business1The Costa Rica News (TCRN) – My North American friends often ask me “What can I do in Central America?” in terms of business start up. I tell them Central America is an under developed group of countries, so everything needs development, there is opportunity everywhere for the entrepreneur at every level especially in Costa Rica.

At a population of 589,018,000+, Latin America as a whole is called the largest emerging economy on the Globe, as more countries are opening up to trade agreements, the exploding middle class require and demand more and better everything.

Central America is home to 41 million inhabitants and seven countries which are Belize, Guatemala, Honduras, El Salvador, Nicaragua, Costa Rica and Panama. These countries are quite unique and diverse, but Costa Rica and Panama are by far the most developed and stable.

The common problems faced by Central American countries are inequality, widespread illiteracy, poverty, and corruption and as well, the percentage of higher education students is low which limits the talent, entrepreneurship and innovation.

Further, education is geared towards to fulfilling corporate jobs which further exacerbates the problem of slow innovation and entrepreneurship. A culture of poverty, the last and current generations of Central America countries are extremely conservative and not risk takers opting instead for the stability of a paying job.

International trade agreements are creating job growths in telecommunications, industrial and manufacturing, as well as hard and soft tech. These companies offer better than average pay for these jobs, so there is no shortage of news job for locals and no shortage of young employees to fill them.

Dental care in Costa Rica

But, there is plenty of opportunity in Central America for the entrepreneur that is a forward thinking risk taker.
With these free trade agreements whole industrial park are being implemented throughout the region. And with that service/product support businesses will also have to keep pace.

The vast potential of the opportunities available are continually attracting new start-ups in areas such as e-commerce and services that cater to the fast rising middle class populations.

While barriers such as financing and legal processes still remain, the region has seen exponential growth in many areas and most industry leaders expect continued very good growth over the coming decade.

Internet use is expected to grow approximately 50% over the next five years in the region as well access to international credit cards and online transactions are expected to skyrocket. So there is need for platforms to cater to this emerging rising market.

Entrepreneurs have opportunity to provide innovation in the supply chain as well innovation in products, human resources management and business outsourcing in general, access to new technologies, manufacturing, software development and marketing services.

Real estate investors are seeing positive opportunity growth over the next decade across the full spectrum of real estate sectors; agriculture, commercial residential, flagship condo projects, etc. As access routes open up into previously inaccessible areas, developers and investors quickly follow.

While there is opportunity at every corner in Central America, the most important point for entrepreneurs looking to break into the market to consider is country stability. Government changes often mean radical shifts in policies on ownership restrictions, trade and foreign development and investment.

The Doing Business Project provides objective measures of business regulations and their enforcement across 185 economies and selected cities at the sub-national and regional levels.

The table below lists the overall “Ease of Doing Business” ranks (out of 185 economies) and shows the change in rank from 2012 to 2013.

Country

Change in Rank

Costa Rica

+12

Guatemala

+5

Honduras

+4

Nicaragua

+1

Panamá

+1

Belize

+1

El Salvador

-2

(International Finance Corporation and World Bank)

Costa Rica

The IFC and World Bank ranking above show Costa Rica clearly outpacing other countries in Central America.

Recent changes in the global economy and development in Costa Rica’s communication and information infrastructure have facilitated the integration of peoples and trade possibilities and have required employers to look for new and better ways to grow and manage their business opportunities.

While the Costa Rica’s government and universities continue to invest in entrepreneurial education and focus on policies and homegrown programs that promote resident growth of micro opportunities such as small and medium enterprises and ventures, foreign entrepreneurs are finding abundant opportunity in everything from opening product and service franchises to small “mom and pop” business.

On the large, Central America has and will continue to yield significant opportunity for the entrepreneurs and innovators. Growing middle classes, opening trade and access is creating an entrepreneurial boom in Central America.

For more information or consulting on entrepreneurship or business in Costa Rica Contact Us or our Expert Biz Consultant Daniel Yepez

Terrence Johnson

The Costa Rica News (TCRN)
San José Costa Rica