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Foreign investment in Costa Rica down 50% in first quarter

July 2nd, 2014 (InsideCostaRica.com) Foreign direct investment (FDI) fell 50% in the first quarter of this year compared to the same period in 2013, according to Costa Rica’s Central Bank.

 

During the first quarter of this year, foreign investment totaled $483 million, compared to $925 million during the same period in 2013.

 

The decline was attributed mainly to a decrease in commercial and residential real estate investment.  The real estate sector reached a record $377 million during the first quarter of last year, but totaled just $218 million in the first quarter of this year, a decline of 42%.

 

The Costa Rican Coalition for Development Initiatives (CINDE), said last year was exceptional in terms of real estate investment, and the decline this year is not necessarily part of a trend.

 

“The difference in quarterly [foreign direct investment] is largely a result of a decline in the real estate sector.  This does not necessarily represent a trend, since this type of investment is subject to business cycles,” said Gabriela Llobet, CINDE director general.

 

Real estate is not the only sector that has seen a drop in FDI.  Companies operating in the country’s free trade zones saw 20% less investment than during the same period last year.

 

Investors from the United States accounted for 44% of FDI during the first quarter of this year, followed by Spain, which accounted for 14.5%.

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  • grammar nazi

    “The difference in quarterly [foreign direct investment] is largely a result of a decline in the real estate sector…,” said Gabriela Llobet, CINDE director general.

    Well, let’s see, I can subtract and do percentages:

    “During the first quarter of this year, foreign investment totaled $483 million, compared to $925 million during the same period in 2013.”

    This is a decease of $442 million.

    “The real estate sector reached a record $377 million during the first quarter of last year, but totaled just $218 million in the first quarter of this year…”

    This is a decline of $159 million, that is, about 36% of the total decrease mentioned above. Thus the difference in FDI is largely (64% 100%-36%) a result of a declines sectors OTHER than real estate. Wonder what those would be. Wonder why our leaders can’t do grade 6 math.

    • http://insidecostarica.com/ Timothy Williams

      Great point, Grammar Nazi, one we should have caught and called out CINDE on ourselves. We may follow up.

    • toolman78

      I wonder if those figures take into account when companies pull up stakes and leave as a negative investment.

    • Ken Morris

      Yeah, I always like it when someone does the math too. Thanks.

      At the same time, the decline in real estate investments does seem to be a component, and when paired with a story in last Sunday’s La Nación about the over supply of higher-priced real estate, makes sense. I bet most FDI in real estate is at the higher end, when the local market needs more in the middle and low end.

  • jimbo97

    I was going to invest in Puerto VIejo until the government came through and started to tear down oceanfront buildings. Give people a concession to build 51-200 meters from the coast then change your mind? I’ve seen the same places for sale for years now. Who wants to invest their hard earned money where the government and police are corrupt? Invest where the government may or may not come through a plow down the whole town “just because”. Be it right or wrong, the perception to investors (at least in Talamanca) is instability. I’ll pass…

  • duke ster

    Yeah, and this is just the beginning as the world moves rapidly into the most severe depression in modern history. And any investment should be done where the rules don’t change on a whim as Jimbo 97 points out. The fact is that Costa Rica turns out to not be the safe haven so many Gringos thought it would be when the SHTF. After all, you are in a country which is overwhelmingly catholic and if you really do your homework you will learn that the pope is a Jesuit, Do your homework on the “Jesuit code” and you will shockingly learn just who he really is. There is no safe haven and you are living in a country where the populace HATES YOU!! Gringo. On another sobering note–check out THE FORMER chief counsel( top lawyer) to the WORLD BANK on”YOU TUBE” Karen Hudes. This is not a low level person , She is claiming that the world is controlled by a race of beings who are not human. Cone headed people ( like Pharaoh Akenhaten and wife Nefertti ( who had elongated heads). Super intelligent beings who have been on earth a long time.( Skulls found everywhere) Of course Karen Huden is put out there as a “whistleblower” but you have to realize that if “they” didn’t want this information out there… well do I have to be so blunt? Are you asleep? Of course she is giving out the information “they” want her to expose. What she is not aware of is that this race of intelligent beings who’s offspring cannot reproduce are actually spoken of in the Bible in Genesis chapter 6–it’s all there. These are Nephlim or offspring of the “fallen angels” which are fully explained in genesis 6. There were GIANTS in the land in those days–AND AFTER!!!! The Hebrew soldiers were supposed to wipe out all inhabitants of caanan but didn’t do as God commanded. OH God was a bad God to have the Hebrews destroy women and children? NO– These were offspring of the fallen angels and were Giants-and horrible beings- the Hebrew spies returned to camp after spying ahead and reported that “we were as grasshoppers in their sight” THEY WERE HUGE!!! offspring of fallen angels and they are still here ( not as Giants but as nephlim–where do you think the flying saucers come from? There are NO ALIENS from other planets!!! They have super intelligence because they brought it from Heaven. There were different ages in the earth. There were flying saucers here for thousands of years, and the nephlim continue to mate with the “daughters of man” Check out genesis 6 and learn the fantastic truth!!!! Why did MIT (mass. institute of technology) do a study on alien abductions? because the stories have always been the same=regardless of social status etc. They are true –all except the “aliens” are nephlim who survived the flood.

  • Costa Rica-il

    We have a wide range of real estate investment opportunities in the
    short medium and long term profitability, Ask the Specialists of the
    beautiful Costa Rica. Costaricaisrael.com Team

  • El Torito

    Another disincentive for foreign investment has to do with the current labour laws in this country. Because it is financially prohibitive to dismiss an unsuitable worker, ineptitude, inefficiency, and theft on the part of staff are the bane of many employers’ existences here. Left unchecked, as it is, this facilitates incompetence and corruption throughout the country which impedes progress. A simple change in the labour laws would have a tremendously positive impact on this nation which would surely gain the attention of foreign investors.

    • Iddy Yutt

      To Summarize : The people and country are SHIT.

      • Michael Clarkson

        This place is a sewer.

  • Iddy Yutt

    Costa Rica is finished. It’s over guys. Move on…….

  • Michael Clarkson

    The word has been out for years, people have have gotten screwed here have been spreading the word for years, people are sick of getting robbed in this country, like they say if you want to make a million in Costa Rica bring two. The CR government has been operating like a corporate mafia and they killed the goose that laid the golden egg. I tell everyone I come across do not invest a dime in this country, there are so many countries in the world and in Latin America that are kind to the investor.