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A recent study by the Miami Herald rated Costa
Rica the 27th safest country for investment of 140 countries
surveyed. If you are not impressed by Costa Rica's ranking,
consider that the United States was ranked only 22nd. Another
recent study found Costa Rica to be the least corrupt country
in Latin America.
In addition, U.S. business magazine Fortune ranked
San José Latin America's fifth best city in
which to do business and placed it within the 25 best
cities in the world. According to the report, Fortune
considered the city's ability to create opportunity
for its residents, its business climate and how well
it can satisfy the business needs of companies that
invest here. San José ranked tops in the quality
of its labor force, its business environment and the
lifestyle it offers resident executives and investors.
Let us review a few of the reasons why Costa Rica
has such magnetism for qualified foreign investors.
First, and perhaps most important, is the enduring
political stability. As you already know, Costa Rica
has had a strong, democratic government without interruption
since the 1940s and an excellent centralized banking
system. The trend towards an open economy and possible
trade pacts with such nations as the United States
and Mexico are conducive to investment in Costa Rica.
Privatization of many state-run institutions will undoubtedly
help economic growth in the future. There are also
no government expropriations or interference, unlike
in many Latin American countries.
Costa Rica is easily accessible from all parts of
the world by land, sea or air. Outstanding phone and
Internet systems link Costa Rica internationally to
other parts of the world. Also, let's remember that
investors in Costa Rica have equal rights and laws
to protect them. Regulations for conducting business
in Costa Rica are the same for both local and foreign
corporations. Both can fully own and control local
corporations, as well as real estate without any access
limitations or restrictions. Many opportunities await
foreigners who start new businesses previously nonexistent
in Costa Rica. In addition, the cost of labor is low.
Additional reasons for investing in Costa Rica are:
asset protection (creditors, judgments, liens, bankruptcy
and divorce), privacy from individuals and governments
and fewer taxes (income tax, inheritance tax, estate
taxes and probate fees).
Many attractive incentives are available to foreigners
investing in Costa Rica. Investments of $50,000 or
more in an approved project qualify the investor for
legal residency. However, it is not necessary to become
a resident to own or manage a business. Anyone who
owns a business can import some items used to operate
it and get a tax break on some of the usual duties.
Contact the incentive section of the Costa Rican Tourism
Institute (ICT) for more information about incentive
programs.
Tourism is now the leading industry in Costa Rica.
Numerous opportunities exist in this field. However,
sometimes there can be a lot of red tape and competition.
Small hotels and bread-and-breakfasts were good investments
a few years ago, but there may be a surplus of them
now. We have a good friend who refurbished an old building
and turned it into a small hotel in 1990. He has done
very well only because he has been in the country for
a while, knows all the ropes, and was a pioneer in
the field.
Foreigners can invest with Costa Rica's nationalized banking
system or private banks. Interest rates are higher than in
the United States (22 percent or even higher in colones and
over 5.75 percent in dollars) and there are many attractive
savings accounts and time deposit programs from which to choose.
Presently there is no tax on interest from bank accounts.
However, when investing in colón accounts, you
have to figure in yearly inflation to see if you are really
getting a good deal. There are some degrees of bank secrecy,
liberal money transfer regulations, and favorable tax laws
for foreigners (see the section in this Chapter 3 entitled
Taxes).
Foreigners can also invest in the local stock exchange
(Bolsa Nacional de Valores) to get better returns
than from traditional financial systems. The stock
market presents a safe investment alternative with
great opportunities for the investment to grow through
stock appreciation, dividends, stock splits, mergers
and acquisitions.
Costa Rica has the largest stock exchange in Central America.
Approximately 29 firms or puestos de bolsa are registered
with the National Stock Exchange. Costa Rican stockbrokers
can study economic trends and give you advice on investing
in government bonds, real estate, time deposits and other
investments. The Costa Rican Stock Exchange is regulated by
the National Securities Commission or Superintendencia
Nacional de Valores de Costa Rica (SUGEVAL), which is
the counterpart of the U.S. Securities and Exchange Commission.
