Approximately three decades ago, Costa Rica’s trade policy experienced a significant change by adopting an export based system as its new development model. The diversification of its export offer, the opening of new markets and the attraction of foreign direct investment have set the pace for its development model.
Costa Rican foreign trade is based on four pillars: the multilateral trade system as active member of the World Trade Organization(WTO), the Central American Economic Integration System (SIECA), bilateral free trade agreements and the so called, bilateral investment agreements. It is under these platforms that a small country like Costa Rica has succesfully managed to become an active member of the the global economy.
Under the bilateral framework, Costa Rica has successfuly negotiated free trade agreements with Mexico, Panama, the Dominican Republic, Chile, the Caribbean States Community (CARICOM), the United States-Central America-Dominican Republic (DR-CAFTA), and the People’s Republic of China. Additionally, Costa Rica has succesfully concluded a free trade agreement with Singapur and an Association Agreement with the European Union with the rest of the Central American countries. The latter agreements have yet to enter into force.
With regards to foreign direct investment, Costa Rica has concluded 14 bilateral investment agreements, five of them with EU Member States such as: Spain, France, the Czech Republic, the Netherlands and Germany.
In global terms, in 2011, Costa Rican exports accounted to US$15 379 million, reaching a historic high in exports of goods for an amount of US$10 361 million, an increase of 11% with regards to 2010. Furthermore, exports in services increased from US$4330 million in 2010 to US$5018 million in 2011.
The European Union, as a whole, is Costa Rica’s second largest trade partner accounting for 18.2% of total trade with an equivalent to US$1884.5 million. The United States is Costa Rica’s main trade partner where 38.6% of its total exports were destined for an amount of US$3998.9 million.
In terms of foreign direct investment, during 2010 the European Union was the country’s second largest investor behind the United States, with a total of 12% of all direct investment in Costa Rica for an amount of US$138.3 million.