Costa Rica

 

Bureau of Western Hemisphere Affairs                                          
July 2007                                                                     
                                                                       
  Background Note: Costa Rica                                                 
                                            
  Swimming in river near San Carlos,                                          
  Costa Rica, April 11, 2006. [© AP                                           
  Images]                                                                     
                                                                       
  Flag of Costa Rica is five horizontal bands of blue (top), white, red (double
  width), white, and blue, with the coat of arms in a white elliptical disk on
  the hoist side of the red band; above the coat of arms a light blue ribbon  
  contains the words, AMERICA CENTRAL, and just below it near the top of the  
  coat of arms is a white ribbon with the words, REPUBLICA COSTA RICA.        
                                                                       
  PROFILE                                                                     
                                                                       
  OFFICIAL NAME:                                                              
  Republic of Costa Rica                                                      
                                                                       
  Geography                                                                   
  Area: 51,100 sq. km (19,730 sq. mi.) about the size of the states of Vermont
  and New Hampshire combined.                                                 
  Cities: Capital--San Jose (greater metropolitan area pop. 2.1 million, the  
  greater metropolitan area as defined by the Ministry of Planning and Economic
  Policy includes the cities of Alajuela, Cartago, and Heredia). Other major  
  cities outside the San Jose capital area--Puntarenas, Limon, and Liberia.   
  Terrain: A rugged, central range separates the eastern and western coastal  
  plains.                                                                     
  Climate: Mild in the central highlands, tropical and subtropical in coastal 
  areas.                                                                      
                                                                       
  People                                                                      
  Nationality: Noun and adjective--Costa Rican(s).                            
  Population (2007 est.): 4.13 million.                                       
  Annual growth rate (2007 est.): 1.41%.                                      
  Ethnic groups: European and some mestizo 94%, African origin 3%, Chinese 1%,
  Amerindian 1%, other 1%.                                                    
  Religion: Roman Catholic 76.3%, Evangelical 13.7%, Jehovah's Witnesses 1.3%,
  other Protestant 0.7%, other 4.8%, none 3.2%.                               
  Languages: Spanish, with a southwestern Caribbean Creole dialect of English 
  spoken around the Limon area.                                               
  Education: Years compulsory--9. Attendance--99% grades 1-6, 71% grades 7-9. 
  Literacy--96%.                                                              
  Health: Infant mortality rate--9.45/1,000. Life expectancy--men 74.61 yrs., 
  women 79.94 yrs.                                                            
  Work force (2006 est., 1.866 million; this official estimate excludes       
  Nicaraguans living in Costa Rica legally and illegally): Agriculture--13%;  
  industry--22%; services--64%.                                               
                                                                       
  Government                                                                  
  Type: Democratic republic.                                                  
  Independence: September 15, 1821.                                           
  Constitution: November 7, 1949.                                             
  Branches: Executive--president (head of government and chief of state)      
  elected for one 4-year term, two vice presidents, Cabinet (15 ministers, two
  of whom are also vice presidents). Legislative--57-deputy unicameral        
  Legislative Assembly elected at 4-year intervals. Judicial--Supreme Court of
  Justice (22 magistrates elected by Legislative Assembly for renewable 8-year
  terms). The offices of the Ombudsman, Comptroller General, and Procurator   
  General assert autonomous oversight of the government.                      
  Subdivisions: Seven provinces, divided into 81 cantons, subdivided into 421 
  districts.                                                                  
  Political parties: National Liberation Party (PLN), Citizen's Action Party  
  (PAC), Libertarian Movement Party (PML), Social Christian Unity Party (PUSC),
  and other smaller parties.                                                  
  Suffrage: Universal and compulsory at age 18.                               
                                                                       
