Financial News

Are You Thinking About An Exporting or Importing Business in Costa Rica?

Thinking about opening and importing or exporting business in Costa Rica? Or do you already have one and are looking for a reliable company to help you in the international logistics process? Conexión Logística Centroamericana S.A., is a company created in year 2014. It´s main mid-term goal was to become the best option for the transportation of goods and the handling of integrated logistics in the Central American region. The company is own by Costa Rican capital only and has its main offices in San José. Their main focus is on land transportation, imports and exports in Central America, Mexico and Panama, using FCL and LCL methods. They operate several business alliances which allow them to offer a door to door service of high quality and accessible cost. Conexión Logísitca offers all the spectrum of services which belong to the international distribution chain: warehouses, importing and exporting customs procedures, tax or health related procedures for importing and exporting and local delivery.

They also offer transportation services for refrigerated or frozen goods. The company has 4 t0 8 tons trucks for urgent delivery or for goods and products that need to travel in isolated environments. But their services are not only transportation in itself, they also offer assessment and consulting in everything related to transportation processes, packaging methods and materials, cargo handling, international cargo insurance, assistance in BASC processes and quality certifications.

Conexión Logística promises to connect your importing and exporting business with the success you need and at the same time they want to offer help in the commonly complicated international logistics process. They claim you can trust them with your importing and exporting businesses to improve in other much needed areas of your business.

If you are interested in getting more information about their company you can email info@colocesa.com or visit their website www.colocesa.com.

Banca Kristal, First Women´s Bank of Costa Rica

Banca Kristal Costa RicaDecember usually comes with surprises and people are already waiting for them. Last December was not the exception in Costa Rica. For the first time in history, a banking institution exclusively for women was created in Costa Rica. A new idea that no one knows how it will turn out. It will have to compete against large banks like Banco Nacional and BAC San Jose, and their main catch will be the fact that it is bank for women.

Banca Kristal describes itself as a bank that was born to boost the potential of women through a financial offer which will cater all of their needs. They are also advertising the fact that they have capable financial advisers who will educate women in financial topics and the knowledge of offers, programs and digital tools the bank has available for all Costa Rican women.

Among the benefits this bank has to offer, they have cash back programs, referral programs and credit card promotions such as coupons, insurance and financial assistance. It also offer saving accounts programs for beauty, home maintenance, maternity, fashion, health, education, among others. They also advertising a special insurance for stolen bags, which seem to be an indispensable item for all women, at least it is for Costa Rican women, but that is topic for another article.  Most men always wonder how the ladies work magic out of those small bags!

Banca Kristal is a project executed by Banco de Costa Rica. The entity invested between $8 million and $10 million USD in the project from design to execution and opening of the 5 stores it has at the moment. Of course, there has been a lot of comments against the idea and the money invested. Some women have felt offended by the concept by considering it discriminates and creates segregation and that it gives the impression that women cannot invest in valuable things like real estate, only in beauty items and shoes.

On the other hand, the Banco de Costa Rica management team defends the concept of Banca Kristal and says it will be a space where women can come in with their kids with no waiting lines, playing areas for children and breast feeding rooms for moms to take care of their kids without the rush of a traditional banking system in Costa Rica, which can be crazy and hectic.

It will be interesting to see in the near future how the project turns out and what acceptance it has among Costa Rican women.

2016 Economic Projections for Costa Rica

Glass globe with stock chart

The productive sector in Costa Rica will face similar scenarios to those faced in 2015.  However, the results will depend on the approval of fiscal package (expected to be approved for a long time now) and some external factors. Macro prices will have a similar behavior to those of 2015, and the economic stability will prevail. The biggest thread continues to be the fiscal deficit, which, according to some economists, will come close to 6.6% in 2016.

Many economist believe that even if the tax package is not approved in 2016 the economic situation won´t be as bad as expected. However, in 2017 the situation would be severe. So this means, that if in year 2016 the expenses continue to grow over the income then the negative effects will be felt in 2017.

Prices for raw materials overseas will still remain low, but it is unknown how long this situation will last.

The productive sector and the Costa Rican Congress are in expectation of a proposal to reduce expenses which will complement the projects presented in 2015 to increase Government income; mainly by increasing income tax and setting in place a new aggregated value tax (IVA) – this last one does not exist in Costa Rica to date.

The recently announced increase in interest rates by the US Fed won´t cause a big impact in Costa Rica in 2016 as the Central Bank already announced that increase has been already discounted.

As for pricing index and production, the results for 2016 will be close to those of 2015, unless of course unexpected events arise. Inflation will jump up from the extraordinarily low levels it reached in 2015, but it will be closer to the lower end of the expected range by the Central Bank; the expected inflation by this authority is 3% to 5%. So, if the behavior is as expected inflation will be closer to 3% in 2016. Along this line, the prices for raw materials are expected to increase a little bit, which will put more pressure on the fiscal deficit.

Exchange rate is always an important matter, especially for foreigners looking to invest in Costa Rica. The dollar exchange rate for 2016 in Costa Rica is expected to be in between 510 and 545 colones per dollar. The exchange rate won´t experience in 2016 the factors which helped it decrease in 2015 such as money reserves from Eurobonds or the decrease in oil prices or the transfer of portfolios in dollars to colones.

The Tasa Básica Pasiva (TBP), which is the Costa Rican base interest rate to calculate the value of loans, will decrease mainly to the implementation of the metodological exchange system which will go into effect in February.

The growth of the GDP is expected to be a little under 4% which is the goal of the Costa Rican Central Bank. This estimation is very positive because it will move away from the low levels it experienced in 2015 which, had not been seen in the country in the prior 6 years.

In summary, for 2016 the economic projections for Costa Rica are as follows:

  • GDP – Highest 4.3%. Lowest 2.5%
  • TBP – Highest 6%. Lowest 3.6%
  • Exchange Rate – Highest 545 CRC. Lowest 510 CRC
  • Inflation – Highest 5%. Lowest 1%

* This post is a summary of an article from El Financiero, a Costa Rican financial newspaper.

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