008 World Bank Study for Global Governance Indicators ranks Costa Rica in the first place within Latin America for political stability.

One of the pillars of the Costa Rican economic development has been trade liberalization, which has allowed exports to surpass its 30% ratio of GDP in 1980 to a current 50% rate (includes exports of goods and services).

This trade liberalization has been followed by a series of structural changes resulting in productivity growth, diversification of the economy and a higher level of investment. The real GDP has been increasing at a compound annual growth rate of 5.3% since 1991. All these changes have translated into important social achievements. In the last 20 years poverty was reduced from 40% to less than 20%.

Costa Rica has positioned itself as a key destination for operations of multinational companies in a variety of industries, such as Advanced manufacturing, Medical Devices and services. Over 200 global companies have chosen Costa Rica as an establishment location.

- Costa Rica is the 4th high-tech exporter in the world (World Development Indicators 2008, World Bank)

- One of the most competitive destinations in Latin America for service operations (A.T. Kearney, Destination Latin America: A Near-Shore Alternative 2009)

- FDI per capita = $448. Costa Rica is one of the most competitive locations, above Latin America’s largest economies like Brazil, Mexico and Chile. The total FDI inflows have grown an average 22% every year since 2000

- Costa Rica’s per capita GDP per capita is almost 7 times higher than China

- Costa Rica has become an important near shore location for companies from the U.S., as well as a strategic offshore location for European companies in the dollar zone, for European-based companies.

- Exports: $8.847 billion. Products: integrated circuits, medical equipment, bananas, pineapples, coffee, melons, ornamental plants, sugar, textiles, electronic components, medical equipment.
- Major markets (2008): U.S. 23.9%, Netherlands 13.3%, China 12.9%, U.K. 5%, Mexico 4.9%.

- Imports: $10.87 billion: raw materials, consumer goods, capital equipment, petroleum.
- Major suppliers (2008): U.S. 42.7%, Mexico 6.9%, Venezuela 6.3%, Japan 5.4%, China 4.7%, Brazil 4.2%.

The Services Sector has been growing during the last 10 years, from 1 company in 1995, to a total of 95 companies and 28,416 employees in 2009.

Intel in Costa Rica. Costa Rica is home to Intel’s only production site in Latin America. The local factory is focused on the assembly and testing of microprocessors and chipsets, product development, and customer support. Intel Costa Rica is also an international distribution center and a strong back-office organizational function supporting several business groups including Finance, Materials, Planning, Information Technology, and Employee Services. It is located in Heredia near San José. The facilities in La Ribera occupy 126 acres and include one manufacturing plant and one distribution center dedicated to the assembly, testing and distribution of the world's fastest processors.

Since the mid 1990’s Café Britt thought of the International Airport in Costa Rica as a place where the traveler must find our products. Grupo Britt decided to expand internationally not so much by exporting its products, but primarily by exporting its business model. The Company decided to actively pursue international markets and invested in Peru (2005), Curaçao, Netherlands Antilles (2006), Chile (2007), Miami, St. Thomas (2008), Antigua and Barbuda (2009) and Mexico (2010).

Borders of Costa Rica: Nicaragua, Colombia and Panama.

International Economic Relations. Costa Rica is member of: Central American integration system (SICA), Association of Caribbean States (ACS), Latin American and Caribbean economic System (SELA), Mesoamerica project, Inter-American Development Bank (IDB), Economic Commission for Latin America (ECLAC), Forum for East Asia-Latin America Cooperation (FEALAC), Organization of American States (OEA), World Bank, IMF, World Trade Organization (WTO), United Nations, ALADI (observer) ...

Costa Rica has Free Trade Agreements (FTA's) with: China, FTA Mexico - Costa Rica and Chile. European Union - Central America Association Agreement, CAFTA-DR United States - Central America- Dominican Rep FTA

Business, Costa Rica, Economy, Costa Rican foreign trade, Opportunities, Sector, services, manufacturing, Advanced Devices, Medical, Exports, Imports, FDI