Essay, Research Paper: Costa Rica


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The Republic of Costa Rica is in the midst of a dramatic transition from a
small, Central American nation known for its bananas and good coffee into a
gateway for international commerce between Latin America and the rest of the
world and a well traveled, if not over traveled, tourist destination--and
rightfully so. Costa Rica is a highly attractive country filled with beautiful
mountain ranges, undisturbed beaches and friendly natives or Ticos. In addition,
Costa Rica offers a highly educated work force, a stable economic and political
environment, and exceptional communications and transportation
networks--especially in comparison to its neighbors, Panama and Nicaragua. All
of these national characteristics, and others, have been fueling a movement of
multi-national companies, American retirees and tourists from around the world
into Costa Rica, in order to benefit from these treasures. One may adequately
predict that Costa Rica, specifically the capital city of San Jose and the
coastal regions on both the Pacific Ocean and the Caribbean Sea, have the
potential of becoming the “Silicon Valley” and “Ft. Lauderdale” of
Central America. That is to say, the major U.S. and European firms in the
personal computer and software industries, along with retirees and tourists,
will continue this trend of moving into Costa Rica for the next twenty five
years and maybe more. This trend and its longevity present geographers,
environmentalists, politicians and economists with a seemingly insurmountable
task of preventing the destruction of Costa Rica’s environment, culture,
society and natural resources while facilitating the expansion of both domestic
and international businesses and economic growth. Facing the challenge of
achieving sustainable development in Costa Rica is not specific to the public
servants and scholars mentioned above, but also requires the intellectual input,
physical effort and cooperation of every Tico and foreigner living or working in
the county. Although there are many issues concerning sustainable development in
Costa Rica requiring a wide range of solutions, the growing tourism industry and
preventing the destruction of the environment through ecotourism should be the
foremost priority of Costa Rica’s policy makers and environmentalists.
Ecotourism is an alternative to mass tourism that is educational, conserves the
environment and benefits local communities. In other words, ecotourism should
“incorporate economic development as a fundamental element of
Rica is situated on the Central American Isthmus and is bordered by Nicaragua to
the North and Panama to the South totaling 239 kilometers in border territory.
The Central American country consists of 51,000 square miles, of which only 440
are water due to the extensive mountains dominating the majority of the
country’s area. These mountain ranges, peaking at 12, 529 feet at Cerro
Chirripo, provide Costa Rica a wide variety of climate zones ranging from cloud
forests to rain forests to coastal plains. The coastal plains in the East and
the West stretch for 1,290 kilometers combined; The Pacific coast is twice a
long as the Caribbean coast. Land use--6% arable, 5% permanent crops, 46%
permanent pastures, 31% forests and woodland, 12% other--suggests the dominant
interests of Costa Rica are agriculture and preservation and reflects a general
disagreement over land use addressed later. The national park system, operated
by the government, protects 14 percent of the national territory and is one of
the main attractions for tourists.2 Guanacaste is the northwestern province of
Costa Rica and the home of numerous developed and undeveloped (national parks)
beaches and cattle ranches, the most expansive tenant in the region. Many of the
Pacific beaches are isolated and are not accessible by road creating a challenge
to many of those who flock to them to enjoy the excellent surfing conditions.
The Gulf of Nicoya is an ideal location for sea kayaking, sport fishing and
birdwatching along its undeveloped bays and coastal stretches. Many tour
companies offer expeditions to these areas by boat and plane illustrating the
potential of over development in a region already dominated by cattle ranches
and coffee fields.3 There are four major mountain ranges that form the central
corridor of Costa Rica minimizing the amount of flat land to just the sea coast.
