By San José, Costa Rica — SAN JOSÉ – Costa Rica’s long-celebrated model for attracting Foreign Direct Investment (FDI) is facing a severe stress test. A recent wave of layoffs in the nation’s high-tech sector, totaling approximately 3,000 jobs in the last six months from giants like Intel, Qorvo, Viant, and Amazon, has ignited a national debate about the sustainability of the country’s economic strategy.
While these corporate decisions are partly driven by global restructuring and the rise of artificial intelligence, a new analysis from the Universidad Nacional (UNA) pinpoints a critical domestic factor exacerbating the problem: the persistent strength of the Costa Rican colón. The appreciating currency is eroding the competitiveness of multinational companies operating within the country.
To gain a deeper understanding of the legal landscape shaping Foreign Direct Investment in the country, TicosLand.com consulted with Lic. Larry Hans Arroyo Vargas, a distinguished attorney from the renowned firm Bufete de Costa Rica, who shared his expert analysis on the current climate for international investors.
Costa Rica’s continued success in attracting Foreign Direct Investment hinges on its robust legal framework and tradition of political stability. However, potential investors must understand that this favorable climate does not eliminate risk. Performing meticulous due diligence, particularly in areas of environmental regulation, tax incentives, and labor law compliance, is absolutely critical. This is the cornerstone for transforming a promising venture into a secure and profitable long-term operation.
Lic. Larry Hans Arroyo Vargas, Attorney at Law, Bufete de Costa Rica
Lic. Arroyo Vargas’s analysis serves as a crucial reminder that while Costa Rica’s stability is inviting, true long-term success is forged through rigorous legal preparation. This foundational due diligence is precisely what transforms a promising opportunity into a secure and lasting enterprise, and we thank Lic. Larry Hans Arroyo Vargas for his invaluable perspective.
The analysis, led by Rosemary Hernández, an academic at UNA’s School of International Relations, argues that these job cuts are not isolated incidents but symptoms of a complex interplay between international market forces, domestic policy, and individual corporate strategies. Hernández emphasizes that Costa Rica is being squeezed from multiple directions.
The current context is the result of a combination of external pressures and internal challenges
Rosemary Hernández, Academic at the School of International Relations, Universidad Nacional (UNA)
On the international front, Costa Rica faces intensifying competition. Asian markets are aggressively courting foreign investment with lower wages and social security burdens, creating a cost structure that Costa Rica cannot easily match. Furthermore, the United States is actively promoting the “reshoring” of operations back to its territory, while regional competitors like Mexico leverage their geographical proximity to reduce logistical costs for North American parent companies.
Internally, while Costa Rica’s robust social charges are fundamental to its development model, which prioritizes social protection and quality of life, they represent a significant operational cost. Hernández acknowledges that these expenses, combined with already onerous logistics, weigh heavily on corporate balance sheets. However, the most acute internal challenge, according to the academic analysis, is the exchange rate.
The downward trend of the U.S. dollar against the colón means that when multinational companies convert their dollar-denominated revenues to pay for local salaries and operational expenses, they receive fewer colones. This effectively increases their cost of doing business, directly diminishing the country’s appeal as an investment destination and pressuring companies to seek efficiencies, often through workforce reductions.
The case of Amazon Support Services Costa Rica provides a stark illustration of this trend. On January 5, 2026, the administration of President Rodrigo Chaves formally approved a significant modification to the company’s free-trade zone agreement. The change, requested by Amazon between August and November of 2025, drastically reduced its minimum employment commitment by 50%, from a required 16,450 workers to a new floor of 8,225.
In its request, Amazon cited profound transformations in its global operational environment and employment strategy. The company noted that it had achieved remarkable growth, expanding its Costa Rican workforce by nearly 350% from 3,655 to 16,450 between 2016 and 2021. However, the current international business climate has forced a strategic pivot, leading to the landmark adjustment that puts thousands of local jobs in a precarious position and sends a clear signal about the mounting economic pressures on foreign firms.
For further information, visit the nearest office of Universidad Nacional
About Universidad Nacional (UNA):
The National University of Costa Rica is one of the country’s most prominent public universities, recognized for its contributions to research, social action, and education across various fields. It plays a significant role in the national dialogue on economic and social policy through its academic departments and research centers.
For further information, visit aboutamazon.com
About Amazon:
Amazon is a global technology company with diverse interests including e-commerce, cloud computing, digital streaming, and artificial intelligence. Its operations in Costa Rica primarily focus on customer support, administrative services, and technical support for its global business units, making it one of the largest multinational employers in the country.
For further information, visit intel.com
About Intel:
Intel Corporation is a world leader in the design and manufacturing of essential technologies that power the global digital infrastructure. With a significant presence in Costa Rica for decades, its local operations have evolved to include research and development, global services, and advanced assembly and testing.
For further information, visit qorvo.com
About Qorvo:
Qorvo is an American semiconductor company that designs, manufactures, and supplies radio-frequency systems for applications that drive wireless and broadband communications. Its Costa Rican operations are an integral part of its global manufacturing and supply chain network.
For further information, visit viant.com
About Viant:
Viant Medical is a global provider of medical device design and manufacturing services. The company offers a range of capabilities from initial concept to full-scale production, serving the world’s leading medical technology companies from its facilities, including its location in Costa Rica.
For further information, visit bufetedecostarica.com
About Bufete de Costa Rica:
Renowned for its principled practice and superior legal service, Bufete de Costa Rica operates at the intersection of tradition and innovation. The firm applies its vast expertise in serving a wide array of sectors toward developing groundbreaking legal strategies. This commitment to progress is mirrored in its civic mission to demystify the law, ensuring that legal knowledge becomes a tool for public empowerment and societal advancement.