  Economy                                                                     
  GDP (2006): $20.77 billion.                                                 
  GDP PPP (2006 est.): $48.77 billion.                                        
  Inflation (2006 est.): 9.43%.                                               
  Real growth rate (2006 est.): 4.7%.                                         
  Per capita income (2006): $5,100. (PPP $12,000, 2006 est.)                  
  Unemployment (2006 est.): 6.6%.                                             
  Currency: Costa Rica Colon (CRC).                                           
  Natural resources: Hydroelectric power, forest products, fisheries products.
  Agriculture (8.6% of GDP): Products--bananas, pineapples, coffee, beef,     
  sugar, rice, dairy products, vegetables, fruits and ornamental plants.      
  Industry (31% of GDP): Types--electronic components, food processing,       
  textiles and apparel, construction materials, fertilizer, medical equipment.
  Commerce, tourism, and services (60.4% of GDP): Hotels, restaurants, tourist
  services, banks, and insurance.                                             
  Trade (2006 est.): Exports--$7.931 billion: bananas, pineapples, coffee,    
  melons, ornamental plants, sugar, textiles, electronic components, medical  
  equipment. Major markets--U.S. 42.6%, Hong Kong 6.9%, Netherlands 6.4%,     
  Guatemala 4.2%. Imports--$10.88 billion: raw materials, consumer goods,     
  capital equipment, petroleum. Major suppliers--U.S. 41.3%, Japan 5.6%,      
  Venezuela 4.8%, Mexico 4.8%, Ireland 4.3%, Brazil 4.2%, China 4.2%.         
                                                                       
  PEOPLE                                                                      
  Unlike many of their Central American neighbors, present-day Costa Ricans are
  largely of European rather than mestizo descent; Spain was the primary      
  country of origin. However, an estimated 10% to 15% of the population is    
  Nicaraguan, of fairly recent arrival and primarily of mestizo origin.       
  Descendants of 19th-century Jamaican immigrant workers constitute an        
  English-speaking minority and--at 3% of the population--number about 119,000.
  Few of the native Indians survived European contact; the indigenous         
  population today numbers about 29,000 or less than 1% of the population.    
                                                                       
  HISTORY                                                                     
  In 1502, on his fourth and last voyage to the New World, Christopher Columbus
  made the first European landfall in the area. Settlement of Costa Rica began
  in 1522. For nearly three centuries, Spain administered the region as part of
  the Captaincy General of Guatemala under a military governor. The Spanish   
  optimistically called the country "Rich Coast." Finding little gold or other
  valuable minerals in Costa Rica, however, the Spanish turned to agriculture.
                                                                       
  The small landowners' relative poverty, the lack of a large indigenous labor
  force, the population's ethnic and linguistic homogeneity, and Costa Rica's 
  isolation from the Spanish colonial centers in Mexico and the Andes all     
  contributed to the development of an autonomous and individualistic agrarian
  society. An egalitarian tradition also arose. This tradition survived the   
  widened class distinctions brought on by the 19th-century introduction of   
  banana and coffee cultivation and consequent accumulations of local wealth. 
                                                                       
  Costa Rica joined other Central American provinces in 1821 in a joint       
  declaration of independence from Spain. Although the newly independent      
  provinces formed a Federation, border disputes broke out among them, adding 
  to the region's turbulent history and conditions. Costa Rica's northern     
  Guanacaste Province was annexed from Nicaragua in one such regional dispute.
  In 1838, long after the Central American Federation ceased to function in   
  practice, Costa Rica formally withdrew and proclaimed itself sovereign.     
                                                                       
  An era of peaceful democracy in Costa Rica began in 1899 with elections     
  considered the first truly free and honest ones in the country's history.   
  This began a trend continued until today with only two lapses: in 1917-19,  
  Federico Tinoco ruled as a dictator, and, in 1948, Jose Figueres led an armed
  uprising in the wake of a disputed presidential election.                   
                                                                       
  With more than 2,000 dead, the 44-day civil war resulting from this uprising
  was the bloodiest event in 20th-century Costa Rican history, but the        
  victorious junta drafted a constitution guaranteeing free elections with    
  universal suffrage and the abolition of the military. Figueres became a     
  national hero, winning the first election under the new constitution in 1953.
  Since then, Costa Rica has held 14 presidential elections, the latest in    
  2006.                                                                       
                                                                       
  GOVERNMENT                                                                  
  Costa Rica is a democratic republic with a very strong system of            
  constitutional checks and balances. Executive responsibilities are vested in
  a president, who is the country's center of power. There also are two vice  
  presidents and a 15-member cabinet. The president and 57 Legislative Assembly
  deputies are elected for 4-year terms. In April 2003, the Costa Rican       
  Constitutional Court annulled a 1969 constitutional reform which had barred 
  presidents from running for reelection. As a result, the law reverted back to
  the 1949 Constitution, which permits ex-presidents to run for reelection    
  after they have been out of office for two presidential terms, or eight     
  years. Deputies may run for reelection after sitting out one term, or four  
  years. In the third quarter of 2007, the country is scheduled to hold its   
  first national referendum, on the U.S.-Central American-Dominican Republic  
  Free Trade Agreement (CAFTA-DR).                                            
                                                                       
