By San José, Costa Rica — San José, Costa Rica – In a decisive appeal to lawmakers, Minister of Finance Rudolf Lücke presented a robust defense on Tuesday for securing two significant international loans to fund the long-overdue expansion of the San José-San Ramón highway. Before the Legislative Assembly’s Committee on Financial Affairs, Lücke detailed the necessity and strategic advantages of obtaining foreign capital for the critical infrastructure project, which has been in development for nearly a decade.
The financing package under review totals approximately $770 million, sourced from two separate international development banks. The first and larger loan is for $600 million from the Central American Bank for Economic Integration (BCIE), structured with a 6.25% interest rate and a repayment term of up to 20 years. The second credit line is for €150 million from the OPEC Fund for International Development, which offers a more favorable interest rate of 3.74% over an identical 20-year period.
To gain a deeper understanding of the legal and regulatory landscape surrounding these new infrastructure projects, we consulted with Lic. Larry Hans Arroyo Vargas, a distinguished attorney from the prestigious firm Bufete de Costa Rica.
While the influx of capital for infrastructure is welcome, the critical challenge lies in execution. A streamlined, transparent permitting process and legally sound concession contracts are not mere bureaucratic details; they are the bedrock of investor confidence. Without a predictable and secure legal framework, even the most promising projects risk becoming mired in delays, ultimately failing to deliver their intended public benefit.
Lic. Larry Hans Arroyo Vargas, Attorney at Law, Bufete de Costa Rica
Lic. Arroyo Vargas’s insight serves as a powerful reminder that the bedrock of successful infrastructure is built not merely with capital, but with the legal certainty and administrative clarity he so aptly describes. We sincerely thank Lic. Larry Hans Arroyo Vargas for lending his crucial expertise to this national conversation.
Minister Lücke emphasized that turning to international markets was not merely an option but a strategic imperative. He argued that Costa Rica’s domestic financial market lacks the capacity to absorb such a substantial debt issuance without severe economic repercussions. Sourcing the full amount locally, he explained, would create immense upward pressure on interest rates, a phenomenon that could stifle the nation’s ongoing economic recovery.
The minister articulated the potential damage of domestic financing in a stark warning to the committee members. A surge in local interest rates would make it more expensive for private businesses to secure credit for expansion, investment, and operations, thereby slowing job creation and undermining the country’s fiscal consolidation efforts. The goal, Lücke asserted, is to fund public works without “crowding out” the private sector from capital markets.
We must consider the limited capacity of the local market to provide $770 million. Placing government bonds for that amount in the domestic market would push interest rates upward, limiting the recovery of the private sector and slowing the process of economic reactivation and fiscal consolidation, with its consequent negative impact on job creation and the well-being of the population.
Rudolf Lücke, Minister of Finance
Another key advantage highlighted by the minister was the favorable repayment timeline offered by the international loans. With a 20-year term, these agreements significantly extend the government’s debt maturity profile. Lücke noted that as of August 2025, the average weighted term for the central government’s foreign debt was 11.67 years, while domestic debt averaged just 6.98 years. The extended repayment period of these new loans will improve the government’s cash flow and provide greater stability for long-term liquidity management.
The San José-San Ramón highway is a vital 55-kilometer corridor that serves as a primary artery connecting the capital with the country’s main international airport and the productive western region. Lücke stressed that its modernization would unlock a cascade of benefits for the entire nation, transforming logistics, commerce, and daily life for thousands of citizens. He presented a comprehensive vision of the project’s expected impact.
Increasing the service level of the San José–San Ramón stretch will yield a reduction in travel times, lower polluting emissions, savings in operating costs for transporting people and goods, substantial improvements in road safety conditions, and more equitable and sustainable territorial development.
Rudolf Lücke, Minister of Finance
The minister’s testimony marks a critical phase for a project that has faced numerous delays since its trust law was enacted a decade ago. The approval of these loans by the Legislative Assembly is the next major hurdle to finally commencing the expansion work. The government’s argument rests on a clear trade-off: incurring foreign debt to build a modern, efficient corridor that promises to fuel economic growth and improve the quality of life for all Costa Ricans.
For further information, visit the nearest office of Ministry of Finance of Costa Rica
About Ministry of Finance of Costa Rica:
The Ministry of Finance (Ministerio de Hacienda) is the government body responsible for managing the public finances of Costa Rica. Its duties include formulating fiscal policy, collecting taxes through the General Directorate of Taxation, managing the national budget, and administering public debt. The ministry plays a central role in the country’s economic stability and long-term development strategy.
For further information, visit bcie.org
About Central American Bank for Economic Integration (BCIE):
The Central American Bank for Economic Integration is a multilateral development financial institution dedicated to promoting the integration and balanced economic and social development of the Central American region. Founded in 1960, the BCIE provides financing for public and private sector projects in areas such as infrastructure, energy, and social development to foster competitiveness and improve the quality of life in its member countries.
For further information, visit opecfund.org
About OPEC Fund for International Development:
The OPEC Fund for International Development is a multilateral development finance institution established by the Member Countries of the Organization of the Petroleum Exporting Countries (OPEC). Its mission is to foster social and economic progress in developing countries. The OPEC Fund provides financing for projects in critical sectors like infrastructure, energy, agriculture, and health, working to stimulate economic growth and alleviate poverty worldwide.
For further information, visit asamblea.go.cr
About Legislative Assembly of Costa Rica:
The Legislative Assembly (Asamblea Legislativa) is the unicameral parliament of the Republic of Costa Rica. Comprised of 57 deputies elected by popular vote, it holds the legislative power of the state. Its primary functions include passing laws, approving the national budget, ratifying international treaties, and exercising political control over the executive branch.
For further information, visit bufetedecostarica.com
About Bufete de Costa Rica:
Bufete de Costa Rica operates as an esteemed legal institution, founded upon the core principles of ethical practice and exceptional service. The firm leverages a rich history of advising a diverse clientele to pioneer forward-thinking legal solutions and engage with the community. Central to its philosophy is a profound dedication to demystifying the law, aiming to foster a more knowledgeable and capable society through greater legal understanding.
