Costa Rica: An Overview
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Updated March 7, 2025
Costa Rica: An Overview
Costa Rica historically has been a bastion of stability in Central America and often has served asat times has been a key U.S. partner for advancing policy goals in the region. The 118th Congress sought to reinforce U.S.-Costa Rican security cooperation by appropriating security assistance for the country and authorizing the U.S. Armed Forces to engage in certain training with Costa Rican security forces. The 119th Congress may monitor U.S.-Costa Rican efforts to address shared challenges, such as transnational crime and unauthorized migration, as well as potential opportunities, such as collaboration on supply chains in strategic sectors.
Political Situation
enacted appropriations and other legislation (P.L. 118-159, §1209) intended to reinforce U.S.-Costa Rican security cooperation. The 119th Congress may monitor and shape bilateral collaboration on issues such as transnational crime, migration, and semiconductor supply chains.
Political Situation
Costa Rica has sustained civilian democratic governance since 1949, when the country adopted a new constitution in the aftermath of a short civil war. The center-left (now centrist) National Liberation Party (PLN) and a center-right opposition that ultimately became the Social Christian Unity Party (PUSC) dominated postwar politics. In the early 2000s, however, corruption scandals and public dissatisfaction contributed to the collapse of the two-party system. AlternativeVarious political parties have emerged since then, such as the center-left Citizens’ Action Party (PAC), which won the 2014 and 2018 presidential elections, and current President Rodrigo Chaves’s center-right Social Democratic Progress Party (PPSD).
contributing to a more fragmented multiparty system.
President Rodrigo Chaves, a former Costa Rican finance minister and World Bank official, began hisa four-year presidential term in May 2022 after defeating. Nominated by the center-right Social Democratic Progress Party (PPSD), Chaves defeated former President José María Figueres (1994-1998) of the PLN 53%-47% in a runoff election. Among other actions in office, Chaves has implemented fiscal reforms, enacted legislation focused on combatting organized crime, and declared national emergencies in response to cyberattacks and migration flows, enabling the government to draw on additional funding and authorities.
Chaves has struggled to advance other proposals through Costa Rica's unicameral Legislative Assembly, in which the PPSD won 10 of 57 seats in 2022 in a runoff election. In his inauguration speech, Chaves promised to “rebuild” the country and laid out his top priorities, which included reducing the cost of living, generating increased employment, and combatting corruption and crime. Among other actions in office, Chaves has reduced import tariffs on rice—a staple of the Costa Rican diet—and signed into law legislation intended to enhance the country’s ability to combat organized crime. Chaves also has declared national emergencies in response to challenges including cyberattacks and migration flows, enabling his government to draw on additional funding and authorities.
Chaves has struggled to advance other proposals through Costa Rica’s fragmented unicameral Legislative Assembly, in which his PPSD holds 10 of 57 seats. He has occasionally attempted to go around the legislature and govern through public referendums, but Costa Rica’'s courts have blocked those efforts. Although Chaves’s clashes with other branches of government have ledChaves has criticized these checks on his authority, leading some analysts to express concerns about his respect for the separation of powers, many Costa Ricans appear to support Chaves’s approach to governance. In a November 2024 University of Costa Rica poll, 63% of Costa Ricans rated his performance positively. Costa Rica’s constitution prohibits individuals from serving consecutive presidential terms, and it is
unclear who Chaves may support in the next election, scheduled for February 2026.
Figure 1. Costa Rica at a Glance
Sources: CRS Graphics, Instituto Nacional de Estadística y Censos; International Monetary Fund; Trade Data Monitor.
Economic and Social Conditions
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In July 2025, the Legislative Assembly appointed a special commission to assess the supreme court's request to strip Chaves of his immunity from prosecution to face charges related to alleged corruption in the awarding of a government contract. The commission is to issue its recommendations to the full Legislative Assembly by September 2025. Chaves has denied the allegations. Costa Rica's next presidential and legislative elections are scheduled for February 2026; Chaves is ineligible to seek reelection due to Costa Rica's constitutional ban on consecutive presidential terms. He is supporting his former planning and interior minister, Laura Fernández, who is backed by a new Chaves-aligned Sovereign People's Party. At least 11 other candidates from across the political spectrum are also expected to compete in the election.