Three of theses ranges have actively erupting peaks. The Cordillera de
Guanacaste extends 65 miles southeast from Lake Nicaragua and houses the active
Arenal Volcano at 6,000 feet. This volcano erupted in 1968 and 1985 killing few
in the sparsely populated region (54 percent of the countries population lives
in urban areas).4 Lake Arenal, popular for its ideal windsurfing conditions, was
formed by a rift separating the Cordillera de Guanacaste and the rest of the
mountain ranges to the southeast. Like the Cordillera de Guanacaste, the
Cordillera de Tilaran has many rivers draining into the ocean that are
completely inaccessible by road but remain enticing to adventuresome travelers
seeking wild thrills. The massive Cordillera Central, housing two active and two
potentially active volcanoes, remains a constant threat to the cities of San
Jose and Alajuela and frequently reminds their citizens of the threat with
dustings of volcanic ashes. These volcanoes, although potentially devastating,
have provided the rich, fertile land required to produce one of Costa Rica’s
largest exports, coffee. Enclosed by the peaks and volcanic craters of this
range is the Central Valley where two thirds of Costa Rica’s population
resides at 2,500 to 4,900 feet in elevation.5 The largest of the mountain ranges
is the Cordillera de Talmanca with the highest peak in the country at 12,529
feet. This range stretches southeast from Cartago all the way into Panama and
leads into the Caribbean Lowlands on its eastern side. The northeastern Lowlands
are sparsely populated but the foothills are populated by many farms and small
villages along the Caribbean coast which lead into the developed region of Limon
toward the south. The Limon region was originally settled because of its
accessibility by water and land. It has been converted primarily to agricultural
lands for banana plantations, which continue to expand causing concern because
of deforestation and excessive use of agricultural chemicals.6 Despite having
the appearance of a mountainous land mass of an inhibiting transportation
network inconsistent with industrial growth, the San Jose, Desamparados,
Puntarenas and Limon regions of the country offer very accessible transportation
networks while the remote regions offering seclusion and adventure to travelers
are accessible by air if not by water or a dirt roadway. There are 35,600
kilometers of roadways and highways, of which 5,945 km are paved; 950 kilometers
of railroads; 115 airports with paved runways and 28 without; 730 kilometers of
navigable waterways and six seaports that comprise Costa Rica’s transportation
infrastructure.7 The Democratic Republic of Costa Rica constitutionally
prohibits armed forces and therefore devotes a vast majority of its resources
the education and health care sectors which have produced a very well educated
and healthy society. Ninety four percent of the entire population of Costa Rica
is literate and only 8.3% of the population has had no formal education. This
highly educated, higher skilled population offers multi-national firms a huge
incentive to capitalize on a stronger work force than Costa Rica’s neighbors
through direct investment projects. In terms of a healthy society, the life
expectancy is 76 years for all Ticos and the infant mortality rate is 13.3 per
1,000 live births.8 Health services are readily available to most Ticos and
foreigners which serves to comfort most travelers and retirees settling in Costa
Rica. The Costa Rican economy depends primarily on tourism and the export of
bananas, coffee, sugar, timber and other agricultural products to generate a
gross domestic product $19 billion in 1996. In 1995, the agriculture industry
accounted for 18% of GDP, industry accounted for 24% of GDP and services
accounted for 58% of GDP reflecting the country’s dependence on tourism.
Economic growth has fallen since 1994 from 4.3% to 0.9% in 1996; inflation has
begun to fall recently after a jump up to 22.5% in 1995; unemployment in 1995
was low at 4.2% and 5.5% in 1996 however, there is a problem with
underemployment in the labor force.9 Much more so than recent trends, the
political and economic history of Costa Rica calls the attention of many firms
exploring foreign direct investment in the region mainly because of
stability--very few Central American nations can boast about political and
economic stability. MULTI-NATIONAL COMPANIES IN COSTA RICA: In the midst of a
volatile and explosive trend toward globalization, many international companies
have found in Costa Rica what they had expected to find in Latin American giants
such as Argentina, Brazil or Mexico: Good location, a strong and academic labor
force, low cost of living, low operating costs, adequate infrastructure, strong
telecommunications network, economic stability and political support. The
election of Miguel Angel Rodriguez Echeverria as President of Costa Rica in
April of 1998 has been a huge factor in recent deals between the government and
foreign companies. Within days of his election, Rodriguez met with prominent
business figures to discuss the nation’s economic future. The new President
announced a modernization and privatization plan calling for reduced inflation
and increased employment by increasing investment, tourism, infrastructure and
small businesses.10 The most significant recent development in Costa Rica’
economy is the announcement by Intel, the Pentium processor manufacturer, to
construct a $300 million Pentium Chip complex in a suburb of San Jose. The
significance of this project extends well beyond the benefits to the local
economy: The new plant will employ 2,000 locally hired skilled workers to
assemble and test the microprocessors designed by Intel in addition to the jobs
created to build the new facility. Furthermore, Intel’s move to Costa Rica is
expected to induce as many as forty of the company’s international suppliers
to follow suit and move into the San Jose region, creating even more jobs and
concentrating the technology industry in the country’s Central Valley.11 The
Central Valley of Costa Rica is now in the middle of a very exciting transition
as more technology and communications firms establish a presence in the
“Silicon Valley” of the Latin world. Large multi national firms such as Acer
and Microsoft have joined forces in Costa Rica to offer customer support to its
worldwide clientele. Acer is currently operating a $20 million, 350-employee
facility while the cellular phone company, Motorola, has a deal to build a $15
million, 950-employee facility in the San Jose region. Other direct foreign
investment projects contributing to Costa Rica’s “high tech” profile have
been negotiated by DSC of Texas, EMC Technology, Seagate and Hewlett Packard.
