Costa Rica gets approval of OECD Investment Committee
San José, Tuesday, November 19, 2019. Last Friday, the Organization for Economic Cooperation and Development (OECD) informed that Costa Rica received the approval of the seventeenth committee required to finalize the process of joining this organization: the Investment Committee. Having reached this milestone, there are just five pending approvals, necessary to reach the ambitious goal by May 2020. The approval was achieved after completing an exhaustive evaluation of national public investment policies, under the leadership of the Ministry of Foreign Trade (COMEX) as governing body in this subject matter.
Foreign Trade Minister, Dyalá Jiménez, in charge of coordinating the adhesion to OECD and leader of the effort before this Committee, showed great satisfaction with this approval. She explained that “the first steps of Costa Rica's approach to this organization were precisely in the Investment Committee. Its evaluation is one of the most complex and rigorous, so concluding it positively is a very important milestone for the country. I thank and congratulate all the entities involved, as well as the COMEX team led by my predecessors for this achievement that represents a recognition of the stability, strength, and transparency of our country's regulatory framework for investment, as well as its foundation in principles of non-discrimination. ”
Our track record in this field is highlighted as a successful case in the world. An example of the above is the creation of the Network of investment promotion agencies of OECD countries, which was born thanks to a Costa Rican proposal. The network has managed to establish its annual meeting as a high-level forum for exchanging experiences and good practices on the most relevant issues on the agenda for promoting foreign direct investment (FDI).
During the Investment Committee's approval process, different institutions of the Executive Power participated (Ministry of Finance, Transportation, Economy, Environment andamp; Energy, Justice and Peace, among others), the Comptroller General of the Republic, and the entities controlling the financial sector (Central Bank of Costa Rica, CONASSIF and Superintendencies). The latter sector was the one that implemented the largest number of reforms (at administrative and legislative level, in areas such as securities, insurance and pensions).
The President of the Central Bank, Rodrigo Cubero, stressed that “the work that has been developed in the Central Bank to incorporate the highest international standards of the OECD in terms of investment statistics reflects the institution's commitment to provide quality statistics, reliable and robust, which encourage evidence-based decision making. We are also pleased to have contributed to the legal reforms necessary for the approval of the Investment Committee. ”
The work and commitment of the Legislative Assembly was also a fundamental factor for the country to successfully conclude this evaluation. Among the approved legal provisions are the regulation of new financial instruments such as derivatives (included in Law No. 9746) and authorization for branches of foreign banks to operate in the country (Law No. 9724).
Alberto Dent, President of CONASSIF, commented that “the financial superintendencies have carried out a thorough work to update the regulatory framework, facilitate and clarify the requirements for economic actors and thus generate new possibilities for investors in different sectors. At the legislative level, we have formulated bills consistent with international standards in financial matters, and thanks to the commitment of the Legislative Assembly, together we have also managed to modernize the financial regulations. The process of joining the OECD has been extremely valuable, since the constant reform in accordance with best practices sends excellent signals to investors, nationals and foreigners.”
1. Regime applicable to Investment. The committee evaluated Costa Rica based on standards that seek to promote transparency and non-discrimination between residents and non-residents in the field of investment. This is essential to generate certainty in national and foreign investors about the conditions under which their investments in the country will be treated.
2. Standards for Responsible Business Conduct. Under the OECD guidelines on responsible business conduct (CER) aimed at all companies (public and private) operating in international markets, the current regulatory and institutional framework was evaluated to promote the principles that this instrument pursues. These are centered on sustainability, respect for human rights, contribution to sustainable development and, in general, the positive impact of the business of companies in the scope of these purposes and values. The evaluation included a detailed review of the operation of the National Contact Point, a body that every member country should count on to ensure that CER standards and recommendations are being complied with by the companies operating in their territories, as well as by the National companies that operate in international markets (in the case of Costa Rica, it is established in the Investment Directorate of COMEX). Costa Rica has been assuming a role of increasing leadership in the work of the OECD in this area, since this organization recognizes that the country has advantages and opportunities to differentiate itself and to strengthen and further elevate its global positioning. Promoting CER is a two-way interest, since in its potential it can be exploited by national and foreign companies that decide to install their operations in the country, in both cases to strengthen participation in global value chains and insertion in the global market, differentiating itself by its compliance with the highest international standards. In the most recent work agenda of the National Contact Point of Costa Rica, this body is using the tool to support Costa Rican SMEs licensed with the Country Brand to take advantage of the quality standards defined under the brand values