Business

Costa Rica woos European tourists, French investment

Friday, May 19, 2017

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SAN JOSE, Costa Rica (AFP) — Increasing numbers of Europeans are boosting Costa Rica's thriving tourism industry, but lagging infrastructure and regional connectivity are crimping its potential, an investment conference in San Jose heard last week.The country stands head and shoulders over the rest of Central America in tourism numbers, receiving 2.9 million visitors a year, many attracted by its eco-friendly image, Tourism Minister Mauricio Ventura told a seminar of French foreign trade advisers from across the region.

Americans account for around 40 per cent. Europeans represent a quarter, but their numbers are rapidly growing following the introduction over the past year of direct flights to Britain, France, Germany and Switzerland.

Europeans also spend more time in the country — an average of 18 nights compared to 12 for Americans — meaning more tourism revenue, Ventura said.

“Other countries in Central America have a great deal to do to improve” their images to achieve Costa Rica's level of success, said Thierry de Pierrefeu, former Honduran tourism minister.

He noted that the reputation for violence in Guatemala, El Salvador and Honduras scares off most tourists.

Pia Lackman, the manager for Air France-KLM in Central America, said her airline had found its new direct flights to Costa Rica to be “very successful”.

But she pointed out that airlines need “a mix of tourism and business” travellers on their long-haul flights, and that there were few of the latter flying to Costa Rica.

There was also a lack of connectivity, she said, explaining that the region's flight hub was neighbouring Panama, which received far more Air France flights.

The seminar also presented investment round table discussions, including on public-private partnerships (PPP) to get big infrastructure projects built.

They were needed in Costa Rica because “it must be recognised we're a poor country, we're not a country that generates wealth”, for instance from oil, said Guiselle Alfaro Bogantes, deputy minister for infrastructure and concessions.

But the attendees were reminded that a PPP to modernise San Jose's airport 17 years ago got bogged down in a costly legal fight between the government and the firm chosen to run it, causing the parent company to go bankrupt.

Round table participants, among them representatives from France's Treasury and the bank Societe Generale, said the key to prevent such fiascos was to balance risk and the need for private firms to make profit, while clearly defining the policy, legal and technical framework of a project.

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