The DSC project is of particular interest because of its location within the
Metro Free Trade Zone which allows the firm to avoid tariff payments on
everything but the final product and illustrates the governments willingness to
help promote economic development and investment.12 Costa Rica’s stable
business environment is also attracting real estate speculators, venture
capitalists and retirees primarily from the United States and Europe. Many are
moving to Costa Rica to enjoy the beautiful climate and scenery of the coast.
Some move to retire while others move to open a bed and breakfast or a small
farm. But the real estate market still remains somewhat uncertain because of
land laws and problems with squatters legally assuming ownership of land after
five years of occupation. However, this problem does not seem to prevent many
people from offering and seeking opportunities in Costa Rica. Within five
minutes of searching on the Internet, I was able to locate a web site offering
thirteen properties including commercial centers, restaurants, bars, gated
residential communities, beach front cottages and undeveloped plots of jungle
all for sale and/or development. In addition to the already existing banana
plantations, coffee fields and cleared grazing land, the emerging real estate
and technology markets are raising concern about Costa Rica’s precious
environment. With an area of only 51,100 square kilometers, there are serious
limitations as to how much development, real estate or agricultural, can be
sustained before Costa Rica’s biodiversity is permanently destroyed. But
before exploring the issue of sustainable development, one must also consider
the exploding tourism industry and how ecotourism can play a large role in
preventing Costa Rica’s destruction. PRESERVATION EFFORTS IN COSTA RICA Costa
Rica’s highly educated population not only benefits international companies
seeking low cost, high skilled labor but also benefits the preservation efforts
of environmentalists throughout the country and the world. Most Ticos are well
educated and fully aware of the ecological importance and sensitivity of their
homeland and have been educated in the field of preservation. This has created a
political environment consisting of many organizations, funds and cooperative
efforts promoting the responsible utilization of Costa Rica’s land. Through
these conservation efforts, the Costa Rican government can boast about
“protecting 90 percent of its existing forests and the largest percentage of
land dedicated to national parks in the world.” 13 In addition to the National
Parks system, the government plays a large active role in joint efforts such as
Project CARFIX with FUNDECOR. “FUNDECOR is an environmental non-government
organization...with funding provided by the US Agency for International
Development, to assist community organizations in the sustainable management of
biodiversity and forest resources in...Costa Rica”14 This project is concerned
with the creation of a land management program surrounding the Braulio Carrillo
National Park that will create a “buffer zone” around the park to minimize
adverse affects of development in the region. Other projects directly address
the problems that are arising due to increased industrial activity such as
carbon dioxide pollution. The Costa Rican Ministry of natural Resources, Energy
and Mines has confronted the challenge of providing alternative energy sources
that drastically reduce pollution in an economical fashion. This has been near
impossible considering the high costs of solar powered electricity generation
and other natural energy resources. The Tierras Morenas Wind Farm Project
exemplifies the cooperation of the government and private firms--New World Power
Corp., Energia del Nuevo Mundo S.A. and Molinas de Viento de Arenal--the three
companies working with the government on this project. The project will
construct a 20 megawatt power plant consisting of 40 wind turbine generators.
