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    - Archive photo via Municipality of San José City - |
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Published on Thursday, July 14, 2022
By the A.M. Costa Rica wire services
Costa Rica is the leading country in Investment Monitor’s 2022 Inward FDI Performance Index, according to the Investment Monitor journal report, which is focused on business and foreign direct investment news.
The index measures a country’s inward investment levels against its gross domestic product (GDP) using our FDI Projects Database which tracks greenfield projects.
This means that Costa Rica, with a score of 13.4, received more than 13 times its fair share of inward greenfield Foreign Direct Investment (FDI) compared with what could be expected given its level of GDP.
In that regard, Costa Rica is punching well above its weight in FDI terms, according to the report.
Costa Rica specializes in attracting companies from the technology, business and professional services and life sciences industries. According to our FDI Projects database, in 2021, almost two-thirds (63%) of Costa Rica’s total inbound greenfield FDI came from these three sectors.
Although the country continues to be a key outsourcing hub, investors are seeing its potential for manufacturing and R&D operations, particularly relating to life sciences and tech.
U.S. technology-enabling business service company Concentrix announced it was creating 1,000 new jobs in Costa Rica in the first half of 2021.
Other significant investments included Intel announcing a new $250m expansion of its facility in San Antonio.
Terumo BCT
announced it would open a new medical
device product manufacturing facility in
Cartago, creating 700 jobs.
According to the report, the world's largest economies are underperforming. China and the US are ranked towards the bottom of the Inward FDI Performance ranking. China ranks 96 (last), while the US ranks 94.
Although the U.S. is the largest FDI destination market, it is a larger contributor to the world economy. So, while the U.S. receives 9.3% of global FDI, it accounts for almost one-quarter (24.6%) of the world’s GDP. The U.S. is also the largest source market for FDI. It creates almost three outbound projects for every one inbound project received.
"China's performance in the index may come as a shock," they said. However, China’s inbound receipt of greenfield FDI has been in decline for several years.
Investor concerns over the U.S.-China decoupling and rising costs in China have caused investors to look at Asian neighbors. While this has been happening, China has become a much more prevalent economic powerhouse.
In 2000, China accounted for only 3.5% of the world's GDP. In 2021, this had risen to 18.1%. The International Monetary Fund estimates that China will account for 21.4% of global GDP by 2027.
The Inward FDI Performance Index examines the number of inbound FDI projects into each country as a proportion of the world's total. The result is then divided by the country’s GDP as a proportion of world GDP.
If the resulting value is a number greater than one, that means the country is receiving a higher proportion of inbound greenfield FDI than one may expect given its economic contributions to the global economy.
A score of less than one means the country is a smaller player in FDI terms compared with its levels of GDP. The FDI Project information is sourced from our FDI Projects database and GDP data is sourced from the International Monetary Fund.
The full expert's report can be reached at the Investment Monitor site. --------------------
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