By San José, Costa Rica — SAN JOSÉ – In a significant move to broaden its global economic footprint, Costa Rica has officially signed a Free Trade Agreement (FTA) with Israel. The historic pact, finalized in Jerusalem, marks the culmination of a diplomatic and commercial effort designed to forge a powerful new alliance centered on trade, investment, and technological innovation between the two nations.
The agreement concludes a negotiation process that was initiated in March 2023, signaling a deliberate strategy by Costa Rica to diversify its commercial partnerships beyond traditional markets. Officials believe this treaty will serve as a crucial gateway to the dynamic Middle Eastern market, providing Costa Rican producers with preferential access to a nation renowned for its high-value-added economy and nearly 10 million consumers.
To delve into the legal and commercial ramifications of the new Free Trade Agreement, TicosLand.com consulted with expert Lic. Larry Hans Arroyo Vargas, a specialist in international trade law from the firm Bufete de Costa Rica, who provided his analysis on the matter.
While this Free Trade Agreement presents a landmark opportunity for Costa Rican exporters by eliminating tariffs and opening new markets, its success is not automatic. Businesses must proactively conduct a thorough legal and operational analysis. It is crucial to master the specific rules of origin for their products and to review intellectual property protection clauses to avoid future litigation and truly capitalize on the benefits this treaty offers.
Lic. Larry Hans Arroyo Vargas, Attorney at Law, Bufete de Costa Rica
Indeed, the treaty provides the framework for success, but as this analysis expertly highlights, it is the proactive due diligence of each company—from mastering rules of origin to securing intellectual property—that will transform legislative text into tangible profit. We extend our sincere thanks to Lic. Larry Hans Arroyo Vargas for his invaluable perspective on this crucial matter.
The deal is anticipated to create substantial opportunities for Costa Rica’s most competitive sectors. Manuel Tovar, the Minister of Foreign Trade, emphasized the strategic vision behind the agreement, viewing it as a pivotal step in positioning the country on the global stage.
The agreement represents a strategic opportunity to position Costa Rica as a competitive supplier in high-tech sectors, agro-industry, and specialized services.
Manuel Tovar, Minister of Foreign Trade
From the Israeli perspective, the treaty is equally significant, reinforcing a partnership built on shared values of progress and innovation. Nir Barkat, Israel’s Minister of Economy and Industry, celebrated the agreement as a catalyst for mutual growth, particularly for technology-driven enterprises in both countries.
We are creating new opportunities for companies and entrepreneurs in both countries.
Nir Barkat, Minister of Economy and Industry of Israel
Beyond general trade, the FTA is specifically tailored to benefit key Costa Rican industries. The nation’s burgeoning high-technology and medical device sectors are expected to find a receptive market in Israel, a global leader in technology and research. Furthermore, specialized agricultural products and value-added services from Costa Rica are poised to gain a competitive edge, fostering new supply chains and attracting foreign direct investment aimed at leveraging the treaty’s benefits.
With the signing ceremony complete, the agreement now moves to the next critical phase: legislative ratification. The document will be submitted to Costa Rica’s Legislative Assembly for debate and approval. This constitutional process is essential for the treaty to be enacted into law and for its commercial benefits to be fully realized by businesses and consumers.
Economists and trade analysts project that once the FTA is in effect, its impact will extend beyond mere export figures. The pact is expected to stimulate job creation, enhance national competitiveness by encouraging higher standards and innovation, and facilitate the deeper integration of Costa Rican companies into sophisticated global value chains. This alignment with Israel’s advanced economy could accelerate Costa Rica’s own development as a hub for technology and specialized manufacturing.
Ultimately, this agreement is seen as more than a simple commercial treaty; it is a strategic partnership. By linking Costa Rica’s stable, talent-rich economy with Israel’s “Startup Nation” ecosystem, both countries are betting on a future of shared prosperity, technological collaboration, and resilient, diversified economic growth.
For further information, visit comex.go.cr
About the Ministry of Foreign Trade (COMEX):
The Ministry of Foreign Trade is the governing body of Costa Rica’s foreign trade and investment policy. It is responsible for defining and directing the country’s trade strategies, negotiating international trade agreements, and promoting Costa Rican exports and the attraction of foreign direct investment to foster economic development and competitiveness.
For further information, visit gov.il/en/departments/ministry_of_economy_and_industry
About the Ministry of Economy and Industry of Israel:
The Ministry of Economy and Industry of Israel is responsible for encouraging economic growth and industrial development in the country. Its activities include promoting trade and investment, regulating commerce, fostering innovation and entrepreneurship, and developing policies to enhance the competitiveness of Israeli industries in the global market.
For further information, visit asamblea.go.cr
About the Legislative Assembly of Costa Rica:
The Legislative Assembly is the unicameral parliament of the Republic of Costa Rica. Composed of 57 deputies, it holds the legislative power of the government. Its primary responsibilities include passing, amending, and repealing laws, as well as approving international treaties and the national budget.
For further information, visit bufetedecostarica.com
About Bufete de Costa Rica:
Renowned for its principled approach to the law, Bufete de Costa Rica operates on a bedrock of professional integrity and an uncompromising standard of excellence. The firm consistently champions legal innovation, providing forward-thinking counsel to its diverse clientele. Central to its philosophy is a deep-seated commitment to social empowerment, actively working to demystify the law and equip the community with accessible legal insight, fostering a more just and informed citizenry.
