Thanks to an effective partnership between the public and private sectors, Costa Rica has emerged as Central America’s innovation leader.
Last year, service sector exports, which include call centers, shared services, medical technology, information services and entertainment and digital technologies, were higher (US$5.560 billion) than agricultural exports (US$4.064 billion) for the first time, according to the Foreign Trade Corporation of Costa Rica (PROCOMER).
“These results reflect the positive impact of world-class companies on corporate sector practices and the impact of innovation policies on research and development capabilities,” Minister of Foreign Trade Anabel González said. “We have a good foundation to continue developing and diversifying based on innovation.”
“This shows Costa Rica has achieved success [by getting] multinational companies to establish themselves in the country and domestic companies to integrate themselves into chains with global value,” González added.
In 2012, PROCOMER created the Market Place website, designed to increase and facilitate trade for small and medium-sized companies and to develop local industries in the service sector.
Upon registering on Market Place, Costa Rican entrepreneurs can find foreign customers.
“This tool also generates other benefits, such as knowledge and technology transfers, higher technical skills and quality, the promotion of international certifications and more added value for exports,” said PROCOMER’s Value Chain Director for Exports, Rolando Dobles.
An example is Electroplast, a company that has been producing plastics since 1985 and today employs 100 workers.
As a result of initiatives by PROCOMER, the Ministry of Foreign Trade and the Costa Rican Coalition for Development Initiatives (CINDE), Electroplast, which specializes in high-precision injection molding, now supplies large, multinational companies.
“This step allowed us to sell to a multinational company for the first time in 2012,” said Óscar Ramírez, Electroplast’s owner.
Electroplast exports 99% of its products, with more than half of its production directed to the medical devices sector. The company has experienced an annual average sales increase of 10%.
CINDE also attracts foreign investment in Costa Rican’s technology sector by attending and organizing international forums such as the Life Sciences Forum Costa Rica, which took place in March.
The forum brought together more than 400 representatives from leading companies in the medical industry, suppliers and international experts from Latin America, United States, Puerto Rico and Italy.
Since authorities started efforts to position Costa Rica internationally in 1984, 51 multinational companies, including six of the 20 leading companies of manufacturing technology in the medical sector, have established offices in the country.
“In the past five years alone, more than 25 new companies in the manufacturing sector of high-tech medical devices have established offices in Costa Rica, and exports [have doubled],” said Gabriela Llobet, CINDE’s general director. “This allows us to visualize a very dynamic landscape for the next few years.”
The country’s geographical location and high educational level of the population are determining factors why companies choose Costa Rica over other countries, according to a study by EvaluateMedTech for CINDE.
Costa Rica’s educational system ranks 23th in the world and tops Latin America, according to the Global Competitiveness Report 2011-2012 of the World Economic Forum.
“Today, we compete directly with countries with very strong industry throughout the world, such as India, Poland, Ireland and Malaysia,” Llobet said. “We also have a number of competitors in the region that we have significantly exceeded.”
Recently, Volcano Corp. – a company that manufactures medical devices – chose Costa Rica for its first plant outside the United States, investing more US$40 million, according to CINDE.
“After entering the Costa Rican market with long-term expectations, we can take advantage of the qualified talent in the country and its proximity to the United States, enabling us to significantly increase our production rate,” said David Sheehan, the company’s chief operating officer.