Figure 1. Costa Rica at a Glance Sources: CRS graphic; data from Instituto Nacional de Estadística y Censos, International Monetary Fund, Trade Data Monitor.
Economic and Social Conditions
Costa Rica pursued state-led economic development throughout much of the 20th century but began to adopt a more market-oriented economic strategy in the 1980s. Since that time, it has attracted a cluster of high-tech manufacturers, including semiconductor producers and medical device companies, and has developed a dynamic tourism sector, contributing to the diversification of the country’s once predominantly agricultural economy. According to the Economist Intelligence Unit, services— including tourism—now comprise about two-thirds of gross domestic product (GDP), while high-tech manufacturing accounts for a plurality of Costa Rican exports and much of the foreign direct investment in Costa Rica.
The Chaves administration The IMF projects Costa Rica's GDP growth will slow to 3.4% in 2025, due in part to U.S. tariffs and slowing global demand. Costa Rica may draw upon a new two-year, $1.5 billion flexible credit line, approved by the IMF in June 2025, to address external shocks.’'s economic policy has focused primarily on strengthening the government’'s finances. It successfully completedconcluded two agreements with the International Monetary Fund (IMF), which provided the Costa Rican government with about $2.3 billion in financing between 2021 and 2024 to implement policies intended to stabilize Costa Rica’'s debt burden, support economic recovery from the COVID-19 pandemic, and address climate risks. Costa Rica’'s public debt declined from nearly 68% of GDPgross domestic product (GDP) in 2021 to below 60% of GDP in 2024 due to a mix of factors, including the Chaves administration’'s tight fiscal policy, tax and public employment reforms enacted by the previous government, and annual economic growth rates averaging more than 5%.
U.S.-Costa Rican Relations
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Strong economic growth also has contributed to reductions in poverty and unemployment. Nevertheless, Costa Rica’s level of income inequality remains above the Latin American average, according to the UN Economic Commission for Latin America and the Caribbean.
Costa Rica: An Overview
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U.S.-Costa Rican Relations
Successive U.S. Administrations have worked with Costa Rica to strengthen economic ties, advance regional foreign policy goals, and address shared security concerns. During a February 2025 visit to Costa Rica, Secretary of State Marco Rubio characterized Costa Rica as a “model”"model" for the region and commended the country’'s cooperation on cybersecurity, counternarcotics, and migration. Secretary Rubio stated that he had issued waivers to allow continued U.S. support for some security programs amid the Trump Administration’s 90-day pause on U.S. foreign assistance; it is unclear if or how the subsequent cancellation of thousands of unspecified U.S. assistance awards and contracts may affect programs in Costa Rica. Congress may monitor the Administration’s approach to U.S.-Costa Rican relations and assess whether and how to continue shaping bilateral ties with appropriations and other legislation.
The United States and Costa Rica are parties to the Dominican Republic-Central America-United States Free Trade Agreement (CAFTA-DR; P.L. 109-53), which was signed in 2004 and entered into force for Costa Rica in 2009. Under the agreement, all U.S. nonagricultural goods and nearly all U.S. agricultural goods are eligible to enter Costa Rica duty free. In April 2025, President Trump invoked the International Emergency Economic Powers Act of 1977 (50 U.S.C. §§1701 et seq.) to impose a 10% tariff on U.S. imports from Costa Rica (with some exceptions) due to a purported lack of reciprocity in trade relations. The tariff rate increased to 15% on August 7, 2025. The Costa Rican government has asked the Trump Administration to pause the tariffs amid ongoing negotiations.Trade and Investment Ties The United States and Costa Rica are parties to the Dominican Republic-Central America-United States Free Trade Agreement (CAFTA-DR; P.L. 109-53), which was signed in 2004 and entered into force for Costa Rica in 2009. U.S.-Costa Rican trade in goods reached a record high of $21.3 billion in 2024, according to U.S. Census Bureau data. U.S. goods exports to Costa Rica totaled $9.7counternarcotics, cybersecurity, and migration. The United States has supported such collaboration with foreign assistance, but the status of such funding is unclear in the aftermath of the Trump Administration's review and termination of thousands of programs.
