NEWSMAKERS: COSTA RICA
By Dan Keeler
With the ink still wet on a Moody’s rating upgrade from Ba1 to Baa3 investment grade, Costa Rica has revealed it is considering a bond issue in the near future. José Rossi, chairman of CINDE, Costa Rica’s investment promotion agency, says the country’s return to investment grade—it last enjoyed that status three decades ago—provides a prime opportunity to issue more debt. “Nothing has been decided yet,” he stresses, but explains that the proceeds from any bond sale would “go into the resources pool to repay the bonds that are falling due soon, plus [pay for] projects in infrastructure and education, along with other debt programs that the country has with the multilateral community.”
Costa Rica’s political leaders have been pushing hard to encourage international investors to pour more money into the country. The president, Laura Chinchilla, says her government is hoping to attract $9 billion between 2010 and 2014. “We are working very hard enhancing our business environment and improving our competitiveness,” she says.
Chinchilla says the country recognizes it needs to invest in order to remain competitive in attracting FDI: “We need to invest much more on roads, to modernize our ports. And since we are looking to attract even more investment we will need to provide them with the right amount of the high quality human resources they will need,” she adds.
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Chinchilla: Pushing hard for more foreign investment |
Chinchilla says the country recognizes it needs to invest in order to remain competitive in attracting FDI: “We need to invest much more on roads, to modernize our ports. And since we are looking to attract even more investment we will need to provide them with the right amount of the high quality human resources they will need,” she adds.
While the government is focused on creating ideal conditions for foreign investors, business leaders are concerned that recent sharp appreciation in the currency is damaging Costa Rica’s competitiveness. “Investors are taking advantage of the interest rate premium [in Costa Rica], which is pushing up the currency,” says Rossi. “It is a very big concern for our exporters—they are suffering. But other than that, it is good news because it is indicative of the strength of our economy,” he adds.
