Costa Rica in the News

[SORREL L.]

Thank you, Jason, for your earlier replies to our questions! I’ve been reading the Tico Times and AM Costa Rica on-line news. They are reporting an increase in homicides and violent crimes and concerns that Costa Rican businesses have about the high cost of doing business, i.e., the taxes and cost of electricity. I’ve also noted the large number of newly unemployed workers especially in stores and restaurants. In addition, CR’s ranking on several indexes, re:cost of living, unemployment, infrastructure repair has fallen to 3rd place behind Panama and Ecquador. Also, Panama and Ecquador seem to be more heavily promoted than CR these days. What can you tell me about how these things will affect expats moving to the Central Valley area, but not in the big cities?

[JASON HOLLAND]

As far as the high cost of doing business, I think Costa Rica is a victim of its own success in a way. It’s stable here, economically and politically (at least as much as any place can be), so lots of companies have located here with more on the way. Unfortunately, high electricity rates are also an issue. Another thing to consider when opening a business is the very strong employee benefits/protections. As an employer you have to contribute to your employees’ social security program the equivalent of 26% of their salary so they can be part of the Caja government health program. There’s also worker compensation and a legally-mandated annual bonus equivalent to a full month’s salary. Business income taxes aren’t considered by most business owners to be that bad. But all those costs I mentioned are a concern.

Homicides and violent crimes have risen but are still very low and generally limited to certain areas, especially certain neighborhoods in the capital, San Jose. In general, Costa Rica is a very safe country and I and most of the expats I know feel very safe. What I am concerned with crime-wise is a break in at my home while I’m away – so I either have a security system or have somebody housesit. Also, I never leave anything unattended on the beach or in my car. In the Central Valley, this is less of a concern. Most of these property crimes take place in the beach areas where there is a high tourist activity.

All these issues are nothing new to Costa Rica and it’s nothing that will really affect somebody who moves to the country, probably least of all the Central Valley.

Looking at Ecuador and Panama, I can’t be specific there as I’ve never visited either country. But I do think that the cost of living is lower in Ecuador and the benefits for retired expats are much better in Panama. You might try contacting my colleagues in those countries at ecuador@internationalliving.com and panama@internationalliving.com

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