The Juan Santamaria International Airport in San José.
Photo courtesy of Aeris Costa Rica
Costa Rica’s strong middle-class population and stable economy led to the development of the 37-acre (15-hectare) property in the city’s “Radial Coyol” logistics hub, which offers easy access to the San José International Airport and the country’s two major highways: Route 1, the Interamerican Highway; and Route 27, which connects San José to the Pacific port of Caldera.
“The hub is centrally located with very good connectivity to both coasts and the main seaports on the Atlantic and Pacific,” explains Aris Stamatiadis, manager of Central America at LatAm Logistic Properties. “If we have to ship out to either the eastern or western parts of the U.S., that’s very easy to do. It’s very nearby the main population areas, not only in North America but also in South America. It’s a very strategic place to receive merchandise and distribute.”
Stamatiadis notes that multinational companies including San Diego-based PriceSmart, Seattle-based Expeditors, Mexican dairy producer LaLa, Kraft-Heinz and Mexican electronic manufacturer Mabe are more comfortable with the Class A facilities for logistics available in Costa Rica.
“One of the keys to PriceSmart’s success is a very efficient and advanced logistics operation. Our new Regional Distribution Center in Alajuela, Costa Rica, will support this effort. Having a regional facility should enable PriceSmart to adequately stock multiple sales locations in Central America and positively impact service and value for our members,” said Rodrigo Calvo, executive vice president for real estate of PriceSmart Inc.
Going East, West, North or South Is a Snap
Costa Rica´s international trade dynamism has nurtured an ecosystem of players and suppliers ranked No. 1 in quality of supplier base by the World Economic Forum, and premium partners to enhance supply chain strategies are no different. The country has a host of global and local boutique, specialized firms in freight handling including Expeditors, Kuehne+Nagel, DHL, Fedex, UPS, Pegasus, Mudanzas Mundiales and Logitsa.
Logitsa Cargo Service is a short distance away in Alajuela, Costa Rica, in front of the San José International Airport, and is one the country’s fastest-growing logistics companies. Founded in 2009, the firm offers customs brokerage, freight forwarding through air, ocean and land, bonded warehouse space and local transportation.
Marvin Villalobos Álvarez, owner and CEO of Logitsa, says the country’s location and overall business climate is a major advantage for companies in terms of logistics. “Due to its strategic location at the center of Latin America, Costa Rica has become a preferred hub for companies to settle and invest,” he says. “With coasts on both sides of the country, ports in the Caribbean and the Pacific make available routing for cargo to and from different places in the world. International airports in Costa Rica connect people and cargo with many cities in the world promoting the trading process.”
“The business climate in Costa Rica is welcoming,” Villalobos says. “Companies in this country can thrive, and the economic and political stability provides a sense of certainty to investors.”
Private organizations and the Costa Rican government make efforts to ensure investors are well guided on the process they need to follow, and new regulations facilitate logistics operations to enhance performance under the free trade zone.
Some regions offer more possibilities for optimized supply chain operations. For instance, Guanacaste in the North Pacific just inaugurated a new cargo facility at Daniel Oduber International Airport. Puntarenas in the Pacific Coast opened a new platform at the Caldera Port, and Dutch logistics titan APM Terminals is building a brand-new $1-billion port on the Caribbean coast.
Free Trade Powerhouse Flexes its Muscle
According to Procomer, the agency in charge of promoting Costa Rican exports of goods and services, Costa Rica has free trade agreements which cover two-thirds of the world’s gross domestic product and over a third of the world’s population. Costa Rica is the only Central American country with a free trade agreement with China, and maintains 14 free trade agreements that provide access to 57 global trade partners including the U.S., Canada and the E.U.
Companies choosing to make new investments in Costa Rica can take advantage of tax incentives at industrial parks and office buildings throughout the country’s metropolitan areas.
“For MNCs or logistics companies the Free Trade Zone regime can be a valuable tool to optimize its supply chain strategy.” says Jorge Sequeira from CINDE. “The free trade zone in Costa Rica can allow companies, for example, to import goods free of tax and re-export free of tax. It provides incentives on tax exemptions on income, export, import and other duties for logistics services companies which meet its requirements. The regime is a longstanding program which meets World Trade Organization standards.”
Several business parks offering free trade zones exist around the country’s major metro areas, including Coyol Free Zone and Business Park in Alajuela, just 4.5 miles west of the San José International Airport. The high-tech park opened in 2007 and is occupied by several medical and advanced manufacturing companies including Medtronic, Abbott Vascular, Phillips and Moog.
Also, in Coyol is BES Free Zone and Greenpark, where the distribution center for pharmaceuticals and medications of the National Insurance Institute of Costa Rica is located, as well as other industry leaders.
La Lima Free Zone and Business Park is another state-of-the-art development in Cartago that caters to advanced manufacturing, life science, logistics, supply and services-based businesses which include Aligh Technologies, German electronics component manufacturer Zollner, Edwards LifeSciences and the future facilities of Swedish ostomy device manufacturer Coloplast.
Handling Bigger Ships at a Better Price
Several key investments have helped to amplify the country’s logistical advantages, especially as larger ships are able to access the Panama Canal.
In February, Netherlands-based APM Terminals is set to open Costa Rica’s newest deep-water port on the Caribbean coast. The 80-hectare Moín Container Terminal was built on an artificial island and is on track to become the most efficient port in Latin America. APM Terminals operates a Global Terminal Network in 60 countries.
