Costa Rica transportation is in Need of Financial Help.

Costa Rica’s roads are infamous for reasons they’d rather not be: potholes, poor maintenance, blind curves. It’s no surprise, therefore, that a new study by the General Comptroller for the Republic (of Costa Rica) found that the funds designated for roads, ports, and trains are insufficient. In fact, between 2000 and 2006, Costa Rica spent a mere 0.83 percent of its GDP (Gross Domestic Product) on transportation.

To translate percentages to hard numbers, Abel Pacheco’s administration spent less than ¢101,26 billion ($204 million) yearly on airports, sea ports, the urban train and roads, combined. In 2007, during Oscar Arias’s administration, that number dipped even lower, to just 0.63 percent of the GDP, or ¢90.71 billion ($183 million).

These funds do little to help maintain existing infrastructure, and even less to improve, helping “to bring the country out of an accumulated [transportation] gap that resulted from little effective investment in this type of infrastructure.” Indeed, though Costa Rica is the wealthiest country in Central America (according to GDP), it has arguably the worst roads, a constant complaint for visitors and tourists.

“Your [Costa Rica's] road network is not very good, why is that? I don’t know, and I don’t dare have an opinion. I remember when I went to Monteverde. You have a problem with that,” Panamanian Tourism Minister, Rubén Blades, echoed this sentiment, during a recent visit with his Costa Rican counterpart, Carlos Ricardo Benavides. He went on to urge that, as a country with a strong reputation for tourism, Costa Rica should require investors to include infrastructure development in their budgets.

Backing up his words, the Economic Commission for Latin America (CEPAL) found that Latin America, as a whole, spends less than 2 percent of their annual GDP on infrastructure. Costa Rica, at just 0.63 percent in 2007, falls far below this average. The problems don’t stop there, however, as CEPAL states that Latin America, including Costa Rica, actually needs to invest approximately 4 to 6 percent of its annual GDP, or 6.5-9.5 times what the country currently dedicates to maintaining and improving its infrastructure.

In addition to too little investment, the Comptroller also cites the destination of invested money as a problem. The majority of Costa Rica’s transportation budget goes toward roads, and leaves alternative methods, like the train, in the proverbial dust. For example, in the 2007-2010 budgeted period, the Costa Rica government has planned to invest 91 percent of its infrastructure budget in roads, only dedicating 6.91 percent to sea ports, 1.39 percent to Costa Rica airports, and a meager 0.09 percent to trains. Over the course of four years, invested funds will amount to no more than 1.44 percent of the GDP, and only if Arias’s administration takes on all the projects outlined in the National Development Plan.

To make matters even worse, the Comptroller estimated that current projects will cost approximately ¢203 billion ($410 million), 27 percent of which do not have “technical, financial, economic, social, [or] environmental viability.” One such unbacked project is the renovation of Liberia’s Daniel Oduber Quirós airport, whose improvements have already been delayed. Clearly, the concerns of the Comptroller, in conjunction with CEPAL, are merited, and Costa Rica needs to reevaluate its infrastructure dollars and place more emphasis on maintenance and alternative transportation to support its commuting public as well as the millions of tourists that Travel to Costa Rica each year.

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Filed under: Travel on July 17th, 2008