GOVERNMENT

Costa Rica is a democratic republic.

 Costa Rica has long emphasized the principles of democracy and respect for human rights. The country's political system has steadily developed, maintaining democratic institutions and an orderly, constitutional scheme for government succession. Several factors have contributed to this trend, including enlightened leadership, comparative prosperity, flexible class lines, educational opportunities that have created a stable middle class, and high social indicators. Also, because Costa Rica has no armed forces, it has avoided military involvement in political affairs, unlike other countries in the region.

ECONOMY

GDP (2006): $20.77 billion.
Per capita income (2006): $5,100. (PPP $12,000, 2006 est.)
Unemployment (2006 est.): 6.6%.
Currency: Costa Rica Colon (CRC).
Natural resources: Hydroelectric power, forest products, fisheries products.
Agriculture (8.6% of GDP): Products--bananas, pineapples, coffee, beef, sugar, rice, dairy products, vegetables, fruits and ornamental plants.
Industry (31% of GDP): Types--electronic components, food processing, textiles and apparel, construction materials, fertilizer, medical equipment.
Commerce, tourism, and services (60.4% of GDP): Hotels, restaurants, tourist services, banks, and insurance.
Trade (2006 est.): Exports--$7.931 billion: bananas, pineapples, coffee, melons, ornamental plants, sugar, textiles, electronic components, medical equipment. Major markets--U.S. 42.6%, Hong Kong 6.9%, Netherlands 6.4%, Guatemala 4.2%. Imports--$10.88 billion: raw materials, consumer goods, capital equipment, petroleum. Major suppliers--U.S. 41.3%, Japan 5.6%, Venezuela 4.8%, Mexico 4.8%, Ireland 4.3%, Brazil 4.2%, China 4.2%.

FLORA AND FAUNA

Costa Rica is one of the most biologically wealthy nations in the world; even though it is one of the smallest countries in the world, Costa Rica supports over 5% of the world's biodiversity.  From the coast to an altitude of about 900 m (3,000 ft) are tropical forests and savannas; oaks and chaparrals are found between 2,070 and 3,050 m (6,800 and 10,000 ft); and subandean and subalpine flora characterizes the highest mountains. The dense tropical forests contain rich stands of ebony, balsa, mahogany, oak, laurel, campana, and cedar. Plant life is abundant. The country has more than 1,000 species of orchids.

Most of the wild mammals common to South and Central America, such as jaguar, deer, puma, and varieties of monkeys, are found in Costa Rica. There are over 600 species of birds and 130 species of snakes and frogs; fish and insects are plentiful.

ECONOMIC RESOURCES

After four years of slow economic growth, the Costa Rican economy grew at nearly 5% in 2006. Compared with its Central American neighbors, Costa Rica has achieved a high standard of living, with a per capita income of about U.S. $5,100, and an unemployment rate of 6.6%. During 2006 the annual inflation rate dropped into the single digits (9.43%) for only the third time in the last 28 years; proof that the Costa Rican Government is seriously trying to reduce its large fiscal deficit.

Costa Rica's major economic resources are its fertile land and frequent rainfall, its well-educated population, and its location in the Central American isthmus, which provides easy access to North and South American markets and direct ocean access to the European and Asian Continents. One-fourth of Costa Rica's land is dedicated to national forests, often adjoining picturesque beaches, which has made the country a popular destination for affluent retirees and eco-tourists.

Costa Rica used to be known principally as a producer of bananas and coffee, but pineapples have surpassed coffee as the number two agricultural export. In recent years, Costa Rica has successfully attracted important investments by such companies as Intel Corporation, which employs nearly 2,000 people at its $300 million microprocessor plant; Proctor and Gamble, which employs nearly 1,000 people in its administrative center for the Western Hemisphere; and Hospira and Baxter Healthcare from the health care products industry. Manufacturing and industry's contribution to GDP overtook agriculture over the course of the 1990s, led by foreign investment in Costa Rica's free trade zone. Well over half of that investment has come from the United States. Dole and Chiquita have a large presence in the banana and pineapple industries. Two-way trade between the U.S. and Costa Rica exceeded $7.9 billion in 2006.

Costa Rica has oil deposits off its Atlantic Coast, but the Pacheco administration (2002-2006) decided not to develop the deposits for environmental reasons. The country’s mountainous terrain and abundant rainfall have permitted the construction of a dozen hydroelectric power plants, making it largely self-sufficient in electricity, but it is completely reliant on imports for liquid fuels.

Costa Rica has the potential to become a major electricity exporter if plans for new generating plants and a regional distribution grid are realized. Mild climate and trade winds make neither heating nor cooling necessary, particularly in the highland cities and towns where some 90% of the population lives.

U.S. - COSTA RICAN RELATIONS

The United States and Costa Rica have a history of close and friendly relations based on respect for democratic government, human freedoms, free trade, and other shared values. The country generally supports the U.S. in international fora, especially in the areas of democracy and human rights.

The United States is Costa Rica's most important trading partner. The U.S. accounts for almost half of Costa Rica's exports, imports, and tourism, and more than two-thirds of its foreign investment. The two countries share growing concerns for the environment and want to preserve Costa Rica's important tropical resources and prevent environmental degradation.    

For decades, Peace Corps Volunteers have provided technical assistance in the areas of environmental education, natural resources, management, small business development, microfinance, basic business education, urban youth, and community education.