“Costa Rica is preparing to inaugurate much more than a container terminal. The country is inaugurating a new era in its commercial relations with the world, and this will have a direct impact on the country’s economy and an important advance in the global connectivity ranking,” said Morten H. Engelstoft, CEO of APM Terminals.
The terminal’s 1,500-meter quay offers an access channel that is 18 meters deep and is equipped with 39 electric container cranes and six Super-Post Panamax gantry cranes. The port will be capable of handling container ships of up to 8,500 TEUs. The new port is expected to raise commerce in Costa Rica by 23 percent, according to a Qbis Socioeconomic Impact Study. The study estimates Costa Rica’s trade costs will decrease by up to 40 percent. For exporters of perishables, like pineapples, the new port is expected to hedge shipping costs and may reduce overall trade costs by 15 percent.
“The new APM Terminal is going to change the whole way of handling cargo in and out of Costa Rica,” says Carlos José Zúñiga, president of Grupo Mudanzas Mundiales, an integrated logistics, storage and mobility company focused on international trade. “Imports and exports will be expedited. It’s saving a lot of time, and the security that this new port will give you in the handling of cargo and the time savings will benefit the business.”
The Port of Caldera in the Central Pacific is a key to Costa Rica’s logistics success as well. Over the last eight years, a $55-million investment has increased its container unloading capacity from 17 to 44 containers per hour and has more than doubled overall productivity.
Connectivity Gives Businesses a Boost
As the main point of entry to Costa Rica, Juan Santamaria International Airport in San José has 936 weekly flights to 45 destinations around the world. Each year the airport receives more than 4.8 million visitors and is the second-busiest airport in Central America after Tocumen International Airport.
Increasingly, the country sees greater connectivity by air. Businesses flourish as a result.
“Our route development program has been able to significantly increase flights to Europe, including carriers like Air France, Lufthansa, Edelweiss and KLM,” says Rafael Mencia, executive director of Aeris. “Our service to the United States continues to be more solid and diversified with American Airlines, United, Southwest, Spirit, Jet Blue and Delta as the main carriers. We have direct flights to the main cities in the United States including New York, Miami, Dallas, Los Angeles, Fort Lauderdale, Charlotte, Chicago, Houston, Phoenix, Minneapolis, Denver, Boston and Baltimore; as well as to Canadian destinations such as Toronto, Calgary and Montreal. The development of tourism is the main reason for the traffic increase and the success of the air service development program, but it’s complemented by the advantages and increased air cargo given the country´s export capacity. Thus, it provides a sound and more comprehensive business model for airliners. Costa Rica has a very good name in Europe and the United States thanks to political stability and good economic development.”
In the past 12 months, the airport has handled 80,000 metric tons of imports and nearly the same amount of exports. Cargo is handled by UPS, Lan Cargo, FedEx Express and DHL, among others.
In July, DHL opened its expanded customer support facility in Heredia to serve its Americas region. The company’s investment of $15.6 million expanded its financial, customer and IT services as well as its human resources operations. More than 650 people work at the facility, with plans for 150 more in the next two years.
“Our divisions are growing, bringing more jobs to Costa Rica as the need for support in various areas increases,” said Mike Parra, CEO of DHL Americas Region. “This new DHL Customer Support Facility reflects the shift of DHL to more value-added activities, such as digitalization in customer service to enhance the customer experience.”
“The country is inaugurating a new era in its commercial relations with the world, and this will have a direct impact on the country’s economy and an important advance in the global connectivity ranking.”
— Morten H. Engelstoft, CEO of APM Terminals.
DHL has 50 percent of the market share in shipment volume in Central America and operates flights to and from Costa Rica, Guatemala, El Salvador, Honduras, Panama, Mexico and Miami.
The Daniel Oduber International Airport in Liberia, in the Guanacaste region, operates more than 120 weekly flights to cities in the U.S. and Canada. Primarily used as a passenger airport, its cargo capacities are growing with its convenient access to the Pan-American Highway.
With Costa Rica’s strategic location, moving goods into and out the country is easy. In 2017, some 24 percent of Costa Rica’s exports left the country via air, 53.5 percent by sea and 21 percent on land. With ports on both the Caribbean and Pacific Coasts, transporting products to either coast of both North and South America takes less time and saves companies money.
The new state-of-the art Caribbean port in Costa Rica will complement the new expansion at the Panama Canal. Though the canal has an increased capacity, certain Post-Panamax vessels are too large to pass through the canal. This makes Costa Rica an ideal platform for freight fragmentation, as well as a more productive point for cargo handling into Central America — a market of 60 million people.
“We have done several analyses with experts to assess that efficiency of cargo handling to Central America. Just by lowering freight in Moín as opposed to Colon, companies can save $1,300 for every 20-foot container in land transportation alone, not to mention the time saved on at least a 700 kilometers distance,” explains Karin Lachner, head of marketing for CINDE.
Costa Rica’s logistics advantages are only going to continue to grow as the market matures. The opportunities are as bountiful as the land itself.
This Investment Report was prepared under the auspices of the Costa Rican Investment Promotion Agency (CINDE), a private, nonprofit and apolitical organization that provides investment services for free. For more information, visit www.cinde.org or call its offices in New York at 212-984-0631 or San José, Costa Rica at 506-2201-2800.
Source link : https://siteselection.com/issues/2018/nov/costa-rica-a-natural-hub-to-reach-the-americas-and-the-world.cfm
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Publish date : 2018-11-12 20:50:31
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