Convergencia Research, Consultoría especializada en Latinoamérica y Caribe
Friday, September 03, 2021

Costa Rica aims to add US$ 500 million annually to its economy with digital nomads

Authorities hope that some 10,000 foreigners will settle down to take advantage of the benefits offered by the new legislation. But experts warn of the fragility of connectivity in the country.

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.

Last news and analysis

América Latina · Convergence

28/03/2024

Convergencialatina returns on Wednesday, April 3

Puerto Rico · Fixed Broadband

28/03/2024

Puerto Rico must deploy fiber optics in more than half of the island's homes

The data came from a Fiber Broadband Association webinar that revealed the island's situation in FTTH services. There is a plan for the footprint to reach one hundred percent of homes in 2027 financed by federal funds and privately executed.

Puerto Rico · Fixed Broadband

28/03/2024

Puerto Rico must deploy fiber optics in more than half of the island's homes

The data came from a Fiber Broadband Association webinar that revealed the island's situation in FTTH services. There is a plan for the footprint to reach one hundred percent of homes in 2027 financed by federal funds and privately executed.

Uruguay · Pay TV · Internet & OTT · Operators

27/03/2024

Through agreements with Claro and Movistar, cable operators expand their Internet offer

These are agreements of different types, which include leaving the last mile for the cable operator or contracts for available bandwidth. Antel could join with infrastructure leasing. Some cable operators are already building their own networks.

Paraguay · Operators

26/03/2024

Government analyzes partial privatization of Copaco

The state operator is going through a delicate moment. Its income does not cover operating expenses and it must fulfil a debt obligation of US$110 million. Furthermore, the lack of investments led to the obsolescence of its infrastructure. Oscar Stark, president of the firm, states that alternatives are being evaluated to obtain the necessary funds, including the possibility of adding private partners. And he believes that in 18 months "the situation will be resolved."

Search news