UPDATE OF COSTA RICA HANDBOOK

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-00891A001300070001-2
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 34
• Document Creation Date: December 12, 2016
• Document Release Date: June 4, 2001
• Sequence Number: 1
• Publication Date: December 1, 1972
• Content Type: REPORT

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No. 0590
December 1972
Update of Costa Rica Handbook
Please replace the September 1970 edition of the Costa Rica Handbook with
the attached. A new map is included, but please retain the dividers.
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Page
Location . . . . . . . . . . . . . . . . . . . . . . . . . 1
Area ..........................1
Climate . . . . . . . . . . . . . . . . . . . . . . . . . 1
Topography . . . . . . . . . . . . . . . . . . . . . . . 1
Natural resources . . . . . . . . . . . . . . . . . . . . . 2
Human resources . . . . . . . . . . . . . . . . . . . . . 2
Growth rates and trends . . . . . . . . . . . . . . . . . . 1
Income distribution . . . . . . . . . . . . . . . . . . . . 1
Main sectors-trends in agriculture and industry . . . . . . . . 2
Transportation and communications . . . . . . . . . . . . . 3
Government economic policy and financial system . . . . . . . 4
Foreign trade . . . . . . . . . . . . . . . . . . . . . . . 5
Balance of payments . . . . . . . . . . . . . . . . . . . . 5
Historical summary . . . . . . . . . . . . . . . . . . . . 1
Structure and functioning of the government . . . . . . . . . 1
Political dynamics . . . . . . . . . . . . . . . . . . . . . 3
Security system . . . . . . . . . . . . . . . . . . . . . . 5
Communist party and leftist subversive groups . . . . . . . . . 1
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Economic and technical assistance programs . . . . . . . . . . 1
Investments . . . . . . . . . . . . . . . . . . . . . . . 1
Trade and trends . . . . . . . . . . . . . . . . . . . . . 1
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Costa Rica is an oasis of democracy and social progress in the generally
backward and politically roiled Central American area. Since its beginning,
the country has enjoyed a more stable society and peaceful development
than its neighbors. The population is fairly homogeneous and, by Latin
American standards, for the most part literate and prosperous. The govern-
ment has a tradition of responsiveness to the popular will and commitment
to the general welfare of its citizens.
Costa Ricans have become accustomed to a high level of social services,
which are provided by relatively well-developed public institutions, but there
are pockets of neglect where unrest is becoming serious. The Figueres
government, installed in May 1970, has made a strong commitment to social
reform. However, promises of a short-range war on hunger, poverty, and
unemployment and a longer range national development plan have yielded
few concrete results. Some programs designed to ameliorate the problems
and frustrations of the unemployed and youth are beginning to emerge, but
not with the sense of urgency sounded during the 1970 election campaign.
Political restiveness is also increasing as all parties prepare for the 1974
elections. President Figueres, who cannot succeed himself, is the last of a
group of politicians who have dominated political life for the past 25 years.
His departure will allow younger, and possibly more capable, political
hopefuls to move into leading positions. Although emerging social and
political strains will continue, Costa Rica is better equipped to deal with
them than most other Latin America nations.
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Costa Rica spans the Central American isthmus between Nicaragua and
Panama. It lies within 900 nautical miles of the Florida Straits and within
700 miles of Cuba.
Occupying an area of approximately 19,700 square miles, slightly
smaller than West Virginia, Costa Rica has a maximum northwest-southeast
extent of about 190 miles and a maximum northeast-southwest dimension of
about 140 miles. The perimeter of the mainland totals approximately 1,215
miles, of which about 415 miles are land boundaries.
Costa Rica has a hot and humid tropical climate, with distinct wet and
dry seasons. The wet season generally is from early May through October or
November and the dry season from early November or December through
April. In the northeast, however, the wet season is longer, extending into
December or January, and at some places a second dry season occurs in
September or October. Temperatures have little seasonal variation-generally
less than ten degrees Fahrenheit throughout the year. Mean daily maximums
are in the 80s and 90s (F) in the lowlands and in the 70s and 80s in the
highlands. Mean daily minimums are mostly in the 60s and 70s; slightly
lower temperatures occur at the higher elevations. Extreme temperatures
range from the low 40s to nearly 100 degrees (F).
