Dubbed as the” Silicon Valley of Latin America” Costa Rica has become in the last five years more appealing due to its investment-friendly climate and government policies on attracting foreign investors. With world-wide economy at a downfall especially the U.S. commercial leaders like, Microsoft, GE, Abbot Laboratories, Continental Airways and Intel Corporation continual to make sizable investments there with their production and distribution facilities. Years ago Western Union chose Costa Rica to host its Latin American regional operations center.
Costa Rica in the last 40 years remains one of the safest and most attractive countries in the whole world. The government, its ministries and banking and lending institutions have always maintained pro-U.S. in regards to financial security and tax laws. This acknowledge aim has spearheaded many high-tech corporations, franchised companies (McDonalds, Outback Steak House, Home Depot and Office Depot) and real estate (REMAX, Century 21) firms to take advantage of Costa Rica’s educated, computer literate, low labor rates, and disciplined workforce. Over 90% of Ricans are literate and it is fairly easy to open a business and work in Costa Rica. With that said, Costa Rica is vastly becoming a modern production infrastructure country. For a country whose economy had always been dependence on coffee, bananas and cattle now is slowly becoming depended on the manufacturing of microprocessor production (ranked 5th in the world), outsourcing, high-tech telecommunications services and the thriving eco-friendly tourism industry. In 2000 Costa Rica earned more from high technology exports than from coffee or bananas. The eco-tourism industry now ranks #4 in their overall GNP.
Back in 2007 Costa Rica narrowly approved joining CAFTA, the Central American Free Trade Agreement brokered by the United States. CAFTA was greatly opposed by the unions and it did come with controversy that the agreement would cause harm to the local workforce. Costa Rica had always been most vocal supporters of continental free trade with trade agreements with Mexico and other countries of Central and South America. With Costa Rica’s free trade zones such benefits as no import duties on raw materials, capital goods, parts and components; unrestricted profit repatriation; tax exemption on profits for eight years and a 50 percent exemption for the following four years are extremely enticing to any business that wants to open shop.
Costa Rica also committed to fully open its insurance market to competition, with the vast majority of the market opening by January 1, 2008, and full opening of the sector by January 1, 2011. the agreement is set up for the Digital Age: State-of-the-art protections and non-discriminatory treatment are provided for digital products such as U.S. software, music, text, and videos. Protections for U.S. patents, trademarks and trade secrets are strengthened.
The World Bank has always given Costa Rica an excellent bill of overall political and economic health. It said, it is [Costa Rica] “one of the most stable and robust” democracies in Latin America. And went on to praise it’s “healthy economic growth rate” and “some of the best social indicators” on any continent.
No doubt, Costa Rica is building a competitive advantage for itself and the many business who have chosen or are pondering the option to operate here. It is a country at a turning point in integrating itself into the modern world economy. Anyone doing business here will have the inside track.