This wind powered electricity will be located in the province of Guanacaste and
is expected to reduce carbon dioxide emissions by 100,000 short tons per year, a
significant reduction for a small nation with an expanding technology
industry.15 On the other hand, many of the conservation initiatives in Costa
Rica are privately funded or involve non-government organizations and private,
special interest associations. Educational and preservation foundations, such as
the Bosque Lluvioso Foundation, are privately funded and dedicated to preserving
and “restoring forests while expanding scientific and educational programs
aimed at the understanding of the intrinsic value of tropical rain forests.”16
The Monteverde Biological Corridor Carbon Sequestration is an example of how the
US Joint Initiative on Joint Implementation, the Arenal and Monteverde
Conservation Associations and the San Luis Development Association joined forces
to effectively protect the environment. Their common goals, through purchase and
lease agreements concerning 16,000 hectares between the Monteverde Cloud Forest
Preserve and the Gulf of Nicoya are: 1) long term conservation of the
Arenal-Monteverde area; 2) improvement of the socioeconomic status of corridor
residents; 3) protection of existing forest and regeneration of forest on
unproductive pasture land; 4) improvement of and 5) further development of
low-impact ecotourism.17 Facing high costs of research and implementation of
such programs--the aforementioned Monteverde alternative energy project is
priced at $5,916,22518--many conservation initiatives are exploring ecotourism
projects as an a viable option considering its ability to generate revenue for
funding and profits due to increased tourism in Costa Rica. ECOTOURISM IN COSTA
RICA The partnership between the Fundacion Cuencas de Limon and the Selva
Bananito Lodge exemplifies the success ecotourism can achieve when combined with
conservation efforts of environmental groups, government projects and private
foundations. The Limon Watershed Foundation is a non-profit organization that
was founded in response to “indiscriminant logging in southeastern...Costa
Rica and to the deterioration of water quality in the area’s rivers. Since the
1997 establishment, the Foundation has promoted cooperation between local
farmers, agricultural corporations, government agencies and non-government
agencies in curtailing illegal logging and wood extraction from protected
lands.19 The foundation is facing one of the most difficult challenges of
ecotourism and sustainable development: Influencing attitudes among local
farmers, loggers and other natives who depend on exploiting the land to survive.
However, the foundation seems to be managing this conflict of interests well and
has seen increased activity and involvement in the program of local Ticos. The
foundation has yet to prove itself to be successful in reaching many of its
goals simply because it is not event two years old. But with the financial
support from the Selva Bananito Lodge, the Fundacion Cuencas de Limon should be
able to: 1) protect rain forest vegetation along the watersheds of the Banano,
Goban, Estrella, and Bananito Rivers; 2) Educate local residents; 3) monitor and
prevent illegal activities in the region’s parks and reserves and; 4) expand
the biological buffer zone along the La Amistad Biosphere Reserve spanning over
1 million hectares.20 The Selva Bananito Lodge was opened in 1995 by an America
family and is situated 20 kilometers south and 15 kilometers inland of Puerto
Limon in a secluded rain forest. The 850 hectares borders the La Amistad
Biosphere Reserve near the Cahuita National Park generates all of its income
from tourism. The adverse affects of tourists is minimized by limiting the
number of visitors permitted at any given time, the use of solar heated water,
the absence of electricity and the seven small cabins placed within a small
area. Educational rain forest study programs are offered to students and
scientific researchers will soon be welcomed to the park. Some of the programs
highlights include: 1)day time experiments in the forests; 2) evening
discussions about ecotourism, deforestation and forest management and; 3) a
visit to the Agriculture Research Institute (EARTH). The families 1250 hectares
of land is devoted to low impact, sustainable agriculture and cattle management
(416 hectares) and forest preservation (834 hectares).21 The management of the
Selva Bananito Lodge, its surrounding reserves, the educational program and
financial support of Fundacion Cuencas de Limon has thus far been successful.
This early success is primarily due to the tight control of the families land,
its proximity to government protected forests and its partnership with the
watershed foundation. Many of the problems usually associated with an ecotourism
and land preservation project, such as socio-economic and socio-political
challenges, have been avoided because of the family’s wealth and the division
of responsibility of between the two partners. Many of the challenges ecotourism
presents were, in fact, characteristic of a project in Rio Blanco Ecuador.
