Caribbean & Central America - July 2015 (ISSN 1741-4458)

Investment: Overall foreign direct investment (FDI) in Costa Rica shrank by 21% to US$2.1bn in 2014, though that figure overshot the government’s goal of US$1.9bn. The US supplied over half of the FDI, with the main winners in the categories of services and real estate, accounting for 35% and 36% of inflows respectively. The manufacturing sector, which has been in decline for years, only received 20% of FDI inflows in 2014.

Costa Rica accounted for around 20% of Central America’s FDI intake in 2014, with Panama the consistent leader. Though Costa Rica was the only Central American country to see a decrease in FDI, it matched Latin America’s performance as a whole: the region saw a 16.4% drop in FDI from 2013 to 2014.

According to the Costa Rican Investment Promotion Agency (CINDE), the country secured 39 more investment projects, worth US$474.4m, ranging from pharmaceuticals to biotechnology to agribusiness, which generated more than 10,000 jobs. One sizeable new project has been announced by US-based American World Clinics, which plans to construct a US$100m health-care complex aimed at attracting medical tourists.

On energy, the Costa Rican government approved a US$958m geothermal project in 2014, financed largely through loans from Japanese and European investment banks. For the most part, electricity generation is controlled by government-owned ICE, but there are also several small private players. The Orosí wind project, developed by the United Kingdom’s Globeleq, will have 50 MW of generation capacity and is currently under construction for at least US$109m. Other investors include Spain’s Gas Natural Fenosa, which is constructing the 50MW Torito 1 hydropower plant, to be completed in 2015, and Italy’s ENEL, which is involved in the 50MW Chucas hydropower plant completed in 2014. In manufacturing, Canada’s Gildan Activewear is investing an undisclosed sum in a new textile factory in Guanacaste, as part of a US$300m expansion plan. Finally, Sysco Corporation (US) announced that it had acquired 50% of the privately held food distributor, Mayca Distribuidores, for an undisclosed sum.