Trade and Investment Ties
U.S. imports of electronic integrated circuits from Costa Rica rose from $121 million in 2021 to $1.2
According to the U.S. Bureau of Economic Analysis, U.S. foreign direct investment in Costa Rica totaled $7.1 billion in 2024, with 74% invested in manufacturing. In 2023, Intel, a U.S.-based technology company, in 2024. This increase coincided with U.S. efforts to create stronger, more secure global semiconductor supply chains, drawing on incentives enacted in the CHIPS Act of 2022 (P.L. 117- 167, Division A). In 2023, Intel announced plans to invest $1.2 billion in Costa Rica by 2025. This investment coincided with a U.S.-Costa Rican partnership aimed at strengthening global semiconductor supply chains. In FY2024, the State Department obligated $13.8 million for related workforce development programs in Costa Rica, funded by the CHIPS Act of 2022 (P.L. 117-167, Div. A).
Transnational Crime
Costa Rica in Costa Rica by 2025. The U.S.-based technology company had previously closed a microchip assembly and testing facility in Costa Rica in 2014, moving those operations to China, Malaysia, and Vietnam. According to the U.S. Bureau of Economic Analysis, the accumulated stock of U.S. foreign direct investment in Costa Rica was $3.8 billion in 2023, with 53% invested in manufacturing.
Congress has appropriated U.S. foreign assistance for Costa Rica to help the country combat transnational crime. The explanatory statement accompanying the Further Consolidated Appropriations Act, 2024 (P.L. 118-47), carried through FY2025 by the Full-Year Continuing Appropriations and Extensions Act, 2025 (P.L. 119-4), designated at least $46 million in security assistance for Costa Rica. The report accompanying the National Security, Department of State, and Related Programs Appropriations Act, 2026 (H.Rept. 119-217 to H.R. 4779) would designate at least $50 million in bilateral and regional security assistance for Costa Rica.Security Cooperation Costa Rica’s institutions have proven more resilient than those of its Central American neighbors, but the country has experienced an increase in organized crime and violence over the past decade, which over the past decade. Homicides rose from 471 (9.9 per 100,000 residents) in 2014 to 880 (16.6 per 100,000) in 2024. Costa Rican authorities have linked much of the violence to drug trafficking organizations, which that use the country as a transit and storage point for South American cocaine destined for the United States and Europe. Domestic drug consumption—including a nascent fentanyl market—also has fueled turf battles among criminal organizations, according to the U.S. State Department. In August 2025, the U.S. Treasury Department imposed asset-blocking sanctions on four Costa Rican nationals—including a former public security minister—for their involvement in drug trafficking and money laundering. Two of the individuals are awaiting extradition to the United States.
Cybersecurity and Visa Revocations
Congress has appropriated U.S. foreign assistance for Costa Rica to help the country combat transnational crime and other security threats. For example, in the explanatory statement accompanying the Department of State, Foreign
Operations, and Related Programs Appropriations Act, 2024 (P.L. 118-47, Division F), Congress designated at least $46 million in bilateral and regional security assistance for Costa Rica. Such assistance has included equipment, training for security and justice sector personnel, and support for crime prevention programs.
The U.S. Department of Defense (DOD) has provided additional equipment and capacity-building support to Costa Rica using its security cooperation authorities (e.g., 10 U.S.C. §333). The Servicemember Quality of Life Improvement and National Defense Authorization Act for Fiscal Year 2025 (P.L. 118-159, §1209) authorizes the general purpose forces of the U.S. Armed Forces to engage in training with Costa Rican security forces through 2030. Costa Rica abolished its military following the country’s 1948 civil war but has several security forces that perform national security functions, including the public force, air surveillance service, and national coast guard service.