Topography
About three fourths of Costa Rica consists of densely forested high-
lands and plains; the remainder is, for the most part, lightly forested and
comprises mainly lowland plains, an upland basin, and a small coastal
highland. Dense broadleaf evergreen forests cover much of the northwest-
southeast trending highlands that extend the length of the country, a large
plain between the highlands and the Caribbean, and parts of a few small
plains in the south. The highlands are characterized by rugged hills and
highly dissected, sharply cresting mountains. Elevations generally increase
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from 5,000 feet in the northwest to more than 10,000 feet in the southeast;
the highest is 12,533 feet. The plains are predominantly smooth except for
some small dissected areas and scattered low hills. Numerous streams drain
the highlands and plains and flow to the Caribbean Sea or to the Pacific
Ocean. A large upland basin called the Meseta Central (or central plateau)
has extensive coffee plantations and most of the population centers. Located
in one of the most active seismic regions of the world, Costa Rica is subject
to frequent, damaging earthquakes and also to volcanic activity. In addition,
huge sea waves occur occasionally along the Pacific coast, and landslides are
common during and after heavy rains in some highland areas.
Apart from a rich agricultural endowment, Costa Rica has a generally
poor resource base. About 30% of the land is devoted to agriculture. Only
8% is planted in crops, however, the remainder being fallow or natural
pastureland. About one third of the forest land, which makes up 60% of the
total area, is suitable for agriculture, but the high cost of clearing it and
constructing access roads has impeded such use. Timber resources are exten-
sive, being estimated at 40 billion board feet, and commercial lumbering is
becoming one of the country's most important industries.
Costa Rica has no known commercial deposits of mineral fuels but its
hydroelectric potential is one of the highest per capita in Latin America.
Mining at present is limited to small amounts of manganese, gold, salt, and
construction- materials. The most important known mineral resource is a
bauxite deposit at Valle de El General that contains an estimated 150 million
metric tons of ore averaging 35% alumina. Exploratory work is under way on
several copper and manganese deposits, and the commercial possibilities of
titaniferous iron sand deposits along the Pacific coast are being studied.
Cement production began in 1964 with the completion of a plant adjacent
to extensive limestone deposits at Cartago. The plant produces both for the
domestic market and for export.
Costa Rica's estimated population as of 1 July 1972 was 1,836,000
with a density of about 93 persons per square mile. Its annual growth rate of
about 2.8% (mid 1970 - mid 1971) represents a decline from earlier rates,
probably as a result of family planning assistance programs. The rate,
however, is still high and is one of the major factors contributing to Costa
Rica's economic difficulties. Typically, there is a large percentage in the
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younger, dependent age groups; according to 1970 figures, 46.4% were under
15 years of age.
The population is ethnically more homogeneous than that of most
other countries in Latin America. Almost 98% of the population is white or
near white, including some mestizo; 2% are Negro; 0.3% Indian; and 0.1%
Asian. Most Costa Ricans are descendants of the early Spanish settlers from
Extremadura and Andalusia, later supplemented by immigrants from Castile.
In the urban areas of the central valley (Meseta Central), the proportion of
persons of pure Spanish descent is very high. The mestizos, on the other
hand, are more often in the lower classes and live in rural areas. Some 27,000
Negroes of West Indian origin constitute the only important minority within
the country, and they reside mainly in Limon on the Atlantic coast.
Spanish is the native tongue of more than 98% of the population. The
Jamaican dialect of English is the mother tongue of most of the Negro
population. About 95% of the population is Roman Catholic although the
percentage of participating Catholics is much smaller.
