Much of Costa Rica’s basic infrastructure, especially ground transportation and water treatment, needs major upgrading. The country’s significant fiscal deficit places additional limitations on Costa Rica’s ability to finance needed infrastructure projects. Public-private partnerships as well as concessions continue to face numerous legal and procedural challenges that have delayed or, in some cases, canceled major initiatives. Costa Rica’s often slow and cumbersome bureaucracy poses a challenge to doing business throughout the country.
Costa Rica is facing fiscal deficit issues which have the potential to impact the country’s credit rating and necessitate cuts in government expenditures. This represents a challenge in the face of Costa Rica’s need to make further infrastructure investments in ports, rail, roads, and bridges. Other international competitors, primarily from Asia, have repeatedly approached Costa Rican authorities with attractive financing options for specific infrastructure improvements.
Costa Rica boasts that, on average, greater than 98 percent of the energy supply is from renewable sources. Despite this achievement, energy costs are notably higher than comparable rates in the United States. Costa Rican laws, regulations, and practices are generally transparent and foster competition. With regards to environmental regulations, the Costa Rican organization that reviews environmental impact statements has been historically slow to issue its findings, often causing delays for investors in completing projects.
In recent years, the government has made efforts to improve the enforcement of intellectual property laws throughout the country. As a result of these efforts, Costa Rica in 2020 was removed from the U.S. Trade Representative’s Special 301 Report due to concrete steps the country took to address unlicensed software use in the central government and to implement an online record system to improve border enforcement.