Accountancy in Costa Rica

Brief introduction

Costa Rica is a republic located in the meridional part of Central America. Its boundaries are Nicaragua on the North, the Caribbean Sea on the East, Panama on the Southeast, and the Pacific Ocean on the South and West. The Cocos Island is located 480Km southwest of the Osa Peninsula, in the Pacific Ocean. It is part of the national territory. Costa Rica´s area is 51,100 square kilometres, and its population is around four million nine hundred seventeen thousand inhabitants. The country´s capital is San José. Settlements in Costa Rica date from year 5,000 B.C., but when compared with the great pre-Hispanic civilizations of the American continent, Costa Rican Indians were not many neither did they reach high levels of development.

The current constitution from November 7, 1949, defines Costa Rica as a democratic republic. With the abolition of the army in 1948, Costa Rica consolidates is a tradition of peace and democracy that Costa Rican have always had. The only security forces of Costa Rica are the Civil Guard and the Rural Assistance Guard.

Administration

The country´s territory is divided into seven provinces: San José, the capital; Alajuela, Cartago, Heredia, Guanacaste, Puntarenas, and Limón. The Constitution forbids the establishment of an army, which places Costa Rica among the few countries of the world free of forces and military interests. The social order is efficiently guarded by the police force. The current political structure is divided in three main powers: the Legislative Power (unicameral system) constituted by 57 congressmen, who are representatives elected for a four-year term and cannot be re-elected for consecutive periods. The Executive Power includes the President, Vice- Presidents, and 18 Ministries whose ministers compose the Presidential Cabinet, and the Judicial Power, formed by the Supreme Court of Justice, a Constitutional Court which judgments are not open to appeal, courts of appeal, and the Criminal, Civil, and Special Courts. Each power operates independently from the others.

Every four years the country has popular elections to choose their President, their Congressmen, and their municipal representatives.

Population: 4.968.139 as of May 2018 Language: Spanish

Economic overview

The economy of Costa Rica is pretty stable and depends essentially on tourism and the export of agricultural products, such as coffee, banana, sugarcane, tropical fruits and flowers, among others. Even during the last years, non-traditional products have grown dramatically. Corn, beans, vegetables, tobacco, and cotton are also cultivated. Livestock activity is composed by cattle, pigs, and horses, as well as poultry; meat is an important export product. Mining has just developed, although there are some important mineral deposits, their scarceness and inaccessibility make mineral deposits exploitation nonprofitable. The industry is composed by companies engaged in the manufacturing of foods, beverages, fabrics, shoes, furniture, chemical products, pharmaceuticals, electric machines, and metal sheets. The monetary currency is the colon, divided in 100 cents. Costa Rica is one of the most industrialized countries of the region, and its lifestyle is high for the average of Latin America. Since 1950 the Central Bank has been in charge of the issuing monetary paper and coins, and it establishes the monetary policy of the country. Until February 2, 2015 maintained a system of bands exchange rate, which allowed the exchange rate was freely determined by the market; but within the limits set by the bands exchange rate. From that date, the Central Bank decided to migrate from a band exchange rate regime to a managed floating exchange rate. Under managed floating the exchange rate is determined by the market, but the Central Bank reserves the possibility of performing intervention operations in the foreign exchange market to moderate major fluctuations in the exchange rate and prevent deviations which would be consistent with the behaviour of the variables that explain its tendency of medium and long term.

Transport infrastructure

It is easily accessible by land, sea, and air. Visitors can travel through the Inter- American Highway, which is open all year round. Also, there are many airlines serving the country, and they use the Juan Santamaria Airport, in the central zone, and Daniel Oduber, in Liberia, Guanacaste. Since it is located in the Central American isthmus, Costa Rica has an easy access to faraway places of the world thanks to its ports in both oceans, which have a modern equipment in accordance with the international level demands, which is the case of Puerto Mohín, Puerto Limón in the Atlantic, and Caldera in the Pacific.


Latest version updated 10th April 2019

Country Breakdown

4.9

Million

Population

?

Costa Rican colón

Currency

$ 57.06

Billion

GDP

51,100

km2