By maintaining political stability and implementing robust infrastructure investments alongside progressive tax incentives and focusing on innovation and sustainability, Costa Rica strengthens its appeal as a prime destination for Foreign Direct Investment (FDI). The country’s improved position in the Global Business Complexity Index demonstrates its established reduction in business barriers and enhanced environment for international companies.
Improving Competitiveness Through Simplicity
Costa Rica’s ranking of 58th in the Global Business Complexity Index 2025, down from 51st in 2024 and 45th in 2023, highlights a noteworthy trend: Business operations in the country are becoming simpler to conduct. The TMF Group’s index assesses business complexity by analyzing 250 indicators in 79 jurisdictions, which account for 93% of global GDP and 88% of net global foreign direct investment flows. The assessment of foundational business processes, including company incorporation and payroll management, along with benefits administration and regulatory compliance, establishes this index as a dependable measure for global market access evaluation.
The regular decline in complexity rankings proves that Costa Rica is successfully advancing its business environment through meaningful reforms. Through streamlining bureaucratic processes, Costa Rica creates a business-friendly environment that attracts foreign enterprises and meets global investment standards.
Digitalization and Regulatory Streamlining
The digital transformation initiatives in Costa Rica have played a key role in advancing its business environment. The government’s introduction of digital solutions for tax submissions and permit processing has greatly simplified administrative operations for domestic and international firms. The reforms achieve operational setup speed reductions while simultaneously improving transparency and accountability.
The streamlined incorporation procedures now enable foreign investors to access the market more rapidly. Improved collaboration between institutions like PROCOMER and the Ministry of Economy, Industry, and Commerce (MEIC) has resulted in predictable business timelines and reduced regulatory obstacles.
Expanding Free Trade Zones and Strategic Corridors
The free trade zone (FTZ) system in Costa Rica stands out as one of the top incentives available to foreign investors. Investors benefit from multiple tax advantages within these zones, such as no income tax for specified years, being free from import duties on capital goods, and diminished social security payments. The nation has more than 400 companies participating within its free trade zone regime as of 2024, which create jobs for over 100,000 people while contributing significantly to national exports.
FTZ expansions outside the Central Valley are driving regional development and market diversification. The decentralization of economic activities in Costa Rica helps reduce urban congestion while balancing regional disparities. Investments in trade infrastructure support the expansion through new road corridors alongside improved port facilities and airport modernization.
Key infrastructure projects include:
- Route 32 receives upgrades to create a direct connection between San José and the Caribbean port of Moín.
- The San Carlos Highway enhances transportation links throughout northern areas.
- Efficient international trade operations depend on the modernization process of Moín and Caldera ports.
Costa Rica’s place in the Global Business Complexity Index shows better performance because of strategic national efforts that promote economic resilience and better global trade network connections.
Sustainability as a Cornerstone of Economic Policy
The leadership of Costa Rica in sustainability practices creates a distinctive advantage for attracting foreign direct investment. The nation produces more than 98% of its electricity through renewable sources while pursuing ambitious carbon neutrality targets. Companies entering the market will face more complicated operations when introducing sustainable practices, but these practices match the Environmental, Social, and Governance standards used in ESG investments.
Global investors now prioritize sustainable infrastructure alongside clean energy options and eco-friendly supply chain practices. Costa Rica’s commitment to environmental sustainability protects its biodiversity while establishing it as a progressive business hub, which boosts its standing in the Global Business Complexity Index.
Security and Transparency Measures
Many people fail to notice that Costa Rica’s business environment benefits from both a solid institutional framework and democratic governance. Costa Rica maintains its position as one of Latin America’s most stable democracies, through its minimal corruption levels and strong judicial independence and rule of law. These factors provide investors with a secure and predictable environment that reduces typical political risks found throughout the region.
The government’s implementation of stronger border control measures, enhanced customs operations, and anti-money laundering policies demonstrates its commitment to increasing transparency. These efforts build international partner trust and boost adherence to global standards, which leads to better results in the Global Business Complexity Index for the country.
Talent Availability and Labor Challenges
Costa Rica maintains a skilled workforce with strong representation in STEM fields, but faces talent deficits in certain specialized areas. The influx of multinational corporations into the life sciences, medical devices, and technology sectors has generated a competitive labor market in the country where demand exceeds supply.
Public-private partnerships are funding upskilling programs along with bilingual education and technical training to address this issue. The National Institute of Learning (INA), along with public universities, continues to enhance its educational programs to address industrial requirements. To maintain a favorable ranking in future Global Business Complexity Index editions, companies must address existing talent shortages.
Currency Appreciation: A Double-Edged Sword
Costa Rica retains numerous benefits but also encounters obstacles that threaten its competitive position. The recent appreciation of the Costa Rican colón (CRC) stands out as the primary financial challenge. The increased strength of the currency results in higher export prices and elevated operational costs for businesses that need to change U.S. dollars into colones for their local payments.
Export-focused businesses located in free trade zones stand to face tighter profit margins and lose competitive ground against other Latin American markets due to this economic shift. Policymakers should track exchange rate movements while exploring methods to maintain Costa Rica’s status as an economical manufacturing and service hub.
Connectivity and Transport Efficiency
The logistics network of Costa Rica is becoming better, yet continues to experience operational inefficiencies. The two major seaports of Costa Rica, located at Moín in Limón on the Caribbean coast and Caldera in Puntarenas on the Pacific coast, serve vital roles in trade operations. The logistics network continues to struggle with ongoing capacity constraints and delays.
Costa Rica maintains a sophisticated air transport infrastructure, which includes Juan Santamaría International Airport and Daniel Oduber Quirós International Airport, to provide international passenger and air cargo services. Costa Rica needs to allocate more resources to road network development and customs modernization to manage increasing logistics demands.
A Resilient Platform for Investment
The steady rise of Costa Rica in the Global Business Complexity Index stems from purposeful initiatives to streamline business operations, alongside efforts to boost economic sustainability and build investor trust. Costa Rica stands as the leading Latin American choice for foreign investors through its distinctive mix of environmental leadership and strong institutions, alongside its political stability and trade openness.
The nation maintains competitive resilience for international business through its proactive reform strategies and infrastructure development despite enduring talent shortages and logistical inefficiencies.