THE GEOGRAPHY (Foreign Office UK)
Area: 51,032 sq km; 19,652 sq miles
Population: 3.8 million
Capital City: San JosT (1.0 million)
People: Only 1% of the population of
Costa Rica is of indigenous extraction.
Costa RicaÆs character is rooted in
distinct local cultures, from the
Afro-Caribbean province of Limon,
with its Creole cuisine, games and
patois to the traditional Ladino values
embodied by the sabanero (cowboy) of
Guanacaste.
Languages: The official language is
Spanish.
Religion(s): Roman Catholic 74%;
Evangelical Protestant 15%; Others 3%;
None 8%
Currency: Colon
Major Political Parties: Social Christian
Unity Party (PUSC), National
Liberation Party (PLN), Partido Accion
Ciudadana (PAC)
Government: PUSC
GEOGRAPHY
Costa Rica covers 51.060 sq kms and is
bordered by Nicaragua to the north
and Panama to the south-east. To the
east lies the Caribbean Sea with
approximately 200kms of coastline
while to the west lies the Pacific Ocean
with around a 1000 kms of coastline. A
volcanic mountain range extends the
length of the country, splitting it in two
from north to south. The Central
Valley lies in the middle of these
highlands which contain several active
volcanoes. On either side of the range
lie coastal lowlands
THE HISTORY (Foreign Office UK)
April 2002 Abel Pacheco of the
governing Partido Unidad Social
Cristiana (PUSC) beat PLN (Socialist)
candidate by a margin of 58% to 42%.
8 May 2002 inauguration of President
Pacheco
THE ECONOMY (Foreign Office UK)
After two years of high growth in 1998
and 1999, Costa RicaÆs economy
experienced a sharp decline in 2000
and 2001. Both the periods of growth
and decline can, to a large extent, be
attributed to the installation of the Intel
computer chip factory. During the
construction of the plant, and the first
year of production, the economy
received a major boost. However, for
the past two years, the combined
effects of contracting markets for
micro-chips and the closing down of
one of the production lines for
modernising, has resulted in a big sales
decrease. This has been reflected in a
large drop in exports and the
consequent effect on the local
economy. The æIntel effectÆ is now so
significant that economists and the
Banco Central de Costa Rica (BCCR)
often produce statistics æwithÆ and
æwithoutÆ Intel in order to obtain a
more accurate indication of economic
performance. On this basis, the
BCCRÆs figures for real GDP growth
for the last two years and the forecast
for this year (2002) are as follows,
showing the æwithoutÆ Intel effects in
brackets: 2000 û 2.2% (3%), 2001 û
0.3% (2.2%), 2002 û 1.4% (1.6%).
As can be seen from the above figures
the economy is stagnant and barely
keeping pace with the increase in
population. The faltering economy
however is not just attributed to the
æIntelÆ effect. Of equal importance
was the slowdown in the US, Costa
RicaÆs main trading partner, which
accounts for roughly half of the
countryÆs imports and exports. Some
sectors, especially high-tech electronic
components, textiles and agriculture
have been particularly affected. Adding
to the countryÆs deteriorated trade
balance, low international prices for
coffee and bananas and a higher fuel
import bill produced a deficit of
US$1.144 million, about double that of
2000. The effects of the events of 11
September may exacerbate the
situation should it lead to a significant
downturn in the number of tourists
visiting Costa Rica. Figures on this have
not yet fed through.
The worsening economic situation has
resulted in an increase in the
unemployment rate but this has not yet
reached high levels. Inflation rate of
10.9% for 2001 was just below the
revised government target of 11%.
Direct Foreign Investment (DFI), at
US$ 447 million was roughly the same
as 2000 and mainly directed to the
tourism sector. Devaluation of the
Colon against the US$ was 6.5% for
2001, within projected levels.
By far the biggest problem facing the
Costa Rican economy is the high public
sector debt, equivalent to 55.7% of
GDP. Servicing this debt requires about
a third of government revenues and is
a serious drain on resources.
Successive governments have been
unable to resolve this problem which
grows year after year.
Basic Economic Facts
Nominal GDP: 15.9 billion US dollars
(2001)
Nominal GDP per head: 3216 US dollars
(2000)
Annual growth: 0.3% (2001)
Inflation: 10.9% (2001)
Major industries: Electronic
components, bananas, coffee, textiles
and apparel, fruits, jewellery, small
appliances, shrimp
Exports (1999): US 51%, Europe23%,
Central America 11%, Japan 2%
Imports (1999): US 56%, Europe 10%,
Mexico 5%, Central America 5%, Japan
5%, Venezuela 4%
INTERNATIONAL RELATIONS
Costa RicaÆs Relations with Neighbours
Costa Rica has an uneasy relationship
with their northern neighbour
Nicaragua, due mainly to the large
number of Nicaraguans resident in
Costa Rica (mainly illegally). The
relationship is particularly strained at
present due to a territorial dispute
over the rights to free navigation of
the San Juan River and in particular,
the rights of Costa Rican patrols to
carry arms. On learning that the Costa
Ricans had created a $1 million reserve
in the Foreign MinistryÆs budget for
2002 to meet legal and consultancy
fees connected with the possibility of
submitting their case before the
International Court in the Hague,
former Nicaraguan President, Arnoldo
Aleman, threatened to impose a 35% tax
on imports from Costa Rica in order to
fund NicaraguaÆs defence costs. On 18
October 2001, the National Assembly
æfrozeÆ the legislation and will only
use it should Costa Rica decide to take
their case to the Hague.
Flags Of The World: Republic of Costa Rica
privacy policy
disclaimer
credits
