Less Competence, Higher Prices

Due to weak competition in the local market, the prices of goods and services in the basic basket are significantly higher in Costa Rica than in nearby countries.

Friday, July 17, 2020

A report by the Organization for Economic Cooperation and Development (OECD), called the "Economic Study on Costa Rica", concludes that consumers in the country pay higher prices for milk, rice, vehicles and Internet services.

A relatively small number of large companies dominate the economy, indicating the need for better regulation to promote a more competitive business environment, says the OECD study released July 15.

Check out the "System for monitoring markets and economic situation in Central American countries", produced by CentralAmericaData.

For Luis Mastroeni, Director of Corporate Relations and Sustainability at Dos Pinos, there is a wide range of products on offer in the Costa Rican market. The director explained to Nacion.com that "... in the Costa Rican dairy market there are several companies and a great variety of brands in the different types of products. There is an opening process with other countries, particularly with the United States, which reinforces the trend towards a globalized market."

Alberto González, a member of the OECD's Economics Department, said that "... Costa Rica is an expensive country and many times it happens because of regulations that prevent competition. The situation of some markets in Costa Rica is the situation that has reached a bad balance."

The OECD representative believes that in the country there are no incentives to increase productivity, but at the same time there are certain sectors that, through high prices, extract income from the most disadvantaged classes.

In mid-May 2020 and after five years of managing its accession to the OECD, the OECD Council agreed to formally extend the invitation to Costa Rica to become the 38th member.

According to Pilar Garrido, Minister of National Planning and Economic Policy, "... the Presidential Economic Council took up again the issues of distortions of specific markets, for which they use reports from the Commission to Promote Competition (Coprocom).

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