ECOTOURISM--RIO BLANCO ECUADOR Ecotourism is an alternative to mass tourism that
is educational, conserves the environment and benefits local communities. In
other words, ecotourism should “incorporate economic development as a
fundamental element of conservation.”22 The case of Rio Blanco, Ecuador offers
a vast amount of insight and information regarding the challenges to the
development of a successful ecotourism industry in a small Latin American
village and possible solutions to overcome them. What the project ultimately
reveals is the necessity of local control of ecotourism activities, national
oversight and partial financial support along with careful planning and
organization. The indigenous Quichua community in Rio Blanco is situated in the
Ecuadorian Amazon and was founded in 1971. The economy was dominated by hunting
and cultivation of cash crops such as coffee, rice and cacao but the relatively
high population condensed into a small region has adversely effected the local
ecology. High growth and rising cost of living standards has resulted in
deforestation and expanded land under cultivation. The community has responded
to these problems by developing and ecotourism project to generate income and,
according to environmentalists wishes, substitute the preservation of land for
tourism for the destruction of forests for cultivation. The challenges and
conflicts that the Quichua community has faced since implementation if the
project are applicable and relevant to most ecotourism programs. The goal of
this project was to improve the standard of living in the Quichua community
while simultaneously preventing further deforestation. This presents the first
and most difficult challenge: How does the community shift its emphasis on
agriculture to a combination of agriculture and tourism? First of all the
benefits of the change must be tangible to every member of the community and
they must be retained by the community. That is to say, the profits and other
benefits from ecotourism must not leak out to other regions or countries. This
is achieved by maintaining local control over the project. If foreign investors
are permitted to control the tourism industry in a community, few local
residents will share in the profits.23 In Costa Rica, the Selva Bananito Lodge
is foriegn owned, however, profits are shared by the family and the foundation
which presents successful alternative to complete local control. Another problem
Schaller mentions in his study of the Quichua community is the lack of
government cooperation and inability of locals to obtain national. He sites that
“governments may unwittingly hinder local tourism...[and] too often local
people have neither the political power or business connections to compete at an
international level with mass tourism.”24 Interestingly, it may be the
national government that can overcome the shortfalls of their policies and local
power by implementing a national program to promote ecotourism. As mentioned
earlier, the Government of Costa Rica plays a large role in environmental
preservation which should serve as an example to other governments such as that
of Ecuador. A simple program that the US Government has practiced is the
issuance of block grants to each state for welfare programs. Block grants to
provinces and local communities for development of ecotourism could be based on
performance which would provide incentive to preserve the ecology and innovative
tourism programs. This would reduce economic leakages--through government
regulation--and reduce economic pressures to clear more land for cultivation.
Furthermore, the government subsidies provided to the ecotourism industry has
the potential of creating a level playing field of competition between mass
tourism and smaller scale ecotourism. The absence of economies of scale in the
ecotourism industry may eventually be the demise of the industry itself because
of its economic inefficiency. However, government subsidies--if the funds are
available--can alleviate this problem in the long run. Similarly, Schaller
argues that “Increased demand encourages larger scale projects to move in,
leading to mass tourism, a loss of local control, and the end of any hopes for
ecotourism’s sustainanbility.”25 His statement is incontestable a solution
lies within the management strategy of a Swiss-Swedish electrical engineering
multinational firm, Asea Brown Boveri. The CEO of this firm recently described
his management strategy for an article published by “World Trade Magazine.”
Three of his main objectives: “1) Common values must be established and then
shared by every branch of the company; 2) create links through mentors between
like divisions in different countries and; 3) operations in each country must
adapt the company’s global vision to local market and operation needs.”26
can be applied to large scale management of ecotourism development through the
creation of an American-style trade association. The establishment of a trade
association representing local communities like the Quichua’s and individual
owners developing ecotourism in a nation or region that applied these objectives
would almost guarantee the survival of small-scale ecotourism ventures
throughout Latin America. The resulting objectives of the trade associations
management policy would be: 1) Common values concerning the preservation of
cultural identities and maintenance of local control between each project; 2)
Create links between similar communities within a particular region or country
so prevent conflict, inflated competition and to foster the sharing of ideas
and; 3) projects in each country must adapt the global vision of environmental
preservation and sustainable development to the region. Trade associations and
block grants are not the only solutions to the many economic, cultural, social,
political and environmental challenges characteristic of ecotourism and
sustainable development but they do provide an essential stepping stone. Many
Latin American nations are experiencing the growth in industry and tourism much
similar to Costa Rica and there are numerous projects like the Selva Bananito
Lodge/Fundacion Cuencas de Limon and the Quichua ecotourism development project
throughout the region. Hopefully they will all contribute to the preservation of
their natural resources and diverse ecological systems while developing their
economies and much needed industries.
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