  The electoral process is supervised by an independent Supreme Electoral     
  Tribunal--a commission of three principal magistrates and six alternates    
  selected by the Supreme Court of Justice. Judicial power is exercised by the
  Supreme Court of Justice, composed of 22 magistrates selected for renewable 
  8-year terms by the Legislative Assembly, and subsidiary courts. A          
  Constitutional Chamber of the Supreme Court (Sala IV), established in 1989, 
  reviews the constitutionality of legislation and executive decrees and all  
  habeas corpus warrants.                                                     
                                                                       
  The offices of the Comptroller General of the Republic, the Solicitor       
  General, and the Ombudsman exercise oversight of the government. The        
  Comptroller General's office has a statutory responsibility to scrutinize all
  but the smallest public sector contracts and strictly enforces procedural   
  requirements. With the Sala IV, these institutions are playing an           
  increasingly prominent role in governing Costa Rica.                        
                                                                       
  There are provincial boundaries for administrative purposes, but no elected 
  provincial officials. Costa Rica held its first mayoral elections in December
  2002, whereby mayors were elected to 4-year terms by popular vote through   
  general elections. Prior to 2002, the office of mayor did not exist, and the
  president of each municipal council was responsible for the administration of
  his/her municipality. Autonomous state agencies enjoy considerable          
  operational independence; they include the telecommunications and electrical
  power monopoly, the state petroleum refinery, the nationalized commercial   
  banks, the state insurance monopoly, and the social security agency. Costa  
  Rica has no military and maintains only domestic police and security forces.
  A professional Coast Guard was established in 2000.                         
                                                                       
  Principal Government Officials                                              
  President--Oscar ARIAS Sanchez                                              
  Foreign Minister--Bruno STAGNO Ugarte                                       
  Ambassador to the United States--Tomás DUEÑAS                               
  Ambassador to the Organization of American States--Javier SANCHO Bonilla    
  Ambassador to the United Nations-- Jorge URBINA                             
                                                                       
  Costa Rica maintains an embassy in the United States at 2114 S Street NW,   
  Washington, DC 20008 (tel. 202-234-2945 and 202-234-2946).                  
                                                                       
  POLITICAL CONDITIONS                                                        
  Costa Rica has long emphasized the development of democracy and respect for 
  human rights. The country's political system has steadily developed,        
  maintaining democratic institutions and an orderly, constitutional scheme for
  government succession. Several factors have contributed to this trend,      
  including enlightened leadership, comparative prosperity, flexible class    
  lines, educational opportunities that have created a stable middle class, and
  high social indicators. Also, because Costa Rica has no armed forces, it has
  avoided military involvement in political affairs, unlike other countries in
  the region.                                                                 
                                                                       
  In May 2006, President Oscar Arias of the National Liberation Party (PLN)   
  assumed office, defeating principal rival Ottón Solis of the Civil Action   
  Party by roughly 2% of the vote. Arias has listed passage of the CAFTA-DR,  
  along with fiscal reform, infrastructure improvements, improving education, 
  and improving security as primary goals for his presidency. The 57-member   
  unicameral Legislative Assembly has four principal party factions, with the 
  governing party, PLN, having a 25-seat plurality.                           
                                                                       
  ECONOMY                                                                     
  After four years of slow economic growth, the Costa Rican economy grew at   
  nearly 5% in 2006. Compared with its Central American neighbors, Costa Rica 
  has achieved a high standard of living, with a per capita income of about   
  U.S. $5,100, and an unemployment rate of 6.6%. During 2006 the annual       
  inflation rate dropped into the single digits (9.43%) for only the third time
  in the last 28 years; proof that the Costa Rican Government is seriously    
  trying to reduce its large fiscal deficit.                                  
                                                                       
  Implementing CAFTA-DR, passing fiscal reform, and creating an effective     
  concessions process are the biggest challenges for the country's economic   
  policymakers. Costa Rica ranks 105th out of 175 countries in the World Bank's
  2006 Doing Business Index. This hampers the flow of investment and resources
  badly needed to repair and rebuild the country's deteriorated public        
  infrastructure.                                                             
                                                                       
  Costa Rica's major economic resources are its fertile land and frequent     
  rainfall, its well-educated population, and its location in the Central     
  American isthmus, which provides easy access to North and South American    
  markets and direct ocean access to the European and Asian Continents.       
  One-fourth of Costa Rica's land is dedicated to national forests, often     
  adjoining picturesque beaches, which has made the country a popular         
  destination for affluent retirees and eco-tourists.                         
                                                                       