The population is essentially rural. The urban population, 37% of the
total, is concentrated for the most part in the metropolitan area of San Jose
(estimated at 362,731 in the 1970 census), making the province of San Jose
the only one with more than 50% living in urban areas. The literacy rate of
the working age population (15-64 years) was about 80% in 1970 and is
probably higher today. The labor force numbered approximately 530,000 in
1970; only about 6% of it was organized.
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From 1959 to 1969 the economy of Costa Rica grew at an average
annual rate of 6%, or about 2.5% per capita. In 1971, Gross Domestic
Product (GDP) per capita was nearly $555 on a purchasing power parity
basis, the second highest (after Panama) in Central America. Economic
growth for 1959-64 was erratic and averaged only 4.5% annually, in part
because drought and the eruption of the Irazu volcano prevented any gains
in 1964. Since that year, however, the growth rate has been one of the
highest in Latin America, averaging 8%. This growth has been based largely
on rising levels of foreign trade, private investment, and government
spending.
After rising 3% annually during 1961-64, the cost of living stabilized in
1965-67. In 1968, however, foreign exchange restrictions limited the dis-
sipation of mild inflationary pressure through import growth, and the cost of
living rose by 4%. The increase amounted to only 2% in 1969, when
monetary expansion slowed, but rose again to 3.3% in 1971.
Costa Rica is expected to sustain fairly high economic growth rates
during the next several years. Mineral development-mainly involving the
opening of a bauxite mine and construction of a $60-million alumina
plant-and a further large gain in banana exports are expected to provide the
major impetus to growth. Manufacturing output should continue to grow
rapidly, though perhaps not at the rate of the 1960s. The pace of economic
expansion, however, has been slowed somewhat by a fall in banana prices in
the late 1960s and a drop in coffee prices in 1971.
Income is more evenly distributed in Costa Rica than in the rest of
Central America, and poverty is less severe than in much of Latin America.
Still, a substantial portion of the population is impoverished by standards of
developed nations. The Costa Rican small farmer, for example, although
better educated than most Latin American campesinos, receives little if any
technical assistance from public institutions. He is reluctant to take on credit
obligations that may imperil the little he owns, yet he is often indebted to
loan sharks for food and other essentials. Much of his low income may go for
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some form of land rental. Urban poverty is most serious in the Caribbean
port city of Limon, but is continually aggravated in all towns as the rural
unemployed flock to the cities.
The large majority of Costa Ricans enjoy a comparatively high level of
social services.
Main sectors-trends in agriculture and industry
Agricultural production has been expanding rapidly, achieving a 7%
annual growth rate during the 1960s. The government has contributed
significantly by providing price supports, storage and credit facilities, and
research and extension services. Production growth has been greatest for
domestic food crops as a group, but some export crops also have made gains.
Nevertheless, agriculture continues to be handicapped by technical deficien-
cies, inadequate marketing and irrigation facilities, and a lack of farm-to-
market roads.
Land distribution is unequal, with only 6% of the farms comprising
62% of the farmland. At the other extreme, a little more than half the farms
make up less than 5% of the farmland. In between are a large number of
medium-seized farms that make some use of modern techniques and provide
a moderately good livelihood. Three fourths of all farms, embracing 85% of
the farm area, are owner-occupied. The others are worked by renters,
sharecroppers, or squatters.
The chief exports are bananas and coffee. Bananas have shown the most
rapid growth in output in recent years and in 1969 replaced coffee as the
leading export. After stagnating in the early 1960s, banana production more
than doubled during 1965-68 as a result of both expanding acreage and
improving yields. Two large US companies (United Fruit and Standard Fruit)
dominate the industry. One of these companies and several other importers
supplement their production with that of numerous small growers operating
under contract. Coffee accounted for about one fourth of agricultural
production and two fifths of export earnings during 1964-68, but is grad-
ually declining in importance because of the unfavorable outlook for world
market prices and the quota limitations under the International Coffee
Agreement. In late 1968 Costa Rica for the first time sold a large portion of
its coffee surplus to the Soviet Union; other surplus coffee sales were made
to the USSR in 1970, 1971, and 1972. Costa Rica also produces sugar,
cocoa, and small amounts of cotton for export.
