Background Notes: Costa Rica

PA/PC Source: Office of Public Communication, Bureau of Public Affairs Date: Jun 15, 19926/15/92 Category: Country Data Region: Caribbean Country: Costa Rica Subject: Travel, History, International Organizations, Trade/Economics [TEXT] Official Name: Republic of Costa Rica

PROFILE

Geography
Area: 51,032 sq. km. (19,652 sq. mi.), slightly smaller than West Virginia. Cities: Capital--San Jose (metropolitan population 890,434). Other major cities--Alajuela (34,556), Limon (33,925), Golfito (29,043). Terrain: A rugged, central massif separates eastern and western coastal plains. Climate: Tropical and subtropical.
People
Nationality: Noun and adjective--Costa Rican(s). Population: 3 million. Annual growth rate: 2.5%. Density: 57 sq. km. (147 sq. mi.). Ethnic groups: European (including a few mestizos), 96%; black, 3%; indigenous, 1%. Religion: Roman Catholic 95%. Language: Spanish, with Jamaican dialect of English spoken around Puerto Limon. Education: Years compulsory--6. Attendance--nearly 100%. Literacy--93%. Health: Infant mortality rate--15/1,000. Life expectancy--men 68 years; women 72 years. Work force (1 million, 1990): Services and government--38%. Agriculture--32%. Industry and commerce--25%. Banking and finance--5%.
Government
Type: Democratic republic. Independence: September 15, 1821. Constitution: November 9, 1949. Branches: Executive--president (head of government and chief of state) elected for one 4-yr. term, two vice presidents, cabinet (20 ministers). Legislative--57-deputy unicameral Legislative Assembly elected at 4-yr. intervals. Judicial--Supreme Court of Justice (22 magistrates elected by Legislative Assembly at 8-yr. intervals). Subdivisions: 7 provinces divided into 80 cantons subdivided into districts. Political parties: Social Christian Unity Party (PUSC), National Liberation Party (PLN), United Peoples Party (PU), Costa Rican Socialist Party (PSC). Suffrage: Obligatory over age 18. Central government budget (1990): $1 billion. Defense: Costa Rica has no army. Holiday: Independence Day, September 15. Flag: Two blue horizontal stripes top and bottom, two white inner stripes, and a wide, red central band with the national coat of arms.
Economy
GDP (1991): $5.6 billion. Real growth rate (1991): 1%. Per capita income (1991): $1,810. Inflation (1991 consumer price index change): 25%. Natural resources: Hydroelectric power. Industry (22% of GDP): Types--food processing, textiles and clothing, construction materials, fertilizer. Agriculture (19% of GDP): Products--bananas, coffee, beef, sugarcane, grain. Trade (1991): Exports--$1.6 billion: bananas, coffee, beef, sugar, cocoa. Major markets--US 39%, Central America 13%, Germany 9%. Imports--$1.8 billion: manufactured goods, machinery, transportation equipment, chemicals, fuel, food- stuffs, fertilizer. Major suppliers--US 40%, Japan 12%, Central America 8%. Average exchange rate: 137 colones=US$1 (1991). Fiscal year: Calendar year. US economic aid received (1991): $52 million. Debt service charges as % of exports: 41% in 1990.

PEOPLE AND HISTORY

Unlike most of their Central American neighbors, Costa Ricans are largely of European rather than mestizo descent, and Spain is the primary country of origin. The indigenous population today numbers no more than 25,000. Blacks, descendants of 19th-century Jamaican immigrant workers, constitute a significant English- speaking minority of about 30,000, concentrated around the Caribbean port city of Limon. In 1502, on his fourth and last voyage to the New World, Christopher Columbus made the first European landfall in the area. Settlement of Costa Rica began in 1522, and for nearly 3 centuries the region was administered as part of the Captaincy General of Guatemala, under a military governor. The Spanish optimistically called the country "Rich Coast," but the name proved inaccurate. Finding little gold or other valuable minerals in Costa Rica, the Spanish turned to agriculture. The small landowners' relative poverty, the lack of a large indigenous labor force, the population's ethnic and linguistic homogeneity, and Costa Rica's isolation from the Spanish colonial centers in Mexico and the Andes all contributed to the development of an autonomous and individualistic agrarian society. This egalitarian tradition continued even after introduction of banana and coffee cultivation in the 19th century led to the accumulation of wealth which resulted in class distinctions. In 1821, Costa Rica joined other Central American provinces in a joint declaration of independence from Spain. Although the newly independent provinces formed a federation, border disputes broke out among them. Costa Rica's northern Guanacaste Province was annexed from Nicaragua in one such regional dispute. In 1838, long after the Central American federation ceased to function in practice, Costa Rica formally withdrew and proclaimed itself sovereign. The modern era of peaceful democracy in Costa Rica began in 1889, in a remarkable change of political power, considering the region's turbulent history and conditions. The elections of 1889, considered the first truly free and honest ones in the country's history, began a trend maintained with only two lapses: in 1917- 18, Federico Tinoco ruled as a dictator, and in 1948, Jose Figueres led a popular revolution in the wake of a disputed presidential election. With more than 2,000 dead, the revolution was the bloodiest event in Costa Rican history, but the victorious junta drafted a constitution guaranteeing free elections with universal suffrage and the abolition of the army. Figueres became a national hero, winning the first election under the new constitution. Since that time, Costa Rica has held 11 presidential elections. Only twice, in 1974 and in 1986, was the candidate of the party in power elected. The next elections are scheduled for February 1994.