  Costa Rica used to be known principally as a producer of bananas and coffee,
  but pineapples have surpassed coffee as the number two agricultural export. 
  In recent years, Costa Rica has successfully attracted important investments
  by such companies as Intel Corporation, which employs nearly 2,000 people at
  its $300 million microprocessor plant; Proctor and Gamble, which employs    
  nearly 1,000 people in its administrative center for the Western Hemisphere;
  and Hospira and Baxter Healthcare from the health care products industry.   
  Manufacturing and industry's contribution to GDP overtook agriculture over  
  the course of the 1990s, led by foreign investment in Costa Rica's free trade
  zone. Well over half of that investment has come from the United States. Dole
  and Chiquita have a large presence in the banana and pineapple industries.  
  Two-way trade between the U.S. and Costa Rica exceeded $7.9 billion in 2006.
                                                                       
  Costa Rica has oil deposits off its Atlantic Coast, but the Pacheco         
  administration (2002-2006) decided not to develop the deposits for          
  environmental reasons. The country's mountainous terrain and abundant       
  rainfall have permitted the construction of a dozen hydroelectric power     
  plants, making it largely self-sufficient in electricity, but it is         
  completely reliant on imports for liquid fuels. Costa Rica has the potential
  to become a major electricity exporter if plans for new generating plants and
  a regional distribution grid are realized. Mild climate and trade winds make
  neither heating nor cooling necessary, particularly in the highland cities  
  and towns where some 90% of the population lives.                           
                                                                       
  Costa Rica's public infrastructure has suffered from a lack of maintenance  
  and new investment. The country has an extensive road system of more than   
  30,000 kilometers, although much of it is in disrepair. Most parts of the   
  country are accessible by road.                                             
                                                                       
  Costa Rica has sought to widen its economic and trade ties within and outside
  the region. Costa Rica signed a bilateral trade agreement with Mexico in    
  1994, which was later amended to cover a wider range of products. Costa Rica
  joined other Central American countries, plus the Dominican Republic, in    
  establishing a Trade and Investment Council with the United States in March 
  1998. Costa Rica has signed trade agreements with Canada, Chile, the        
  Dominican Republic, Mexico, and Trinidad and Tobago. It is negotiating a    
  trade agreement with Panama and is poised to begin negotiating a regional   
  Central American-EU trade agreement in 2007. Costa Rica was an active       
  participant in the negotiation of the hemispheric Free Trade Area of the    
  Americas and is active in the Cairns Group, which is pursuing global        
  agricultural trade liberalization within the World Trade Organization.      
                                                                       
  Costa Rica concluded negotiations with the U.S. to participate in CAFTA-DR in
  January 2004. The Legislative Assembly began debate in October 2005, but    
  Costa Rica is the only CAFTA-DR partner not to have yet entered the agreement
  into force. Ratification and implementation are pending the 2007 referendum.
  Once implemented, CAFTA would bring about the partial opening of the state  
  telecommunications monopoly and a substantial opening of the state-run      
  insurance sector.                                                           
                                                                       
  FOREIGN RELATIONS                                                           
  Costa Rica is an active member of the international community and, in 1993, 
  proclaimed its permanent neutrality. Its record on the environment, human   
  rights, and advocacy of peaceful settlement of disputes give it a weight in 
  world affairs far beyond its size. The country lobbied aggressively for the 
  establishment of the UN High Commissioner for Human Rights and became the   
  first nation to recognize the jurisdiction of the Inter-American Human Rights
  Court, based in San Jose.                                                   
                                                                       
  During the tumultuous 1980s, then President Oscar Arias authored a regional 
  peace plan in 1987 that served as the basis for the Esquipulas Peace        
  Agreement. Arias' efforts earned him the 1987 Nobel Peace Prize. Subsequent 
  agreements, supported by the United States, led to the Nicaraguan election of
  1990 and the end of civil war in Nicaragua. Costa Rica also hosted several  
  rounds of negotiations between the Salvadoran Government and the Farabundo  
  Marti National Liberation Front (FMLN), aiding El Salvador's efforts to     
  emerge from civil war and culminating in that country's 1994 free and fair  
  elections. Costa Rica has been a strong proponent of regional arms limitation
  agreements. President Arias has spoken out in public for self-determination 
  in Cuba and expressed concern about eroding democratic institutions in      
  Venezuela.                                                                  
                                                                       