Cybersecurity has emerged as a key area of bilateral cooperation since 2022, when a Russia-based hacker group carried out a series of ransomware attacks against the Costa Rican government. In 2023, the U.S. State Department and During Secretary Rubio's February 2025 visit to Costa Rica, he stated that the United States would continue to help Costa Rica secure its telecommunication systems against cyberattacks and "impose costs on those within the country who use their positions of authority to undermine the interests of the people of Costa Rica and in favor of a malign foreign actor." Since then, the State Department reportedly has revoked the visas of the president of the Legislative Assembly, a supreme court justice, and a former president, among other officials, denying them entry into the United States due to unspecified ties to China. Some of these officials have argued that the visa revocations violate Costa Rica's sovereignty and infringe on their freedom of expression and their abilities to perform their public duties.DOD Department of Defense announced commitments totaling nearly $35 million to help Costa Rica strengthen its cyber defenses. The same year, the Chaves administration limited participation in Costa Rica’'s fifth-generation (5G) telecommunications network to firms from countries that endorse the Budapest Convention on Cybercrime, effectively excludingexcluding companies from the People's Republic of China (PRC, or China).
Migration and Refugee Flows
As a comparatively prosperous and stable country, Costa Rica has been a destination for migrants and asylum-seekers from other parts of Latin America. The country has experienced a surge in asylum requests over the past decade, primarily due to political repression in neighboring Nicaragua. According to the UN Refugee Agency, nearly 263,000 forcibly displaced people resided in Costa Rica in 2024, including 205,000 Nicaraguans. The U.S. government companies from China.
Migration and Refugee Flows As a comparatively prosperous and stable country, Costa Rica has long served as a destination for migrants and asylum-seekers from other parts of Latin America. The country has experienced a surge in asylum requests over the past decade, primarily due to the ongoing political crisis in neighboring Nicaragua. According to the UN Refugee Agency, nearly 248,000 forcibly displaced people resided in Costa Rica in 2024, including 197,000 Nicaraguans.
Other migrants pass through Costa Rican territory on their way to the United States. According to the International Organization for Migration (IOM), an estimated 325,000 migrants entered Costa Rica in 2024, with Venezuelans appearing to account for the majority. Costa Rica has worked with the U.S. government to screen those transiting the country and address potential security threats.
In February 2025, the United States transferred 200 unauthorized Asian migrants to Costa Rica to await repatriation to their countries of origin. Congress could inquire about the details of this arrangement, which the Costa Rican government asserts is funded by the United States with implementation support from IOM. According to the U.S. State Department, the United States has provided nearly $90 million to humanitarian organizations since 2018 between 2018 and 2024 to support migrants and refugees in Costa Rica.
Peter J. Meyer, Specialist in Latin American and Canadian Affairs
IF10908
Costa Rica: An Overview
https://crsreports.congress.gov | IF10908 · VERSION 12 · UPDATED
Disclaimer
This document was prepared by the Congressional Research Service (CRS). CRS serves as nonpartisan shared staff to congressional committees and Members of Congress. It operates solely at the behest of and under the direction of Congress. Information in a CRS Report should not be relied upon for purposes other than public understanding of information that has been provided by CRS to Members of Congress in connection with CRS’s institutional role. CRS Reports, as a work of the United States Government, are not subject to copyright protection in the United States. Any CRS Report may be reproduced and distributed in its entirety without permission from CRS. However, as a CRS Report may include copyrighted images or material from a third party, you may need to obtain the permission of the copyright holder if you wish to copy or otherwise use copyrighted material.
In February 2025, the United States transferred 200 unauthorized migrants to Costa Rica to await repatriation. According to the Costa Rican government, the arrangement was funded by the United States with implementation support from the International Organization for Migration. In June 2025, Costa Rica's supreme court ruled that the migrants' rights had been violated and ordered the release of some 28 migrants who remained in Costa Rica. S.Res. 353 would direct the State Department to provide Congress with information on Costa Rica's human rights practices, including the treatment of the transferred migrants and related U.S. engagement, pursuant to Section 502B(c) of the Foreign Assistance Act of 1961 (P.L. 87-195).