GOVERNMENT

Costa Rica is a democratic republic with a strong system of checks and balances. Executive responsibilities are vested in a president who, though somewhat more constrained than most Latin American heads of state, is without question the center of power. The president and 57 Legislative Assembly deputies are elected for 4-year terms. A constitutional amendment approved in 1969 limits both the president and the deputies to one term, although a deputy may be returned to the assembly after sitting out a term. The electoral process is supervised by an independent Supreme Electoral Tribunal, a commission of three principal magistrates, and six alternates selected by the Supreme Court of Justice. Judicial power is exercised by the Supreme Court of Justice, composed of 22 magistrates selected for 8-year terms by the Legislative Assembly, and subsidiary courts. A constitutional chamber of the Supreme Court, established in 1989, reviews the constitutionality of legislation and executive decrees and all habeas corpus warrants. The country's seven provinces are headed by governors appointed by the president, but they exercise little power. There are no provincial legislatures. Autonomous state agencies enjoy considerable operational independence; they include the nationalized commercial banks, the state insurance monopoly, and the Social Security Agency.
Principal Government Officials
President--Rafael Angel Calderon Fournier Foreign Minister--Bernd Niehaus Quesada Ambassador to the United States--Gonzalo J. Facio Segrada Ambassador to the OAS--Carlos Pereira Garro Ambassador to the United Nations--Cristian Tattenbach Yglesias Costa Rica maintains an embassy in the United States at 1825 Connecticut Avenue, NW, Suite 211, Washington, DC 20009 (tel. 202-234-2945).

POLITICAL CONDITIONS

Throughout its history, Costa Rica's political system has contrasted sharply with those of its neighbors. The nation has steadily developed and maintained democratic institutions and an orderly, constitutional scheme for government succession. Several elements have contributed to this situation, including educational opportunities, enlightened government leaders, comparative prosperity, flexible class lines, and the absence of a politically intrusive military. In the elections of 1990, Rafael Angel Calderon Fournier, of the Social Christian Unity Party (PUSC), was elected to succeed Oscar Arias Sanchez of the National Liberation Party (PLN) as Costa Rica's president. The private-sector oriented and populist PUSC also won a slim majority in the Legislative Assembly--29 of 57 seats. The PUSC is aligned to Christian Democratic and conservative parties in the Western Hemisphere and Europe. The PLN has been the dominant party in Costa Rica since 1948. It is a social democratic party affiliated with the Socialist International. The 1990 elections marked the first time in over 30 years that the PLN lost control of the Legislative Assembly. Overall, Costa Rican governments have swung from moderately conservative to moderately progressive as the PLN and various anti-PLN coalitions have tended to alternate control of the presidency. This pattern was broken in 1974 and 1986, when a PLN candidate succeeded a PLN incumbent. Three minor parties are represented in the 1990-94 Legislative Assembly. Costa Rica has not been insulated from regional conflicts. Instability in neighboring Nicaragua and Panama in the 1980s discouraged new investment and tourism in Costa Rica. In addition, many Nicaraguans and Salvadorans sought refuge in Costa Rica, further burdening the country's educational and health facilities. In 1987, President Oscar Arias authored a regional peace plan that became the basis for the peace agreement signed by the presidents of the other Central American countries (excluding Belize and Panama). Arias' efforts earned him the 1987 Nobel Peace Prize. The Esquipulas Process, as the peace plan became known, contributed to bringing about free and open elections in Nicaragua and the subsequent end of the civil war in that country. Under President Calderon, Costa Rica continues to play a prominent role in the Esquipulas Process. The Costa Ricans have hosted negotiations between the Salvadoran Government and the Farabundo Marti guerrilla faction and are key participants in efforts toward regional cooperation on political and economic development and demilitarization.

