Costa Rica: Lack of Water is Paralyzing Investments

$320 million is the value of investments in hotel projects in the touristic development pole Gulf of Papagayo that have failed to start due to lack of water.

Friday, March 17, 2017

Unable to present a letter of guarantee of water resources, 11 tourism development projects planned for the Gulf of Papagayo in Guanacaste, have failed to start. Lack of water is a problem that has affected the development of the area for years.

Furthermore, "...Nine concessions with 11 hotels on the Papagayo development center in Liberia and Carrillo are stalled. Of those hotels, four have already completed their paperwork phase, and seven have not even started that stage due to the impossibility of submitting a letter ensuring that water resources are available." reports that "...The four that have already undertaken the official processes have a combined investment of $174 million. They are the hotels Melia Paradisus Papagayo, with a $90 million project with 412 rooms; Yu Papagayo, with $22 million and 151 rooms; The Point, with $55 million and 150 rooms; and the expansion of the Grand Papagayo, with $7.8 million and 60 additional rooms, according to data from the tourism pole department. The other five concessions with seven hotels have a combined value of $145.7 million. Among these are the hotels Punta Mar, Costa Mona and two Altepe hotels and three condohotels."

In regards to possible solutions, authorities at the Aqueducts and Sewers department explained that in 2018 it is expected that the aqueduct Las Trancas will be completed, which will supply the tourist resort area and neighboring communities. Yamileth Astorga, chief executive of AyA, told that "... the solution is so close that next Wednesday the board of this entity will be chosing the construction company from among final three bidders."

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More on this topic

More Time to Develop Tourism Projects

June 2019

Because of the delay of the Costa Rican authorities to solve the problem of water supply in the Gulf of Papagayo, developers request that the terms of the concessions granted to them to develop tourism projects in the area be extended.

The Instituto Costarricense de Turismo (ICT) has already received requests for concessions to be extended, because some of the projects that have not been completed have already consumed half of the time they were granted.

Tourism: Investment Reactivation

April 2019

Now that the works that will allow the water supply to the main tourist centers of the Gulf of Papagayo, in Costa Rica, are finished, it is expected that they will restart the investments paralyzed years ago.

After the opening of Las Trancas-Papagayo Bahía Aqueduct on March 1st, which was achieved after an agreement between the Costa Rican Institute of Aqueducts and Sewers, the Costa Rican Institute of Tourism and the private sector, there is optimism that investments can be reactivated in at least 11 projects.

Details of a hotel project worth $69 million

October 2015

An environmental impact study has been submitted in Costa Rica for a 14,000 square meter hotel development in the touristic region of the Gulf of Papagayo, Guanacaste.

In the environmental impact assessment (EIA) for the "DP6 Papagayo Project", filed with the National Environmental Technical Secretariat in July 2015 by Hoteleras Playa Pochote S.A., it is indicated that the hotel tourism development will have a maximum of 318 rooms.

Status of Major Tourist Destination in the Region

January 2015

In the Gulf of Papagayo the government of Costa Rica has already granted 35 areas in concession, which occupy almost 90% of the total area to be developed.

At the moment nine resorts are operating, three are under construction and it is expected that design plans for two more will be submitted this year.

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