(MENAFN- Costa Rica News) The post From the Factory to the Cloud: How Did Costa Rica Become a Per Capita Leader in Digital Exports and How Can it Bridge the Gap? appeared first on The Costa Rica News.

“Costa Rica is the country in Latin America with virtually zero regulatory barriers, that is, to the import of this type of trade. We are the number one country in per capita exports of modern or digital services, meaning everything that can be sent or supplied over the internet,” explains Ricardo Monge, president of the Central American Academy. It is worth highlighting the importance that Costa Rica has achieved within this services market, despite being smaller than other economies in the region.

Extra points for specialized services

The presence of specialized services, the expert points out, is already key to national production.“It's a sector with extremely high added value that has shown growth rates of around 14% per year over the last few decades,” he notes.

According to the expert, there are, however, challenges to address in order to take advantage of the expected potential.“It's a very human-resource-intensive sector. I think it's a niche market that is growing globally more than the growth of current services or goods,” he said.

“Therefore, we should invest in this sector by strengthening the country's human resources and continuing with all possible improvements in telecommunications,” he added.

Finally, he points out that while there are no tariffs, there are regulations that could complicate their commercialization. Latin America, primarily, is the cradle of these obstacles, whose addressing could expand opportunities for Costa Rica.

“We export primarily to the United States because the regulations there are very clear, and we also export to Europe. Latin America is perhaps our smallest market, and it is where we have the most regulations. Perhaps at the Latin American level, we should make the greatest effort to eliminate these regulations so that trade between us in digital services is more fluid.”

Specialized computer services

The diversity of functions that can be performed virtually constitutes a key input for the possibilities offered by specialized services. In 2023, almost two-thirds of the GDP of the countries in the region were associated with service activities. And in the period 1990-2023, this sector increased its relative weight in the economies of most countries in the region by between 7.7 and 15.8 percentage points, is pointed out.

Each at its own pace in Central America

Returning to international details, the State of the Region analyzes how the economic profile of the countries changed in just a few decades.“The economies of Central America and the Dominican Republic experienced profound transformations as a result of the replacement of the import substitution strategy, which predominated during the third quarter of the 20th century, with a strategy of export promotion and attraction of foreign direct investment, tourism, and remittances,” they explain.

“For three and a half decades, the services sector and, to a lesser extent, industry gradually displaced the agricultural sector,” they elaborated. The detail is that each country has moved at its own pace. In this way, the economic differences between countries have multiplied almost fourfold. It also highlights that while there is growth greater than that Compared to Latin American averages, they have not made the optimal leap in terms of quality.

“This performance has been associated with the incorporation of an increasing number of people into the labor market, not with improvements in labor productivity,” they point out.

As proof, they point out that in 2023, the average GDP per worker in the region was $36,688. This figure is 16% lower than the Latin American average. The figure is just 33% of the average level of this indicator in the countries of the European Union and 24% of that of the United States.

The post From the Factory to the Cloud: How Did Costa Rica Become a Per Capita Leader in Digital Exports and How Can it Bridge the Gap? appeared first on The Costa Rica News.

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