#San Jose #Costa Rica #PROCOMER #Foreign Direct Investment

Historic Surge in Foreign Direct Investment in Costa Rica

In an impressive display of economic resilience, Costa Rica achieved a remarkable total of $4,321 million in foreign direct investment (FDI) flows in 2024, marking a substantial 14% increase compared to the previous year. This surge not only surpasses the targets outlined in the National Development and Public Investment Plan (PNDIP) by an impressive 37%, but it also highlights the successful attraction of 61 new projects that are set to bolster various sectors of the Costa Rican economy.

Among these, 16 projects strategically chose to set up operations outside the Greater Metropolitan Area (GAM), generating an impressive $240 million in investment for those regions, hence showcasing a commitment to disperse economic growth throughout the country. Notably, 22 of the new initiatives originated from countries beyond the United States, indicating a growing international confidence in Costa Rica as a viable investment destination.

Economic Insights and Impact on Employment

Celebrating this significant turnaround, Indiana Trejos, the Acting Minister of Foreign Trade, emphasized, "Costa Rica's economy is witnessing strong momentum driven mainly by trade and foreign direct investments. We have consistently been the fastest-growing OECD country for the last two consecutive years. Our recent growth can be attributed substantially to exports."

Adding to these insights, Laura López, the General Manager of PROCOMER, expressed pride in these achievements, stating, “The effectiveness of our renewed FDI attraction strategy is evident. Over $200 million has flowed into regions outside the GAM, creating new jobs linked with exports and supporting over 700,000 people.” This demonstrates how strategic investments can lead to widespread employment benefits, contributing significantly to the nation's development.

Investment Breakdown by Sector

Drilling down into the specifics, the Free Trade Zone remains the leading destination for FDI, capturing approximately 64.3% of the total investment, followed closely by the tourism sector with 13.9%, and other areas like real estate (6.8%), financial services (2.4%), and inward processing (0.5%). Of particular note is the 24% increase in investments within the Free Trade Zone compared to 2023, translating into an influx of $531.6 million.

Transitioning to the broader economic landscape, the revival of investment in regions outside the GAM is exemplified by the jump from a negative investment standing of $38.2 million to the aforementioned $240 million. Such growth aligns well with the goals of PROCOMER to promote regional economic development and diversification.

In terms of tourism-related investments, a remarkable 113% increase was recorded, amounting to $318.6 million, which signifies a pivotal moment as the nation aims to bolster its attractiveness as a tourism hub.

Export Performance and Future Projections

Complementing this growth in FDI is a notable upswing in exports. According to data from PROCOMER and the Central Bank of Costa Rica (BCCR), total exports of goods and services reached $30.555 billion in 2024, reflecting an 8% increase compared to 2023. Of this, goods exports totaled approximately $19.894 billion (+9%), powered by precision and medical equipment, which alone surged by 14% (+$1.091 billion), solidifying its status as Costa Rica's leading export sector.

Additionally, the agricultural sector demonstrated robust growth, with an 18% share of total exports, increasing by 7% (+$227 million). Similarly, the services sector saw significant gains, with business services constituting 42% of the country’s exports.

In conclusion, Costa Rica stands at a vital crossroads, with substantial foreign direct investment signaling robust future growth. The government remains committed to fostering a business-friendly environment and ensuring that the benefits of economic activities are widely distributed, proving that strategic investments can pave the way for a prosperous future.