  U.S.-COSTA RICAN RELATIONS                                                  
  The United States and Costa Rica have a history of close and friendly       
  relations based on respect for democratic government, human freedoms, free  
  trade, and other shared values. The country generally supports the U.S. in  
  international fora, especially in the areas of democracy and human rights.  
                                                                       
  The United States is Costa Rica's most important trading partner. The U.S.  
  accounts for almost half of Costa Rica's exports, imports, and tourism, and 
  more than two-thirds of its foreign investment. The two countries share     
  growing concerns for the environment and want to preserve Costa Rica's      
  important tropical resources and prevent environmental degradation.         
                                                                       
  The United States responded to Costa Rica's economic needs in the 1980s with
  significant economic and development assistance programs. Through provision 
  of more than $1.1 billion in assistance, the U.S. Agency for International  
  Development (USAID) supported Costa Rican efforts to stabilize its economy  
  and broaden and accelerate economic growth through policy reforms and trade 
  liberalization. Assistance initiatives in the 1990s concentrated on         
  democratic policies, modernizing the administration of justice, and         
  sustainable development. The USAID Mission in Costa Rica closed in 1996, once
  the country had graduated from most forms of U.S. assistance, but USAID     
  completed a $9 million project in 2000-01 to support refugees of Hurricane  
  Mitch residing in Costa Rica.                                               
                                                                       
  For decades, Peace Corps Volunteers have provided technical assistance in the
  areas of environmental education, natural resources, management, small      
  business development, microfinance, basic business education, urban youth,  
  and community education.                                                    
                                                                       
  Between 30,000-50,000 private American citizens, including many retirees,   
  reside in the country and more than 700,000 American citizens visit Costa   
  Rica annually. There have been some vexing issues in the U.S.-Costa Rican   
  relationship, principal among them longstanding expropriation and other U.S.
  citizen investment disputes, which have hurt Costa Rica's investment climate
  and produced some bilateral friction.                                       
                                                                       
  The U.S.-Costa Rica Maritime Cooperation Agreement, the first of its kind in
  Central America, entered into force in late 1999. Since then, the agreement 
  has resulted in a growing number of narcotics seizures, illegal migrant     
  rescues, illegal fishing cases, and search-and-rescue missions. Bilateral   
  Costa Rican law enforcement cooperation, particularly against               
  narcotrafficking, has been exemplary.                                       
                                                                       
  Principal U.S. Embassy Officials                                            
  Ambassador--Mark Langdale                                                   
  Deputy Chief of Mission--David Henifin, Acting                              
  Political Counselor--Dorian Hurtado, Acting                                 
  Economic Officer--Whitney Witteman                                          
  Consul General--David Dreher                                                
  Management Counselor--Scott McAdoo                                          
  Public Affairs Officer--Elaine Samson, Acting                               
  Defense Representative--Chief-Commander Mark Camacho, USCG                  
  Commercial Attaché--James McCarthy                                          
  Agricultural Attaché--Katherine Nishiura                                    
  APHIS--vacant                                                               
  Environmental Hub--Bernard Link                                             
  Regional Security Officer--Kevin Mann, Acting                               
  Drug Enforcement Administration--Paul Knierim                               
  Peace Corps Director--Terry Grumley                                         
                                                                       
  The U.S. Embassy in Costa Rica is located in Pavas at Boulevard Pavas and   
  Calle 120, San Jose, tel. (506) 519-2000 or (506) 220-3127.                 
                                                                       
  Other Contact Information                                                   
  U.S. Department of Commerce                                                 
  Trade Information Center                                                    
  International Trade Administration                                          
  14th and Constitution Avenue, NW                                            
  Washington, DC 20320                                                        
  Tel: 800-USA-TRADE                                                          
  www.trade.gov                                                               
                                                                       
  Costa Rican American Chamber of Commerce                                    
  c/o Aerocasillas                                                            
  P.O. Box 025216, Dept 1576                                                  
  Miami, Florida 33102-5216                                                   
  Tel: 506-22-0-22-00                                                         
  Fax: 506-22-0-23-00                                                         
  Email: Amchamcr@sol.racsa.co.cr                                             
                                                                       
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  For the latest security information, Americans living and traveling abroad  
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  Printing Office, Washington, DC 20402, tel. (202) 512-1800.                 
                                                                       
  Further Electronic Information                                              
  Department of State Web Site. Available on the Internet at http://          
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