ECONOMY

Since its economic crisis of the early 1980s, Costa Rica's economic orientation has supported structural adjustment, focusing on internal stability and growth through increasingly diversified exports. The gross domestic product (GDP) grew an average 5% since 1986, non-traditional exports increased 20%-30% annually, official unemployment fell below 6%, and inflation is relatively low. These trends slowed in 1990: growth diminished to 36%, inflation to over 25%, and government deficits increased. A debt buy-back program under the US "Brady Plan" was completed in May 1990, enabling Costa Rica to repurchase 60% of its commercial bank debt, cover interest for bonds issued in exchange for part of debt, and cover payments on debt not repurchased. Costa Rica also became the 100th member of the General Agreement on Tariffs and Trade (GATT) in 1990. The successful macroeconomic performance of the late 1980s masked serious fiscal imbalances, including a large public-sector deficit and declining international reserves. Immediately after taking office, the Calderon Administration began implementing a fiscal austerity program, including revenue increases and expenditure reductions. The programs of the International Monetary Fund, World Bank, the Inter-American Development Bank, and the US Agency for International Development in Costa Rica are aimed at maintaining stability and promoting trade and investment liberalization. The Costa Rican Government actively supports the Enterprise for the Americas Initiative (EAI) announced by President Bush in June 1990. The United States and Costa Rica signed a bilateral trade and investment framework agreement in November 1990 under the EAI as a mechanism to discuss trade and investment issues. In January 1991, the Costa Ricans joined the other Central American countries in committing to discuss the creation of a free trade zone with Mexico by 1996. Later in 1991, Costa Rica and Venezuela began discussions for a free trade arrangement. Further liberalization of Costa Rica's trade and investment regimes and greater access to foreign markets by the country's exporters would provide promising opportunities for foreign and local investors and increased prosperity for Costa Rica.

DEFENSE

The 1949 constitution prohibited the establishment of a standing army in Costa Rica. The country relies on small Civil and Rural Guard forces which patrol the borders and perform internal police functions. Costa Rica faces no serious external or internal threats and looks to the collective security provisions of the 1947 Rio Treaty for defense against external aggression. The president is the commander in chief of the public security forces. The primary organization is the Civil Guard. It is essentially a constabulary force responsible for law and order in urban areas and for land, air, and maritime border surveillance. The secondary organization, the Rural Guard, is responsible for rural police functions throughout Costa Rica's seven provinces. Both organizations fall under the Ministry of Government and Public Security.

FOREIGN RELATIONS

Costa Rica is an active member of the international community. Its record in such areas as human rights and advocacy of peaceful settlement of dispute gives it a weight in world affairs far beyond its size. The country lobbied strenuously for the establishment of the UN High Commissioner for Human Rights and was the first nation to recognize the jurisdiction of the Inter- American Human Rights Court, which is based in San Jose. Costa Rica expressed a firm commitment to the letter and spirit of the Rio Treaty. With the establishment of democratically elected governments in all Central American nations in 1990, Costa Rica was able to turn its focus from regional conflicts to the pursuit of democratic and economic development on the Isthmus. Costa Rica was instrumental in drawing Panama into the Central American development process and key to the establishment of the multinational Partnership for Democracy and Development in Central America, a partnership of the Central American nations, industrialized democracies, Colombia, Mexico, and Venezuela, and international organizations. Costa Rica broke relations with Cuba in 1961 to protest Cuban support of leftist subversion in Central America.

US-COSTA RICA RELATIONS

The United States and Costa Rica have enjoyed close and friendly relations based on mutual respect for democratic government, human freedoms, social and economic rights, and other shared values. US and Costa Rican views on foreign policy have not always coincided: Costa Rica aligned itself with other Latin American countries against the US position during the 1982 Malvinas-Falkland war and against US military operations in Grenada in 1983. Former President Arias was critical of US policy in support of the Nicaraguan Resistance. Costa Rica was among the first Latin American countries, however, to support the US-led re- establishment of democratic order in Panama in 1989 and was a firm supporter of the US position during the Persian Gulf crisis following Iraq's invasion of Kuwait in 1990. The United States and Costa Rica share a strong interest in promoting and strengthening democratic processes and institutions and enhancing free market oriented economic development in Central America and throughout the Hemisphere. The United States has responded to Costa Rica's economic needs through developmental assistance programs. The Peace Corps, with some 150 volunteers, has helped develop skills in agriculture, education, health, nutrition, and natural resources development. The US Agency for International Development works not only to support Costa Rican efforts to stabilize the economy in the short term but also to help broaden and accelerate economic growth through policy reforms and trade liberalization. Low- income farmers are being helped toward self-sufficiency, and the urban poor are aided by industrial development, family planning, and increased educational opportunities. The private sector, as the primary engine for sustained economic growth, is also supported by US assistance efforts. Many other US agencies, including the US Information Service and the Department of Agriculture, are active in Costa Rica. More than 20,000 American private citizens, mostly retirees, live in the country.
Principal US Officials
Ambassador--Luis Guinot, Jr. Deputy Chief of Mission--Robert O. Homme AID Mission Director--Ronald Venezia Consul General--Donna J. Hamilton Political Counselor--John R. Hamilton Economic Counselor--Stephen V. Noble Administrative Counselor--Robert Graninger Commercial Attache--vacant Agricultural Attache--David Young Public Affairs Officer--Louise K. Crane The US Embassy in Costa Rica is located at Calle 1, Avenida 3, San Jose (tel. 33-11-55). (###)