Costa Rica: Investing

FDI in Figures

Costa Rica has been consistently attracting FDI inflows during the last few years in the high technology manufacturing and infrastructure sectors. Among many reasons, the establishment of Free Zones as well as The US-Central American Free Trade Agreement have encouraged the inflow of FDI into Costa Rica.

The factors that influence FDI are the tax incentives, an exemplary political and economic stability and a skilled labor force. The Investment Promotion Agency: La Coalición Costarricense de Iniciativas de Desarrollo - CINDE is renown as one of the most efficient agencies in South American in terms of promotion of investments. However, the permanent government interference in controlling certain sectors of the economy, in particular services as well as the complexity of its bureaucratic procedures are major inconveniences. Lastly, Costa Rica is one of the countries considered to be non-cooperative in the fight against capital laundering.

A new sector which is attracting more and more investment is the Eco-tourism thanks to the responsible environmental policy pursued by the government. The main investing countries are the United States (with 50% of FDI in Costa Rica), Canada and Mexico.

Country Comparison For the Protection of Investors

	Costa Rica	Latin America & Caribbean	United States	Germany
Index of Transaction Transparency*	2.0	4.1	7.0	5.0
Index of Manager’s Responsibility**	5.0	5.3	9.0	5.0
Index of Shareholders’ Power***	2.0	6.0	9.0	5.0
Index of Investor Protection****	3.0	5.1	8.3	5.0

Source: Doing Business - Last Available Data.

Note: *The Greater the Index, the More Transparent the Conditions of Transactions. **The Greater the Index, the More the Manager is Personally Responsible. *** The Greater the Index, the Easier it Will Be For Shareholders to Take Legal Action. **** The Greater the Index, the Higher the Level of Investor Protection.

Foreign Direct Investment	2008	2009	2010
FDI Inward Flow (million USD)	2,021	1,347	1,413
FDI Stock (million USD)	10,818.0	12,385.8	13,500.1
Performance Index*, Ranking on 141 Economies	40	39	-
Potential Index**, Ranking on 141 Economies	87	-	-
Number of Greenfield Investments***	19.0	68.0	-
FDI Inwards (in % of GFCF****)	28.1	16.7	-
FDI Stock (in % of GDP)	36.5	41.4	-

Source: UNCTAD - Last Available Data

Note: * The UNCTAD Inward FDI Performance Index is Based on a Ratio of the Country's Share in Global FDI Inflows and its Share in Global GDP. ** The UNCTAD Inward FDI Potential Index is Based on 12 Economic and Structural Variables Such as GDP, Foreign Trade, FDI, Infrastructures, Energy Use, R&D, Education, Country Risk. *** Green Field Investments Are a Form of Foreign Direct Investment Where a Parent Company Starts a New Venture in a Foreign Country By Constructing New Operational Facilities From the Ground Up. **** Gross Fixed Capital Formation (GFCF) Measures the Value of Additions to Fixed Assets Purchased By Business, Government and Households Less Disposals of Fixed Assets Sold Off or Scrapped.

Tax Rates

Sales Tax: 13%
Company Tax: From 10% to 30%
Withholding Taxes: Dividends: 15%, Interests: 15%, Royalties: 25%.
Bilateral Agreement: Costa Rica and Lebanon are not bound by a Double Tax Agreement.
Social Security Contributions Paid By Employers: 26%

Country Comparison For Corporate Taxation

	Costa Rica	Latin America & Caribbean	United States	Germany
Number of Payments of Taxes per Year	42.0	33.2	11.0	16.0
Time Taken For Administrative Formalities (Hours)	272.0	384.7	187.0	215.0
Total Share of Taxes (% of Profit)	55.0	48.0	46.8	48.2

Source: Doing Business - Last Available Data.

Investment Opportunities

Tenders, Projects and Public Procurement: Inter-American Development Bank, Tenders in South America
DgMarket, Tenders Worldwide
Setting Up a Company: Consult Doing Business Website, to know about procedures to start a Business in Costa Rica.
Useful Resources: Costa Rican Investment and Trade Development Board
General Honorary Consulate of Costa Rica in Beirut, Lebanon
Abd-El-Baki Bldg
1st Floor Facing Broadway Center Hamra Street,
Beirut, Lebanon
Phone: 00 (961) 134-34-64 / 00 (961) 134-34-54
Fax: 00 (961) 134-34-54
Contact the embassy by Email
Office Hours: From 9:00 a.m. to 2:00 p.m.

Business Setup Procedures

Setting Up a Company	Costa Rica	Latin America & Caribbean
Procedures (number)	12.00	9.30
Time (days)	60.00	56.70

Source: Doing Business.

Any Comments About This Content? Report It to Us.

Learn more about Investing in Costa Rica on Globaltrade.net, the Directory for International Trade Service Providers.

TERMS & CONDITIONS | SITEMAP | FAQ | VIDEOS | CONTACT