As the Costa Rican semiconductor ecosystem consolidates, experts say it is time to recalibrate the Costa Rican investment attraction strategy. Costa Rica has established itself as one of Latin America’s most vibrant semiconductor ecosystems in recent years. More than five thousand direct jobs have been created, and there are now more than six hundred local suppliers in the country’s semiconductor value chain. But to continue adding value, Costa Rica must ascend the global value chain and assert itself as a true regional manufacturing hub. In the context of a rapidly changing semiconductor industry, marked by new competitors, technological shifts, and geopolitical alignments, industry leaders are calling for a redefinition of Costa Rica’s approach to attracting semiconductor investments through a renewed investment-attraction strategy.
Experts believe that if the Costa Rican investment attraction strategy does not adapt to these new dynamics, the country will risk losing competitiveness and long-term FDI that no longer aligns with its economic or technological development. According to Federico Quesada Chaves, ECA’s Director and an economist, the recent closures of multinational semiconductor subsidiaries are the catalyst for rethinking Costa Rica’s strategy in the sector. “It is a strong alarm signal for a semiconductor ecosystem in Costa Rica that we have been building, to continue betting on the productive linkages with the national industry and the transfer of technology and know-how to be cross-cutting elements in the country’s development,” said the expert in an interview with UNIVERSIDAD ESTATAL A DISTANCIA.
The strong foundations of the Costa Rican semiconductor ecosystem
Costa Rica’s semiconductor ecosystem has taken shape over two decades, strengthening its role as a trusted haven for high-tech investment and advanced manufacturing. During this period, the Costa Rican business climate, institutions, and labor pool have been built as elements of attractiveness for this industry. Currently, according to data from the Costa Rican Foreign Trade Promotion Agency (PROCOMER), around 5,000 direct jobs have been generated, and more than six hundred Costa Rican suppliers serve the international technology industry, many with capabilities at the global level.
Last year, the Ministry of Foreign Trade (COMEX) presented its Semiconductor Roadmap, a comprehensive strategy to position Costa Rica as a regional hub. The long-term plan, with a horizon to 2040, envisions a multi-faceted approach to attract and retain semiconductor projects, including human talent development, regulatory improvements, and fiscal incentives. However, as Quesada explains, the rapid reconfiguration of the global semiconductor industry may call for changes to the roadmap.
The challenge of the changing global semiconductor industry
Semiconductor supply chains are undergoing the largest reconfiguration of the last century, as countries and corporations seek to move production closer to home, reduce costs, and shorten supply lines. Governments and technology companies are investing billions of dollars in semiconductor manufacturing worldwide, from the United States (CHIPS and Science Act) and Japan to the European Union and China. The semiconductor sector has also seen the emergence of new competitive players in Asia and Eastern Europe, offering compelling incentives to attract projects and investments.
According to Quesada, Costa Rica can benefit from this global shift and position itself as a natural destination for semiconductor companies looking to move closer to American markets. “Emerging economies in Asia and Eastern Europe, with less stringent environmental and labor regulations, are displacing some of these established leaders in the sector. Costa Rica will have to be prepared to position itself and face this change: it must anticipate it, strengthen its technological base, and plan what it wants to be in this new industrial revolution,” he added.
This new context challenges Costa Rica to move to a more holistic semiconductor investment attraction strategy—one that is not only about promoting FDI but also about building the country’s own innovation, technology, and industry. Costa Rica can no longer simply aim to attract subsidiaries; instead, the goal must be to attract research, design, and higher-value-added operations that contribute to a more advanced and sustainable Costa Rican investment attraction strategy.
The challenges facing Costa Rica in the global semiconductor industry
The semiconductor roadmap is an important step in planning for the country’s future role in the industry, but it must be updated as the context changes. Faced with global supply chain reconfigurations and a rapidly changing international semiconductor landscape, Costa Rica must deal with a number of key challenges that will define the next stage of its strategy for economic development. In this regard, the economist at UNIVERSIDAD ESTATAL A DISTANCIA emphasizes four key points that Costa Rica must focus on:
- Productive Linkages: Companies located in Costa Rica, especially multinational corporations, must generate local value. Through supplier development programs, technology transfer, and innovation partnerships, Costa Rica must integrate itself into a wider value chain that allows it to position itself as a center of excellence in a specific area. Integration in a broader regional ecosystem is key to the sustainability and growth of Costa Rica.
- Technology Transfer: FDI is not only about job creation but also about innovation and research. R&D and innovation need to be fostered through the creation of innovation clusters, links between academia and the productive sector, and technology centers focused on new materials, chip design, artificial intelligence, and other core technological areas that will power Costa Rica’s next-generation industries.
- Specialized Talent: Costa Rica must have the skilled and specialized talent to support industries of the future. Universities, technical schools, and the private sector must work together to expand talent and encourage professionals in engineering, data science, materials, advanced manufacturing, and related fields. The creation of Costa Rican human talent is the most important tool in the strategy.
- Strategic Adaptability: Costa Rica must be agile and able to quickly identify and seize opportunities in a shifting global industrial landscape. A clear focus on regulations, attracting talent, and positioning in areas of global strength will be key to Costa Rica’s ability to compete in a changing global context.
To successfully navigate this path and remain relevant, Quesada warns that Costa Rica’s investment attraction strategy needs a profound update that prioritizes the rethinking of productivity linkages with the Costa Rican productive sector. Experts are particularly concerned that companies operating in the country may no longer serve as generators of productivity linkages with the national industry and may not support the strengthening of Costa Rica’s own knowledge.
In this new industry, Costa Rica must prioritize both attracting direct investment and strengthening the competitiveness of its semiconductor industry and its research and development ecosystem. By generating effective and strategic links with its own productive sector, the country will be able to ensure that every dollar of FDI invested in Costa Rica will not only generate high-quality employment but also contribute to building a more sustainable and inclusive economy and technological leadership for Costa Rica. In a year in which multinational companies are ending projects and uprooting plants from Costa Rica, the Costa Rican investment attraction strategy must be urgently rethought if the country wants to continue consolidating itself as a hub for high-tech investment.