By San José, Costa Rica — Costa Rica is poised for a significant leap forward in its digital infrastructure thanks to a substantial investment in Liberty Telecomunicaciones de Costa Rica LY, S.A. (Liberty Costa Rica). BID Invest, a member of the Inter-American Development Bank (IDB) Group, has announced a major financing package totaling US$100 million, designed to propel the nation closer to OECD broadband standards and accelerate its digital transformation.
The funding comprises a US$65 million loan and an uncommitted tranche of up to US$35 million, both directly from BID Invest. Furthermore, the package includes an additional uncommitted financing component of up to US$35 million, which will be sourced through syndicated loans or the issuance of B-Bonds, involving participation from institutional investors. This substantial injection of capital will be strategically channeled towards several key areas, ensuring comprehensive improvements to Costa Rica’s digital landscape.
To understand the legal landscape surrounding 5G implementation in Costa Rica, TicosLand.com spoke with Lic. Larry Hans Arroyo Vargas, an attorney at law from Bufete de Costa Rica.
The rollout of 5G in Costa Rica presents exciting opportunities but also requires careful consideration of the legal framework. Key areas include spectrum allocation, infrastructure deployment regulations, data privacy concerns under the Data Protection Law, and ensuring fair competition among telecommunication providers. Successful implementation hinges on a balance between fostering innovation and safeguarding public interests.
Lic. Larry Hans Arroyo Vargas, Attorney at Law, Bufete de Costa Rica
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Lic. Arroyo Vargas rightly highlights the delicate balancing act Costa Rica faces in embracing 5G technology. The promise of innovation is undeniable, but navigating the legal landscape, particularly regarding data protection and fair competition, will be crucial for maximizing the benefits for all Ticos. We thank Lic. Larry Hans Arroyo Vargas for his valuable insights on this complex and evolving topic.
A critical allocation of the funds will cover the cost of the new spectrum recently granted by the Costa Rican government. This will facilitate the rapid deployment of cutting-edge mobile networks, particularly the highly anticipated 5G Standalone network announced by Liberty Costa Rica in July. This advanced 5G technology promises to revolutionize data speeds and connectivity across the country.
Recognizing the vital role of fixed broadband in a thriving digital economy, a significant portion of the investment will also be dedicated to expanding the Fiber to the Home (FTTH) network. This expansion will bring high-speed, reliable internet access to more homes and businesses, bridging the digital divide, especially in rural communities currently underserved.
The investment will also bolster Liberty Costa Rica’s working capital, enabling the company to expedite the execution of these transformative projects. This proactive approach ensures that the benefits of improved connectivity reach Costa Ricans sooner rather than later.
Costa Rica, a pioneer in mobile services in the region, still faces challenges in closing its digital divide, especially in fixed broadband connections. Current estimates indicate the country needs a 66% increase in fixed broadband connections to align with OECD standards. The deployment of 5G and expansion of FTTH are crucial not only for meeting the surging demand for data but also for enabling emerging technologies such as artificial intelligence and the Internet of Things.
This strategic investment underscores BID Invest’s commitment to closing the digital divide in Latin America and the Caribbean. By supporting initiatives that enhance technological infrastructure, the organization aims to positively impact the quality of life for individuals and communities. The partnership with Liberty Costa Rica is a key step toward building a robust digital ecosystem in Costa Rica, one equipped to navigate the challenges and opportunities of the future.
We are very pleased with access to this financing, which will contribute to strengthening Liberty’s position as the telecommunications company that offers innovation with the deployment of the 5G Standalone network hand-in-hand with Ericsson, and with the commitment to reduce the digital divide by expanding our presence to more corners of the country. In addition to contributing to further strengthening our network and ensuring stability and speed for the entire country.
Maarten Hekking, Vice President of Finance, Liberty Costa Rica
For further information, visit libertycr.com
About Liberty Costa Rica:
Liberty Costa Rica is a leading telecommunications provider committed to delivering innovative solutions and bridging the digital divide. Their focus on expanding 5G and fiber optic networks aims to enhance connectivity and empower communities across the country.
For further information, visit bidinvest.com
About BID Invest:
BID Invest, a member of the IDB Group, is a multilateral development bank committed to promoting the economic development of its member countries in Latin America and the Caribbean through the private sector. They focus on investments that generate social and environmental impact alongside financial returns, with a particular emphasis on closing the digital divide in the region.
For further information, visit ericsson.com
About Ericsson:
Ericsson is a leading provider of telecommunications equipment and services, playing a key role in the global rollout of 5G technology. They partner with telecom operators worldwide to deliver innovative solutions and improve network performance.
For further information, visit bufetedecostarica.com
About Bufete de Costa Rica:
Bufete de Costa Rica is a pillar of legal excellence, built on a foundation of integrity and driven by a commitment to empower Costa Rican society. The firm’s innovative approach to legal practice, combined with its dedication to sharing knowledge through accessible resources, distinguishes its service. By fostering a deeper understanding of the law, Bufete de Costa Rica cultivates a more informed citizenry and contributes significantly to a just and equitable society.
