Foreign companies in Costa Rica increased by forty in 2022

The Costa Rican Coalition of Development Initiatives (Cinde) registered the attraction of projects for forty new foreign companies in Costa Rica in 2022. The investment promotion agency describes this number as a “record.”

Twenty-seven companies that have set up operations in Costa Rica originate from Latin America and Europe, reported Cinde and Costa Rica’s Ministry of Foreign Trade (Comex).

According to the FDI Performance Index of new projects 2022 from the Greenfield firm, Costa Rica “attracts 15.4 times more FDI projects than the size of its economy would suggest.”

Why foreign companies invest in Costa Rica

For several important reasons, foreign companies in Costa Rica choose the Central American nation for their investments. Among these are:

• The country’s political and economic stability

Costa Rica is Central America’s leading democracy. It offers foreign direct investors an environment that provides tax incentives for those businesses that locate facilities in one of the country’s dozen free zones. Some free zones in the country are the Green Park, La Lima Free Zone, Coyol Free Zone, Zona Franca America, Zona Franca Ultra Park, and Zona Franca Metro, as well as others.

• A healthy and educated workforce

Costa Rica disbanded its military in 1949. Since then, the country has invested savings from this action in the health and education of the country’s citizens. As a result, according to the World Bank, the literacy rate for both genders is 98%. In addition, many of Costa Rica’s citizens are fluent in Spanish and English. 

• A strategic location that provides access to major international markets

Costa Rica is located between the continents of North and South America, positioning it to serve both markets efficiently. In addition, its thirteen free trade agreements provide products manufactured in Costa Rica with duty-free entry into many countries. Among countries with which Costa Rica has free trade agreements are the United States, Canada, the EU, China, Mexico, South Korea, Chile, Colombia, and several others.

• Quality of Life

Costa Rica is widely recognized as one of the premier tourist destinations in the Western Hemisphere. Its beautiful landscapes and friendly people are an attractive draw that makes locating foreign companies in Costa Rica attractive.

• Eco-sustainability

Costa Rica is known for its environmental sustainability due to its biodiversity. The country has over 500,000 different species of plants and animals and ecosystems, including rainforests and cloud forests characterized by a consistent low-level cover.

Of the new investments of foreign companies in Costa Rica, 11 correspond to non-traditional market representative companies in the areas of services (5), manufacturing (3), tourism infrastructure (2), and life sciences (1).

Costa Rica received 101 FDI projects in 2022, of which 61 responded to reinvestments or expansions.

FDI numbers for foreign companies in Costa Rica

Costa Rica currently has 402 multinational companies that employ 182,200 Costa Ricans in the service, manufacturing, and life sciences sectors.

From 2017 to 2022, the number of new projects entering the country for the first time doubled, from twenty to forty.

On the other hand, there was a reduction of 10 reinvestments in 2022 compared to the numbers in 2021. So it went from 71 to 61.

“We had fewer reinvestment projects than in 2021 since that year was post-pandemic, and there was a rebound effect of many projects that had been paralyzed and, through this effect, they were completed in 2022,” explained Jorge Sequeira, CEO of Cinde.

Outside the San Jose Greater Metropolitan Area (GAM), ten new companies that are active in tourism infrastructure (4), manufacturing (3), services (2), and life sciences (1) sectors were established. Liberia, Santa Cruz, San Carlos, Orotina, Grecia, Cóbano, and Pérez Zeledón are the areas that received these investments outside the GAM.

“We have to seek immediate employment solutions that these populations, including thinking about agriculture and other efforts that have already been made and investment projects outside the GAM zone,” said Manuel Tovar, Costa Rica’s Minister of Foreign Trade.

According to Cinde’s employment estimates, the 101 FDI projects generated 22,000 jobs, of which 900 are outside the GAM.

“Foreign direct investment is a development engine for Costa Rica that generates many jobs and a wealth of benefits for the country,” said Eric Scharf, president of Cinde.

Source: El Financiero