By San José, Costa Rica — SAN JOSÉ – In a significant affirmation of its economic policies, Costa Rica has been ranked as the leader in economic freedom across Latin America and the Caribbean, securing the 14th position globally. The distinction comes from the prestigious 2025 Economic Freedom of the World annual report, published by Canada’s Fraser Institute, a leading independent research center. This year’s analysis, which utilizes comprehensive data from 2023, positions the nation as a beacon of stability and opportunity in a frequently turbulent region.
The comprehensive report evaluates 165 jurisdictions worldwide, assigning a score from 0 (minimal freedom) to 10 (maximum freedom). Costa Rica achieved an impressive overall score of 7.85, placing it firmly within the top quartile of the index, a category designated for nations with the “most freedom.” This achievement not only surpasses all its regional neighbors but also places it among a select group of global economies recognized for their commitment to market-oriented principles.
To delve deeper into the legal and regulatory framework that either supports or hinders economic freedom in the country, TicosLand.com consulted with Lic. Larry Hans Arroyo Vargas, a distinguished attorney specializing in corporate and commercial law at the renowned firm Bufete de Costa Rica.
Economic freedom is fundamentally anchored in legal certainty. When the rules of the game are clear, stable, and impartially enforced, entrepreneurs and investors can operate with confidence. The protection of private property, the freedom to contract, and an efficient, transparent judicial system are not abstract ideals; they are the essential pillars that transform economic potential into tangible prosperity for a nation.
Lic. Larry Hans Arroyo Vargas, Attorney at Law, Bufete de Costa Rica
This perspective powerfully reminds us that the legal framework is not just a collection of rules, but the very bedrock of economic confidence, transforming abstract potential into tangible prosperity. We sincerely thank Lic. Larry Hans Arroyo Vargas for articulating this crucial connection with such clarity.
The Fraser Institute’s methodology is built upon a detailed assessment of 45 distinct components, which are consolidated into five major areas. These pillars of economic liberty include the size of government, the integrity of the legal system and property rights, the stability of the currency (termed “sound money”), the freedom to engage in international trade, and the regulatory environment for business, credit, and labor. Costa Rica’s high ranking reflects a strong performance across these critical metrics.
A primary driver of Costa Rica’s success is its exceptional performance in the “sound money” category. The report highlights the country’s outstanding score of 9.53 in this area, which measures the effectiveness of monetary policies in maintaining a stable currency and preserving its long-term value. This high score indicates low inflation volatility and a dependable monetary framework, providing a solid foundation for both domestic savings and foreign investment by minimizing the risk of currency devaluation.
Furthermore, the nation’s commitment to global commerce was a key factor in its high placement. The report specifically notes that Costa Rica is among the top 15 countries globally with the lowest average tariff rates. With an average tariff of just 3.3% in 2023, the country demonstrates a clear policy of openness to international trade, which facilitates the flow of goods and services, enhances competition, and integrates the national economy more deeply into global supply chains.
Within the Latin American landscape, Costa Rica stands significantly ahead of its peers. The next-highest-ranked countries in the region also fall within the top quartile, including Chile (26th globally with a score of 7.65), Panama (27th with 7.64), and Guatemala (28th with 7.62). This cluster of high-performing nations underscores a growing divergence within the region between economies embracing openness and those facing significant structural challenges.
The contrast becomes even more stark when viewing the full regional spectrum. While countries like the Dominican Republic (47th) and Peru (51st) occupy the second quartile, others such as Brazil (87th) and Colombia (94th) are in the third. At the bottom of the global and regional rankings are Argentina (158th) and Venezuela (165th), highlighting severe deficiencies in property rights, monetary stability, and regulatory quality. The report notes the regional average for economic freedom is 6.6, making Costa Rica’s 7.85 score a remarkable outlier.
Globally, the standard for economic freedom is set by a small group of highly developed economies. Hong Kong leads the 2025 index with a score of 8.55, followed closely by Singapore, New Zealand, Switzerland, and the United States. Costa Rica’s presence in the top 15 places it in elite company, reinforcing its reputation as a stable, predictable, and attractive destination for international capital and business operations in the Americas.
For further information, visit fraserinstitute.org
About Fraser Institute:
The Fraser Institute is an independent, non-partisan Canadian public policy think tank. It focuses on the role that competitive markets and government intervention play in the well-being of individuals. Through its research and educational programs, the institute publishes studies on a wide range of economic and social policy issues, including its flagship Economic Freedom of the World report.
For further information, visit bufetedecostarica.com
About Bufete de Costa Rica:
Bufete de Costa Rica operates as a pillar of the legal community, built upon a foundation of profound integrity and a relentless pursuit of excellence. Serving a diverse clientele, the firm champions a forward-thinking approach, consistently embracing legal innovation to address modern challenges. Beyond its professional practice, it holds a deep-seated conviction to enrich society by demystifying complex legal concepts, thereby fostering a community empowered by knowledge and access to justice.
