Multi-million dollar upgrades are already under way but large-scale investment and joint ventures are needed to boost the nation’s transport infrastructure and raise its competitiveness
Greater public and private investment in transportation infrastructure is high on the government’s agenda as it seeks to bring much needed improvements to Costa Rica’s neglected road network. Years of poor maintenance and lack of funding, as well as heavy rainfalls and landslides, have taken their toll on the state of the country’s transport arteries.
Costa Rica contains more than 21,000 miles of highways, of which only 12% are paved. Furthermore, travel on the majority of the unpaid roads is nearly impossible during the wet months of the year. Therefore the country requires investment in its transport infrastructure if it is to maintain high economic growth. In recent years, only a small proportion of government budget – reportedly just 0.63% of GDP in 2007 – has been allocated to infrastructure, most of which going on the country’s roads.
President Chinchilla sees infrastructure as one of the key areas that will boost the social and economic development of Costa Rica, and an ideal sector for increased public-private partnerships (PPPs) for both financial and knowledge-transfer reasons.
“PPPs could be the way ahead for large-scale projects,” says Minister of Public Works and Transport Francisco Jose Jimenez Campos, who would like to see development across the board. “We gain nothing if we have a good airport and a bad road; it all fits together. So the development of the ports has to be accompanied by improved road and rail passenger transport. The government's program put forward by President Chinchilla speaks of how to improve roads, ports and airports together. They are not to be seen as separate projects.”
|‘WE GAIN NOTHING IF WE HAVE A GOOD AIRPORT AND A BAD ROAD. SO THE DEVELOPMENT OF THE PORTS HAS TO BE ACCOMPANIED BY IMPROVED ROAD AND RAIL PASSENGER TRANSPORT’|
FRANCISCO JOSE JIMENEZ CAMPOS, Minister of Public Works & Transport
Costa Rica has international airports at Limon, Liberia and San Jose. The Minister says, “We have 22 local airports renovated with several million dollars of investment. The construction of an international airport in the south would be very beneficial.”
Last April the new government gave the green light for a US$300 million Inter-American Development Bank (IDB) loan to help finance highway projects throughout the country. The funds will be used to finance work on the Interamericana Norte highway and to widen 10 bridges to four lanes on the road between the cities of Barranca and Arizona. The government affirmed that the loan would also be used to complete various stretches of the San Carlos highway. The financing is the initial portion of an US$850 million loan approved by the IDB in
“We have a major infrastructure deficit. We are going for the system of concessions to private entrepreneurs and companies, where there are major Spanish investors,” says Melvin Saenz Biolley, Costa Rica’s ambassador to Nicaragua. “Another key issue is ports. Upgrading port infrastructure by concessions to private operators is a move that is already attracting attention from companies in the U.S., Europe and Latin America.” The major ports of Caldera on the Pacific coast and Limon on the Caribbean coast are both undergoing redevelopment.
“One of the main challenges that Costa Rica faces is that 80% of international trade enters and leaves through the port of Limon,” says Monica Araya, president of the Chamber of Exporters of Costa Rica (Cadexco.) “The other is to build a coast-to-coast railroad. This is important, not only for reducing logistics costs – 60% of total fuel imports is for the transportation of cargo. Establishing a cross-country railway would even reduce inflation and make Costa Rica more competitive.”