Costa Rica 11-2
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The country raises a variety of crops for domestic consumption and has
attained self-sufficiency in most basic items, except corn and beans. The
livestock industry (especially cattle) has been expanding rapidly and now
accounts for about 18% of total agricultural production and 9% of total
exports. The dairy industry is the most developed in Central America and
small amounts of certain dairy products are exported to neighboring coun-
tries. Commercial fishing, involving mainly the catching and processing of
shrimp, lobster, and tuna for export, is a minor economic activity. Lumber
production is estimated at 175 million board feet annually, nearly all of
which is used domestically. Costa Rica has one oil refinery. Its electric power
industry is the largest in Central America; capacity exceeds demand by about
20%. The Aluminum Corporation of America (Alcoa), expects to complete
by the late 1970s a $60-million alumina plant with an annual capacity of
400,000 metric tons. The plant could export alumina worth $25 million
yearly and yield approximately $4 million in revenues, wages, and payments
annually.
During the 1960s, manufacturing output grew rapidly and became more
diversified, in part because of the stimulus provided by the formation of the
Central American Common Market. An average annual growth in real terms
of about 9% in 1962-68 raised output from 16% to 19% of GDP. Preliminary
data show that exports of manufactured goods amounted to over $54
million in 1970, compared with $19 million in 1965.
Transportation and communications
Transportation and communications in Costa Rica barely satisfy
existing requirements. The major rail, highway, and civil air routes radiate
from San Jose, which also has the country's only international airport. Costa
Rica has 407 miles of railroad. The rail line from the principal port of Limon
on the Caribbean coast through San Jose to the second-ranking port of
Puntarenas on the Pacific coast is by far the most important transportation
feature. It passes through the most heavily populated and economically
productive area of the country and carries the exports and imports for San
Jose and the highlands region. Highways are of considerable importance to
the economy; 11,800 miles of roads, of which 3,800 miles are improved,
provide essential feeder services to other transport media and connect
agricultural regions, processing plants, and market places. The Inter-
American Highway extends northwest-southeast through the country and
forms the backbone of the road system.
Domestic civil aviation has only minor significance, mainly because of
the small size of the country. In shipping, Costa Rica owns one merchant
vessel of 5,000 registered gross tons.
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Domestic telecommunications facilities are generally poor, but interna-
tional facilities are above average for Central America and satisfy most
requirements.
Government economic policy and financial system
Government economic policy of the last two administrations has
focused on diversifying and otherwise promoting both industrial and agricul-
tural growth while preventing excessive inflation. Industrial development has
been stimulated by the 1959 Industrial Development Law, by the formation
of the Central American Common Market (CACM), and by expanded credit
facilities. In agriculture, price supports for the basic domestic consumption
crops strengthen production incentives, and fiscal measures, selective credit
extensions, and marketing assistance have promoted diversification.
In recent years, the central government's expenditures have con-
siderably exceeded revenues. Expenditures increased 25% during 1971 over
1970, while revenues rose by less than 5%. The budget deficit was over 20%
of expenditures in 1971, compared with 10% in 1970. The deficit was
financed largely through external borrowing in 1965, borrowing from the
Central Bank in 1966 and 1967, and bond sales to the private sector in 1968,
1969, and 1970.
Import duties remain the government's main source of revenue, but
their share of the total income fell from 45% in 1965 to 23% in 1970. The
decline reflects expansion of duty-free imports from CACM, liberalization of
import duty exemptions under the 1959 Industrial Development Law, and
the shift from import duties to excise taxes on gasoline with the beginning of
oil refining. Direct tax revenues increased sharply during 1967-1968, pri-
marily as a result of temporary surcharges on property and income taxes.
