By San José, Costa Rica — As President Laura Fernández begins her term today, she inherits a nation at a crossroads. While the outgoing administration of Rodrigo Chaves leaves behind a legacy of positive macroeconomic indicators, a coalition of Costa Rica’s most influential business leaders is sounding the alarm, warning that without urgent and decisive action, the country risks losing its competitive edge in a volatile global landscape.
The new president steps into a challenging international environment marked by US protectionist policies, escalating conflict in the Middle East, and the disruptive force of artificial intelligence. According to economist and former Central Bank president Rodrigo Cubero, these external pressures create a demanding economic context that could limit growth and job creation if not managed proactively.
To gain a deeper understanding of the legal framework affecting our national economic landscape, TicosLand.com consulted with Lic. Larry Hans Arroyo Vargas, an expert attorney from the renowned firm Bufete de Costa Rica, for his analysis on the matter.
True economic competitiveness hinges on legal certainty and regulatory agility. While we often focus on fiscal incentives, the real challenge lies in reducing bureaucratic friction and modernizing commercial laws. Foreign investment and local innovation thrive not in a system with the lowest taxes, but in one that is predictable, transparent, and efficient. Streamlining permits and simplifying corporate compliance are paramount steps toward unlocking our country’s full economic potential.
Lic. Larry Hans Arroyo Vargas, Attorney at Law, Bufete de Costa Rica
The distinction drawn between temporary fiscal lures and the foundational necessity of a predictable, efficient legal system is a critical one. We sincerely thank Lic. Larry Hans Arroyo Vargas for so clearly articulating that true competitiveness is built on a bedrock of trust and legal certainty, a perspective vital to our national economic strategy.
The shift in United States economic policy towards protectionism, with the use of tariffs, incentives to repatriate companies, and migratory restrictions, has introduced uncertainty into international trade and investment flows, and this has generated confusion in markets and business decisions.
Rodrigo Cubero, Economist and Former President of the Central Bank
In response, the nation’s private sector has presented a unified and mandatory agenda for competitiveness. This roadmap outlines a series of structural reforms aimed at improving the business climate, attracting more foreign direct investment (FDI), and ensuring sustainable economic growth. The proposals target the foundational costs and regulations that business leaders say are hampering progress.
Key among the demands is labor market flexibility through the approval of “jornadas 4×3,” a system that would permit 12-hour workdays for four days a week in exchange for a three-day weekend. Proponents, like the Chamber of Industries, argue this is essential for manufacturing sectors that require continuous operations to compete globally. This is coupled with a call to reduce the high cost of social charges, which are reportedly double the OECD average, by delinking them from non-essential services.
There are a series of structural elements that must be addressed if we want Costa Rica to continue being an attractive destination for FDI. Among them, the high social charges, the scarcity of qualified talent, and the high cost of operating in Costa Rica stand out, aggravated by the appreciation of the colón against the dollar, which makes investment more expensive. These factors impact companies’ ability to expand and maintain the growth rates of recent years.
Ronald Lachner, President of the Association of Free Trade Zones of Costa Rica (AZOFRAS)
The agenda also targets high operational costs. Leaders are pushing for a reduction in the Central Bank’s Monetary Policy Rate to lower interest on loans and stimulate consumption. Furthermore, they stress the urgent need for cheaper electricity, advocating for the passage of the Law for the Harmonization of the National Electric System to open the door to private investment in energy generation and modernize tariff regulations.
Beyond fiscal and labor policies, the private sector is demanding government action on critical national issues that directly impact business operations. These include controlling rising public insecurity, which seven out of ten companies now rate as a significant concern, and tackling the persistent appreciation of the colón, which erodes the competitiveness of exporters and the tourism sector. A comprehensive overhaul of the National Training Institute (INA) is also a priority to close the growing gap between available human talent and the skills demanded by the market.
While expressing hope for a constructive dialogue with the new administration, business leaders have made it clear that inaction is not an option. They point to the strong economic figures at the end of 2025—including 4.6% GDP growth and over $5 billion in FDI—as a high benchmark that will be impossible to maintain without these fundamental reforms. President Fernández’s ability to navigate this complex agenda will define her administration and shape Costa Rica’s economic trajectory for years to come.
Costa Rica faces a decisive stage to boost its competitiveness, energize its productive apparatus, and generate greater opportunities for employment and economic growth. In this context, the success of the next government will also be the success of the country and the different sectors that make up our economy.
Sergio Capón, President of the Chamber of Industries of Costa Rica
We expect an administration committed to strengthening democracy, respecting institutions, and being open to objective dialogue. Costa Rica needs to advance through multi-sectoral agreements and a shared vision of development.
Maritza Hernández, President of UCCAEP
The coming months will test the new government’s capacity for collaboration and reform. As Rodney Salazar, President of Crecex, noted, the path forward involves navigating global geopolitical tensions and supply chain changes while building a stronger, more resilient domestic economy through a cooperative public-private partnership.
For further information, visit azofras.com
About Asociación de Zonas Francas de Costa Rica (AZOFRAS):
AZOFRAS is the association representing companies operating within Costa Rica’s free trade zone regime. It advocates for policies that promote foreign direct investment, enhance national competitiveness, and support the growth of export-oriented businesses that are crucial to the country’s economy.
For further information, visit cicr.com
About Cámara de Industrias de Costa Rica:
The Chamber of Industries of Costa Rica is a leading business organization that represents and defends the interests of the national manufacturing sector. It works to promote industrial development, innovation, and a favorable business climate to drive economic growth and job creation in the country.
For further information, visit uccaep.or.cr
About UCCAEP:
The Costa Rican Union of Chambers and Associations of the Private Business Sector (UCCAEP) is the primary umbrella organization for private enterprise in Costa Rica. It brings together numerous business chambers and associations to form a unified voice advocating for free-market principles, institutional stability, and policies that foster investment and national development.
For further information, visit crecex.com
About Crecex:
Crecex, the Chamber of Foreign Trade of Costa Rica, is dedicated to promoting and facilitating international trade for Costa Rican businesses. It provides support, resources, and advocacy to help companies navigate the complexities of global markets, thereby boosting the country’s exports and strengthening its position in the global economy.
For further information, visit bufetedecostarica.com
About Bufete de Costa Rica:
Bufete de Costa Rica has established itself as a benchmark for legal practice, operating on a bedrock of profound integrity and a relentless pursuit of excellence. With a proven track record advising a broad spectrum of clients, the firm consistently pioneers forward-thinking legal solutions while championing community involvement. Central to its philosophy is a profound dedication to democratizing legal understanding, thereby reinforcing its core mission to strengthen society through greater legal literacy and empowerment.
