Costa Rica Republic of Costa Rica Republica de Costa Rica San José Daniel M. Podgorski

1. Costa Rica Republic of Costa Rica Republica de Costa Rica San José Daniel M. Podgorski

2. Terrain Costal plains separated by mountains Mountain range includes several major volcanoes Climate Mild in central highland Tropical and subtropical in coastal plains Area 51,500 sq. km Includes Isla del Coco Population (est. 2007) 4,133,884 inhabitants Density: 80.3 per sq. km Growth rate: 1.413% Net migration rate: .48 migrants/1000 population Government Democratic republic President: Oscar Arias Sanchez General Information

3. Life expectancy 77.21 years Male: 74.61 years Female: 79.94 years Ethnic groups European (including Mestizo) 94% (10-15% Nicaraguan of Mestizo origin) Black 3% Indigenous 1% or less Chinese 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% People

4. GDP (est. 2006) PPP: 48.77 billion Official exchange rate: $20.77 billion Per capita (PPP): 12,000 Per capita (official exchange rate): $5,100 Growth rate: 4.7% Composition 8.6% agriculture 31% industry 60.4% services Inflation rate: 9.43% Unemployment rate: 6.6% Government budget Revenue: 3.134 billion Expenditure: 3.475 billion Balance: -.341 billion Outstanding public debt: 53.4% of GDP CA balance: -1.176 billion Economic Information

5. Trade • Exports • Commodities: bananas, pineapples, coffee, melons, ornamental plants, sugar, textiles, electronic components, medical equipment, possibly electricity in the future • Partners: 42.6% USA, 16.3% EU, 6.9% Hong Kong, 6.4%, 4.2% Guatemala • Imports • Commodities: raw materials, consumer goods, capital equipment, petroleum • Partners: 41.3% US, 13.1% EU, 5.6% Japan, 4.8% Venezuela, 4.8% Mexico, 4.2% Brazil, 4.2% China

6. Free Trade Information • Has sought to widen its economic and trade ties within and outside the Latin American region • Signed free trade agreements with Canada, Chile, the Dominican Republic, Mexico, Trinidad, Tobago (negotiating with Panama) • Looking to begin negotiating a regional Central American-EU free trade agreement in 2007 • Active participant in discussion of setting up the Free Trade Area of the Americas (along with 34 other countries) • Free trade agreement with the Caribbean Community (CARICOM) was approved in 2005 • Dominican Republic - Central American Free Trade Agreement (DR-CAFTA)

7. Fiscal Policy • Large internal and external deficits and large internal debt • Budget balances (% GDP): • -3.1% 2003 • -2.5% 2004 • -1.6% 2005 • -2.6% est. 2006 • -2.6% projected 2007 • Comprehensive tax reform goals resulting in: • Sustained increases in social and capital expenditure • Improved reduction in debt

8. Monetary and ER Policy • Currency: Costa Rican colon (CRC) • Exchange rates (colones per US dollar) • 511.3 (2006), 477.79 (2005), 437.91 (2004), 398.66 (2003), 359.82 (2002) • Central bank recently modified the exchange band • Inflation • Fell below 10% in 2006 • Exchange rate modification should help reduce inflation permanently • Reduction is challenging • Rising import prices • Fiscal deficits

9. Social Policies • Unemployment • 14.2% for those 12-24 and 4.3% for those 25-40 • Reforms aimed to create jobs • Education • Constitution provides for free and compulsory education • Literacy rates exceed 90% • Goal of dedicating 8% of GDP • Social security • Costa Rica Social Security Fund • Voluntary retirement accounts (1996) • Private individual saving mandatory as of 2000

10. Long emphasized democracy and respect of human rights Permanent neutrality (1993) Concern over Venezuela’s democratic institutions Nicaragua Helped end civil war during Arias first term in office Problems Nicaraguan immigration Heavy demands on social welfare system Rio San Juan US relations Historically close and friendly Supports international views Most important trading partner Private American citizens Issues with expropriation Investment disputes External Relations

11. References • Bladex. (2006). Costa Rica. Retrieved May 20, 2007, from http://www.blx.com/paginasInfoLatam.aspx?PAG_ID=26&CAT_ID=5 • O Country Reports. (2004). Costa Rica. Retrieved May 17, 2007, from http://gpn.org/data/costarica.html • Energy Information Administration. (2006). Central America Regional Factsheet. Retrieved May 16, 2007, from http://www.eia.doe.gov/emeu/cabs/Central_America/Background.html • External Relations. (2006). The EU’s Relations with Costa Rica. Retrieved May 21, 2007, from http://ec.europa.eu/external_relations/costarica/intro/index.htm • Federal Reserve Bank of Atlanta. (2005). The Effect of the Privatization of Pension Plans on Financial and Regulatory Systems in Latin America. Retrieved May 16, 2007, from http://www.frbatlanta.org/filelegacydocs/pensions_whitepaper05.pdf • International Information Programs. (2006). Costa Rica’s Economy Strong, Says International Monetary Fund. Retrieved May 21, 2007 from http://usinfo.state.gov/xarchives/display.html?p=washfile-english&y=2006&m=August&x=200608041048221xeneerg4.751223e-02 • International Monetary Fund. (2007). IMF Staff Statement at the Conclusion of a Visit to Costa Rica. Retrieved May 20, 2007 from http://www.imf.org/external/np/sec/pr/2007/pr0727.htm • South Florida Business Journal. (2003). U.S. works on CAFTA, without Costa Rica. Retrieved May 18, 2007, from http://southflorida.bizjournals.com/southflorida/stories/2003/12/15/daily44.html • The World Bank. (2006). Costa Rica Country Brief. Retrieved May 16, 2007, from http://go.worldbank.org/KO0ABHBMH0 • The World Factbook. (2007). Costa Rica. Retrieved May 16, 2007, from http://www.cia.gov/library/publications/the-world-factbook/geos/cs.html • U.S. Department of State. (2007). Background Note: Costa Rica. Retrieved May 16, 2007, from http://www.state.gov/r/pa/ei/bgn/2019.htm