The country's banking system consists of the Central Bank, four govern-
ment-owned commercial banks, and branches of two foreign banks. Other
financial institutions include the National Insurance Institute, the Workers
Bank, and the National Housing and Urbanization Institute, which makes
housing loans. In recent years, about 20 privately owned finance companies
have been established, primarily to extend consumer and commercial loans.
I n May 1969, congress authorized a national savings and loan system to grant
housing loans. There is no organized stock exchange, but an active bond
market specializes in central government securities, bonds of various govern-
ment agencies, and mortgage bonds.
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Foreign trade
Because of its small size, lack of mineral resources, and relatively minor
industrial capacity, Costa Rica depends heavily on imports for various
industrial materials, consumer goods, and capital equipment. Imported con-
sumer goods, for example, account for about 15% of private consumption
expenditure. Imported producer goods and construction materials make up
some 35% of gross fixed investment. To finance needed imports, the country
exports mainly tropical agricultural commodities. In addition, greatly in-
creased sales of meat and manufactured goods have helped to boost exports.
Nevertheless, the country's trade deficit climbed from $55 million in 1969
to $117 million in 1971;. the deficit now equals about one third of imports.
The US remains Costa Rica's major trading partner, purchasing 47% of its
exports in 1970 and supplying 35% of Costa Rica's imports. The import
percentage is the same as 1969, but has declined from 46% ten years ago.
This is due, in part, to increased imports from CACM nations. Other
important trading partners include the European Common Market countries
(especially West Germany) and Japan. Trade with Communist countries was
negligible until 1968, when Costa Rica first began selling coffee to the
USSR. The Figueres administration has been negotiating with several East
European countries for increased trade.
Balance of payments
Costa Rica has experienced balance-of-payments problems since 1962
because of increased budget deficits financed partly with Central Bank
credits. The consequent monetary expansion stimulated imports and caused
growing payments deficits. This continued heavy volume of imports boosted
balance-of-payments deficits to $86 million in 1970 and Costa Rica's net
foreign exchange reserves dropped by some $12 million, to a level of $26
million at the end of 1970. In the first nine months of 1971 imports were
11% higher than in the comparable period in 1970; simultaneously, exports
rose by less than 2%. Foreign exchange reserves continued to fall in the early
months of 1971. As a result, in June 1971 a dual exchange rate system was
re-established: the official selling rate remained unchanged at 6.65 colones
per dollar, while the free market rate was allowed to move to 8.60 colones.
At the end of 1971, net foreign exchange reserves stood at $36.8 million.
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III. POLITICAL SITUATION AND TRENDS
Historical summary
At the time of the Spanish conquest, there were fewer Indians in Costa
Rica than in the rest of Central America and only an insignificant number of
these survived the first years of Spanish domination. The lack of a native
labor supply made the colony unattractive to immigrants, but those who did
come were hardy farmers whose descendants today are an industrious people
more completely European in blood than those of any other Latin American
country except Uruguay and Argentina. Concentrated in one small area on
their central plateau, and able because of their geographic position to remain
aloof from the continual conflicts among the other states, the Costa Ricans
attained a truly republican government earlier than most of the American
republics.
Even in the first years of independence, the Costa Ricans suffered less
from internal political strife than did their neighbors. There were brief
struggles among the various towns arising from disputes over the location of
the capital, and there were periodic revolts and coups, but they caused little
bloodshed or destruction. Political affairs were dominated by a few promi-
nent families. Notable among the early presidents was Braulio Carrillo
(1835-37 and 1838-42), who first promoted coffee growing. His subdivision
of the common lands formerly held by the towns considerably increased the
number of small landowners, and these peasant proprietors gave the country
a political and social stability that made it different from its neighbors. The
first real election in Central America was held in Costa Rica in 1889. The
only interruptions to constitutional government in the 20th century were a
brief military intervention in 1917 and the civil war of 1948, which occurred
when forces led by Jose Figueres revolted against the arbitrary annulment of
an election (of Otilio Ulate) and installed a government junta, which pre-
pared a new constitution and confirmed the election of Ulate. Under the
presidencies of Ulate (1949-53) and Figueres (1953-58) economic and social
development continued. Following an interlude of more conservative govern-
ments, Figueres was again elected president in 1970.