They can give you information about the reliability of firms
and brokers. There exists a strong possibility that the local
exchange will be linked with other Latin American trade blocks
in the very near future. For more information about the Costa
Rican stock market, contact Grupo Busátil Aldesa at
1-888-5-ALDESA (United States only) or 2231022, or E-mail:
grupo@aldesa.com. Investors can find additional information
about the local stock market at http://www.capitales.com.
You may also invest profitably in blue-chip, offshore
mutual funds. Most people do this to protect their
assets from creditors, judgments, liens, bankruptcy,
malpractice claims, divorce and separation claims,
liability claims not covered by insurance and seizure
by the U.S. government.
AmCham's Guide to Investing and Doing Business
in Costa Rica is another source of information
for the potential investor. It is available through
the Costa Rican-American Chamber of Commerce, or
AMCHAM. The Chamber of Commerce also publishes a
monthly magazine entitled Business in Costa Rica
that has advice on how to invest in Costa Rica. You
may also want to attend a meeting of the Investors
Club of Costa Rica. For information, call 240-2240
or 2225601. This is a good way to meet people with
common interests.
RELOCATION, INVESTMENT and RETIREMENT CONSULTANTS is a firm we highly recommend
to any newcomer or potential investor. Its consultants
have many years of experience, will steer you in the
right direction and will save you a lot of headaches
and money. Their expertise, network of reliable contacts
and insider information have already helped hundreds
of people find success, prosperity and happiness in
Costa Rica. Most important, they can show you how to
really make money in Costa Rica by hooking you up with
time-tested investments. You may contact them at Tel/Fax:
011-(506)-261-8968 or through: E-mail: crbooks@racsa.co.cr.
Before investing or starting a business, you should take the time to do your
homework. Under no circumstances should you invest
right off the plane, that is to say, on your first
trip to Costa Rica. Unscrupulous individuals and scamsters
will always prey on impulsive buyers anywhere in the
world. Be wary of any salesmen who try to pressure
you into investing. Remember, it is hard to start a
business in your own home country; don't imagine it
will be any easier in Costa Rica, where both language
and customs are different. The Better Business Bureau
of Costa Rica will help you find reliable businesses
and services.
We also suggest you ask a lot of questions and get information and assistance
from any of the organizations listed below in order
to thoroughly understand the business climate of the
country. However, don't solely depend on the help of
these organizations. You'll have to garner a lot of
information and learn on your own by some trial and
error. This way you can find out what works best for
your particular situation.
Costa Rican-American Chamber of Commerce of Costa Rica: (AMCHAM)
Address in Costa Rica: P.O.Box 4946-1000San José, Costa Rica Address
in United States: Amcham SJO 1576 P.O.Box 025216Miami,
FL 33102-5216 Tel: 220-2200 Fax: 220-233-0969
E-mail: chamber@amcham.co.cr
Coalition for Investment Initiatives-(CINDE)
P.O. Box 7170San José, Costa Rica Tel: 220-0036 Fax: 220-4750
E-mail: aheilbron@cinde.or.cr
Export Promotion Center (CENPRO)
P.O. Box 5418San José, Costa Rica Tel: 0i1-(506) 220-0066 Fax: 011-(506)
223-5722
The Costa Rican Stock Exchange (Bolsa de Valores) Bolsa Nacional de
Valores
P.O. Box 1756San José, Costa Rica Tel: 222-8011 Fax: 255-0531
National Securities Commission
P.O. Box 10058San José, Costa Rica Tel: 233-2840; Fax: 233-0969
Canada Costa Rica Chamber of Commerce
Tel: 257-4466
Investment Opportunities
According to Risk - Finding
Work - Starting a Bussines
- Common Bussines Sense
- Beware of the So Called Experts
and Overnight Gurus - Would
you Buy Real Estate from a Tourist - The
Best Ways to Make Money in Costa Rica - Common
Spanish Bussines Lingo
- Investment in Costa Rica |
