CINDE Celebrates Approval of the Bill of Law to Strengthen Investment Attraction Outside the Greater Metropolitan Area
- The purpose of the new law is to open new enterprises outside the GMA under the free-trade zone mode to generate formal employment opportunities and production chains throughout the country.
- Enterprises involved in agricultural supplies, sustainable adventure parks, and health service centers may join the Free Trade Zone Program (FTZ).
- The FTZ is an incentive that makes it possible to offset country competitiveness gaps in relation to other nations and developed countries and also be in line with WTO and OECD parameters that have socio-economic studies to measure their return on investment.
San José, April 27, 2021. CINDE
, the investment promotion agency in Costa Rica, celebrated the approval of Bill of Law 22607 known as the “Law to Strengthen Territorial Competitiveness to Promote Attracting Investment Outside the Greater Metropolitan Area (GMA).”
The initiative establishes 11 new incentives to improve territorial competitiveness, streamline processes, and open up the possibility so sectors
with great potential outside the GMA, such as Agroindustry, the Food Industry, Light Manufacturing, Tourism Infrastructure, and Services are able to develop in the county in those regions where close to 49% of the population in the country resides.
This new investment project promotion applies both to domestic companies and foreign companies that set up their operations in counties located outside the GMA under the Free Trade Zone model to be able to promote the creation of formal employment and quality jobs in the different regions in the country.
The Free Trade Zone Program has been a proven model to stimulate development by generating employment and productive reactivation and chains. For every $1 of tax incentive, the country receives $2.43 in return. In addition, multi-national companies in the sector generated more than 22,000 jobs in the country in 2021.
Margarita Umaña, the Planning and Strategic Manager on the CINDE team in charge of technical labor and assessment for the project, commented, “we would like to thank the Legislative Assembly for reaching an agreement and approving this bill of law that is so important for the country and that helps to decrease gaps between the regions inside and outside the GMA. This leads employment opportunities to regions that have extremely high unemployment rates and that need a transformation of talent.”
The Law to Strengthen Territorial Competitiveness to Promote Attracting Investments Outside the GMA also represents a window of opportunities for production chains of more than 11,000 Costa Rican vendors that are selling more than $2.323 million to companies that are installed in the program.
This will also stimulate the generation of employment for all types of profiles, running from people with schooling to professionals; it will also promote new skills for transforming talent and reskilling.
“Since 2013, at CINDE we have been working on strategic projects with 20 counties outside the GMA in 6 regions in the country to articulate them and create investment committees. The results, even prior to this approval, are already visible and we do not doubt that these will be empowered: the average annual employment growth over the last 5 years in CINDE companies outside the GMA is 17%, above the 13.5% within the GMA, and more than 4,400 positions have accumulated, to which more than 3,250 positions in 100% virtual mode are added as a new form of work,” Umaña added.
Currently, the regions have technical analysis input and investment guides that enhance their features to identify their main opportunities and the attractions that they have to offer to investors.
As part of the new incentives, this new law boosts and enables institutions such as INA, MICIT, ARESEP and INDER to promote actions that strengthen how their services operate in regions outside the GMA.
To apply this new law, the President of the Republic must sign it and then bylaws must be drafted. A final version is expected to be achieved in the upcoming months
CINDE is a private, nonprofit organization that, over the course of 40 years, has been committed to sustainable development and social progress in Costa Rica by attracting direct foreign investment to high value-added manufacturing and services industries that generate quality jobs, transfer knowledge, and produce links.
CINDE also works on strengthening the Costa Rican business climate to be able to encourage growth of value activities for the country, to improve local talent preparation, to generate employment, and to create greater opportunities for its population in the different communities in the country.