Structure and functioning of the government
The present constitution (the ninth) was promulgated in 1949, follow-
ing the 1948 revolution. The document is similar to its predecessor, the
constitution of 1871, with modifications to achieve more representative
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government, better safeguards against political abuses, and broader coverage
of social and economic matters. It provides for a unitary, representative
system, with powers distributed among executive, legislative, and judicial
branches designed to operate on the basis of checks and balances.
After Figueres' present term, a citizen will no longer be able to seek the
presidency if he has held that office before, according to a new con-
stitutional amendment. The president exercises executive authority. His
formal power is somewhat less than most other Latin American chief
executives but, nevertheless, is quite broad and is augmented considerably if
he has sufficient influence within his party and his party dominates the
legislature.
The unicameral and popularly elected Legislative Assembly has 57
deputies apportioned among the seven provinces on the basis of population.
Election is by a system of proportional representation and re-election im-
mediately after a four-year term is prohibited. Costa Rica's legislature
functions with more independence and has a larger actual role in the
government than any other Central American legislative body.
Costa Rica's judicial system is highly centralized. With the exception of
the Supreme Electoral Tribunal, all courts and all officials and employees of
the judiciary are subordinate to the Supreme Court of Justice. The 17
Supreme Court justices are elected by the assembly for an eight-year term
automatically renewable unless terminated by a two-thirds vote of the
legislature. By a two-thirds vote the Supreme Court may declare uncon-
stitutional laws passed by the assembly and decrees issued by the executive.
The Supreme Court is the highest court of appeal and has within its exclusive
jurisdiction the issuance of the writ of habeas corpus.
In addition to the three branches of government, the governmental
structure includes 32 autonomous and semi-autonomous agencies which have
come to occupy an important national position. These agencies have juridical
standing and legal independence. One important area in which the
autonomous institutions are controversial is the country's banking system,
which is made up of several of these agencies.
The constitution divides the national territory into provinces, cantons,
and districts. The seven provinces are divided into 69 cantons (cantones),
subdivided into 367 districts (distritos). Government at the provincial level is
not highly developed. The provinces are used principally for handling police,
judicial, and other regulatory functions. There are no provincial legislatures.
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The executive authority is vested in a civil governor appointed by the
president for a renewable three-year term. The governor maintains public
order, advises officials of both the national government and the cantons, and
presides at public, civic, and religious ceremonies. For all practical purposes,
though not officially, he acts as mayor of the provincial capital.
Political dynamics
Costa Rica is well known as one of the few Latin American nations that
chooses its government in free and relatively honest elections. The country
has no tradition of military intervention in the political process. Political
choice and persuasion are exerted through business and professional associa-
tions. Labor unions, the church, and student groups are not significant
political forces.
Competition in recent presidential elections has had many of the
characteristics of a two-party system. In general, every electoral contest in
recent years has pitted the National Liberation Party (PLN) against other
major parties combined temporarily against it. In the 1966 election, the
Republican Party (PR) and the National Union Party (PUN) formed a
coalition called the National Unification (UN)-the first time the major
portion of anti-PLN forces presented a united front on all levels. An
incumbent party has never been re-elected consecutively in Costa Rica.
The PLN, Costa Rica's dominant party and winner of the 1970 elec-
tions, has been a major force since it began participating in elections in 1953.
The party was founded in 1945 as the Social Democratic Party (PSD) by
Jose Figueres, a liberal who became the leader of the 1948 revolution which
was touched off when President Teodoro Picado called for the Legislative
Assembly to annul elections to void the victory of opposition coalition
candidate Otilio Ulate. The opposition forces under the command of
Figueres emerged victorious, set up the Founding Junta of the Second
Republic, and immediately recognized Ulate as president-elect. The PLN is
one of several democratic, socialist-oriented parties in Latin America that are
strongly anti-Communist in outlook. The party stresses free elections, social
reform, and the raising of educational, economic, and social standards; it
advocates a mixed economy in which the government would play an im-
portant role through the autonomous public agencies. It favors improved
trade agreements rather than increased aid from abroad.
