Costa Rica’s leadership in telecommunications and IT initiatives has fueled a steady rise in e-commerce adoption. There is great potential for Costa Rica to increase its use of the internet and e-commerce as well as the 4G structure. The country already enjoys over 170 percent cell-phone penetration, a high level of educational attainment (99 percent literacy rate), and a tradition of political stability.
E-commerce has excellent potential in Costa Rica. “Black Friday” in Costa Rica began in 2010, which is a tradition that brings thousands of buyers to take advantage of discounts on the day and purchase online from U.S. retailers. E-commerce has spurred the creation of companies where consumers can purchase merchandise from U.S. retailers and transport it to the local market. Delivery times may vary depending on the merchandise and all products imported are subject to local import duties and the local custom regulations on labelling and registration if applicable. E-commerce within the country is an unexploited opportunity since customers still prefer to purchase directly at retail locations.
A trend in e-purchases is buying from wish.com, a Chinese website offering low prices and sent directly to Cost Rican households. The Costa Rican Postal Service (Correos de Costa Rica) has opened a new office to deal with a backlog of deliveries due to the overwhelming number of orders received from Asia.
In 2018, Amazon started shipping directly to Costa Rica, which has provided Costa Ricans a platform to bypass the traditional Miami-based PO Box services, saving them money and time. The country passed legislation on August 23, 2005, for the use of digital signatures and certificates, in 2014 the Ministry of Economy gave an official guideline to “massive use and implementation of the digital signature in the public sector.” By the end of 2023, the Digital Governance Directorate and Digital Signature Certifiers (part of MICITT) report that more than 60 government institutions currently utilize the Certified Digital Signature. This widespread adoption has made over 100 government procedures and services accessible to citizens through this digital tool.
The CAFTA-related Intellectual Property Rights law has improved the enforcement of Internet-related works. However, recent studies have indicated that Internet access still lags in rural areas. The local market is dominated by two suppliers: ICE (Instituto Costarricense de Electricidad: the government-owned electricity and telecommunications company) as the main Internet service provider (ISP) and U.S.-owned Liberty Latin America.
Access to the Internet was enhanced by the adoption of mobile devices. According to Costa Rica’s Superintendence of Telecommunications (Sutel), internet penetration exceeded 150 percent by the end of 2021.
According to the Sutel there are an estimated 474,000 subscriptions of (land) Internet services in Costa Rica, representing only about 10.4 percent of the total population.
In 2019, two major events occurred; Liberty Latin America bought Cabletica and increased the internet speeds which created real competition with other internet providers, putting the average cost of a 35 Mbps connection at roughly US$40 per month. The second interesting event is related to the government using the Telecom social funds to give free internet in many parks all over Costa Rica.
In 2021, SUTEL and other local authorities approved U.S.-based Liberty Latin America’s acquisition of Movistar wireless phone operation in Costa Rica, becoming the first U.S. carrier in the market that also offers cable and internet services. In 2022, the company completed the merger of all three brands, which now operate under the Liberty name.
The private sector continues to increase its use of e-commerce in Costa Rica. Local companies commonly have the capability to offer services via the Internet in addition to the usual sales channels. The Costa Rican public and private banks offer their clients a variety of services through the internet. There are several websites specializing in marketing products and services via the internet that have emerged. As well as consumer trading sites, including Mercado Libre, a subsidiary of eBay, Clasificados, Rematico.com, Craig’s List Costa Rica and Locompreaqui.com. The Costa Rican government invested in the new system SICOP (former Mer-Link), an e-bidding website, developed by the South Korean Government which is now part of another system. U.S. company Apple opened an Apple Store in Costa Rica, and there are video streaming services like Netflix on-demand video store, Amazon Prime, Apple TV, HBO Max and others available to Costa Rican consumers.
Digital Economy
Costa Rica’s economy has evolved significantly from its agricultural roots to a modern, service-based model. The country’s long-standing democratic stability, highly educated workforce, and strategic commitment to environmental sustainability have created a favorable environment for foreign direct investment (FDI). The country’s digital transformation began with the arrival of Intel in 1997, which established a semiconductor assembly and testing facility at that time. These moves not only boosted Costa Rica’s economy but also solidified its reputation as a hub for high-tech manufacturing and IT services in Latin America, demonstrating its capacity for complex technological industries.
From the U.S. perspective, Costa Rica is a key economic and security partner in the Western Hemisphere. The United States is its largest trade and investment partner, with U.S. companies accounting for the majority of FDI into Costa Rica. The country’s digital landscape is characterized by an open online environment, high internet penetration (92.5% penetration rate in 2024), and expanding fiber-optic infrastructure.
Market Challenges
The 5G Battleground
A key point of competition is the development of 5G networks. Costa Rica’s government has excluded Chinese vendors, such as Huawei, from its 5G spectrum auctions through a decree that required all companies bidding for 5G contracts to be from countries that have signed the Budapest Convention on Cybercrime. This decision, citing national security risks and alignment with the United States and its allies on cybersecurity, is a significant win for U.S. digital diplomacy in the region.
China’s Role
While China has expressed disapproval of its exclusion from 5G development, its overall investment in Costa Rica’s “new infrastructure” is relatively small compared to its investments in other parts of Latin America. China’s presence is more focused on surveillance technology and consumer electronics, but it lacks the large-scale, traditional infrastructure projects that have been the most important part of its Belt and Road Initiative elsewhere.
Digital Trade Opportunities
FDI Magnet
The country has had remarkable success attracting high-tech investments, particularly in semiconductors, advanced manufacturing, and life sciences. This is a direct result of its skilled labor force, English-language proficiency, and free trade zone incentives.
Government Initiatives
The Costa Rican government is actively working to modernize and digitalize its public sector, with initiatives like “Hacienda Digital” aimed at improving tax and customs services. The World Bank notes the successful implementation of its Unique Digital Health Record, which is a key part of modernizing the health sector.
A Digital Payment Leader
Costa Rica has become a leader in digital payments in Latin America thanks to SINPE Móvil, a popular instant payment system operated by the Central Bank of Costa Rica (BCCR). The system allows users to send and receive money instantly using a mobile phone number, making transactions simple, fast, and secure. It has significantly reduced cash usage, fostered greater financial inclusion, and empowered small businesses and freelancers to grow their businesses in country.
Bilateral Cooperation
The United States and Costa Rica have a strong strategic alliance on digital issues. A joint statement in 2024 affirmed a commitment to foster open, reliable, and secure digital infrastructure. The United States has provided millions in cybersecurity assistance to help Costa Rica defend against cyber threats, following a large-scale ransomware campaign launched by the Russia-linked hacking group known as Conti, in April 2022. This cooperation is intended to reinforce shared values and maintain a competitive, innovative-friendly ecosystem.
The future of Costa Rica’s digital economy is closely tied to its strategic position in the geopolitical rivalry between the United States and China. The United States views Costa Rica as a critical partner in its efforts to secure supply chains and reduce dependence on China for high-tech components.
Securing Supply Chains
The United States is actively helping Costa Rica to become a technological power, particularly in the semiconductor industry. This is part of a broader strategy to bring production closer to home and leverage Costa Rica’s skilled labor force and political stability.