The Costa Rican government on August 11 enacted the so-called Digital Nomad Law, which aims to attract foreign workers and service providers to the Central American country to promote the reactivation of tourism and the country's economy in general. However, for the bet to work, the project will bring challenges in terms of connectivity offered by the different geographical areas of the nation.
The new regulation to attract digital nomads establishes that foreigners will be able to stay in Costa Rica for two years with a renewal of the stay in the middle of the period. In turn, they will be exempt from paying taxes on the import of any technological and telecommunications equipment that they need to fulfill their labor obligation. In addition, to facilitate mobility, all driving records issued abroad and that are current will be accepted as valid.
The requirements to apply under this legislation are to have an income greater than US$ 3,000 per month (if established with the family, it must be greater than US$ 5,000). The interested party must also pay for the visa process and have health insurance that covers the applicant and their family throughout their stay.
Expectations and challenges. The government expects at least 10,000 digital nomads to settle in Costa Rica, which would stimulate the economy worth about US$ 500 million per year due to their consumption, from food to hiring professional services.
The government has set up 32 Tourist Development Centers (CDT, in Spanish) that are in a position to receive these digital nomads.
However, the entry into force of this law will also bring challenges, especially concerning connectivity. In this sense, the Chamber of Information and Communication Technologies pointed out the need to improve Internet speed, especially in areas outside the Greater San José Metropolitan Area, the country's capital.
Edwin Estrada, former Minister of Telecommunications, and Ignacio Trejo, co-founder of Cenfotec, a university specialized in technologies, affirmed in the Think & Tech event, on digital nomads, that tourists who carry out remote jobs look for places with sufficient bandwidth and symmetrical connections.
According to a study by InsureMyTrip, published in Forbes, Costa Rica is the seventh best global destination for digital nomads to settle. However, according to the global Speed ??Test index, published last year, the country ranks 80th in the world regarding the speed of its fixed networks, with an average download of 43.77 Mbps, when in the world is 96.43 Mbps.
As for mobile networks, the country ranks 77, with an average mobile data download of 29.01 Mbps, when the world average is 47.20 Mbps.
Added to this is the official initiative to launch 5G in the country, although Carlos Alvarado’s government has not yet made progress in defining the frequencies that it will allocate to this deployment or set a date for the spectrum tender.
The new law aimed at attracting digital nomads can be very successful for the Costa Rican economy as long as it knows how to give emphasis to connectivity.