Figueres' victory in 1970-55% of the vote-was accompanied by a
legislative majority (32 of the 57 seats) for the PLN as well. On the surface
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the party appears stronger than it has been for over a decade. If the PLN can
maintain party unity for the coming electoral campaign, it appears to have
the greatest chance ever of maintaining power for a second consecutive term.
The Republican Party (PR) has been the party most oriented to
personalities. Its leader, until his death in June 1970, was Dr. Rafael Angel
Calderon Guardia, president of Costa Rica from 1940 to 1944. In 1966 the
PR formed the major part of the UN coalition that successfully backed Jose
Joaquin Trejos for the presidency. It also comprised the bulk of the UN in
1970; in that year the UN unsuccessfully backed Mario Echandi's presi-
dential ambitions. With the disappearance of its leader, the PR split in 1971.
The majority faction formed the National Unification Party while the
minority group formed the National Republican Party (PRN), which is now
aligned with a newly formed opposition coalition. The National Unification
Party is scheduled to hold its national convention in December 1972 at
which time a presidential candidate will be selected to oppose the PLN in the
1974 elections.
Once an important element in any anti-PLN coalition, the National
Union Party (PUN), like its aging founder, Otilio Ulate Blanco, is growing
weaker. The PUN was a partner in the UN coalition in 1966, but did not
officially support Echandi in 1970. The PUN ran its own slate of legislative
candidates but elected no deputies to the assembly, an indication of the
party's extremely weak position. Thus far in the present campaign, the PUN
has opted to remain independent of any opposition coalition.
The Authentic Republic Union Party (PURA) was formed after the
1962 election by ex-president Echandi. Echandi had been at odds with Ulate
since 1953 when the latter, declaring himself completely impartial in the
political maneuvering preceding the 1953 election, refused to support
Echandi's bid for the nomination. The membership consists chiefly of
Echandi's former followers in the PUN. While Echandi lost the 1970 presi-
dential election, nearly half of the 22 deputies elected by the UN are PURA
members. Echandi is now at odds with the UN and the PURA has merged
with the Popular Union Party (PUP), presently associated with the so-called
Grand Coalition, a new opposition grouping.
The National Christian Alliance (ANC), formed in September 1972, is
made up of three parties and a third front whose leaders are dissident UN
and PLN members. The ANC is scheduled to hold an extended convention
from November 1972 to March 1973 to select candidates for the presidency
and the assembly. Its platform is similar to the National Unification Party's,
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and it may opt to support their party in order to form a united opposition
and increase its chances of defeating the PLN.
Several other small parties that participate in elections include the
Christian Democrats, a Communist-front group, and the recently formed
National Independent Party (PNI).
Security system
The Costa Rican people have demonstrated a deep aversion to
militarism and have abolished the army as a permanent institution. They also
distrust the concentration of armed power in one organization or institution,
and law enforcement responsibility is distributed among four separate
ministries of the government. The most important of the police organiza-
tions, and the only one with any military capability, is the 2,470-man
Guardia Civil under the minister of public security. Other organizations
include the 110-man Directorate of Criminal Investigation, the 80-man
Immigration Police, the 140-man Transit Police, the 300-man Customs
Police, and the Ministry of Government, Justice, and Interior Rural Assist-
ance Guard (variously reported as having 2,000-4,700 members, including
auxiliaries). Costa Rica also has a 150-man Instant Reaction Force designed
to cope with minor rebellions and riots. This fragmentation of security
forces makes coordination and cooperation difficult and hinders effective
operations.
Investigation of subversive activities is the responsibility of the National
Security Division (DSN) of the Civil Guard's Directorate of Criminal In-
vestigations (DIC) which has a total of 110 members. The DSN was estab-
lished in 1968 as a replacement for its more autonomous predecessor, the
Security Agency of Costa Rica. It has powers of arrest, search, and seizure,
but it normally does not use them; the DSN generally collects evidence of
subversive activities and then turns it over to other components of the DIC
or other government agencies for appropriate action.
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With its record of stable, democratic government, Costa Rica has
experienced less subversive activity than most other Central American coun-
tries. The population in general is not inclined to settle disputes by violence,
and the relative permissiveness of the social and political environment allows
all shades of opinion to be expressed. However, a number of mutually
related economic and social problems such as rapid population growth,
chronic unemployment, and the subsistence level of existence of most rural
workers could, if not corrected, constitute a future threat to the normal
stability of the country. In addition some political disaffection among
younger elements is becoming increasingly evident.
Communist party and leftist subversive groups
Although small, illegal, and weakened somewhat by internal personal
rivalries, the Popular Vanguard Party (PVP) is the oldest, best organized, and
best disciplined Communist party in Central America. The membership is
relatively well grounded in Marxist philosophy, and leaders of other Com-
munist parties frequently turn to PVP leaders for counsel. The PVP was very
influential in the government from 1940 to 1948. Following the 1948 civil
war the PVP was declared illegal, but it has been permitted considerable
freedom in the democratic political climate of Costa Rica.
In mid-1972 the PVP reportedly had 3,500 members-a tremendous
increase from the 800-plus reported in mid-1969-and about 10,000 sympa-
thizers. The largest concentration of members is in the capital city area, but,
unlike other Central American Communist parties, PVP members are fairly
well distributed throughout the country. The Soviet-aligned PVP has tacti-
cally eschewed violence in favor of democratic means of attaining power,
and although the youth of the party frequently evinces impatience with the
old-guard leadership no pro-Chinese faction has developed. The principal
source of funds for the PVP is the Soviet Union, and salaries for party
leaders as well as other expenses have been paid by Moscow for many years.
The Costa Rican Vanguardist Youth (JVC), known as the Costa Rican
Socialist Youth (JCS) until September 1969, is the youth wing of the PVP.
The JVC has an estimated 150 members, but these are not part of the PVP
membership. Costa Rican politicians have expressed serious concern re-
garding Communist inroads of both domestic and foreign origin among the
nation's youth. The Soviet training program at the undergraduate level is
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aimed at disaffected members of the younger generation, especially those
from campesino and lower middle class families for whom jobs and educa-
tional opportunities are limited. Since January 1960 over 300 Costa Rican
youths have studied in the USSR and Eastern European countries. This fall,
23 students were scheduled to study in European Communist countries,
including 13 slated for Patrice Lumumba University in Moscow. Other Costa
Ricans-about 50, almost all of them party members-have studied in Cuba;
44 are known to have received guerrilla training.
The PVP's principal targets have been students and labor; its greatest
success thus far has been in the labor field, especially among agricultural and
urban transport workers. Students are emerging from their traditional politi-
cal apathy and may become easier prey to PVP proselytizing in the future.
Efforts to organize women into a front group have been minimal, and the
response has been apathetic.
In 1970 the PVP used the Socialist Action Party (PASO) as its political
front for the elections. PASO offered candidates for president, vice presi-
dent, and the legislature. Candidates to the legislature received 29,133 votes
of a total valid vote of 530,425 and two deputies were elected. The PVP has
thus demonstrated a vote-getting ability well beyond its membership.
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Costa Rica has no military establishment and the country's security
forces are completely responsive and subordinate to the government. Costa
Rica's principal security force, the 2,470-man Civil Guard, performs the
functions of a national police force. The Guard is organized and equipped
for civil rather than military actions. In time of war or aggression from
neighboring countries, the bulk of the Guard would continue its police
function; a 150-man' Instant Reaction Force (IRF) has the mission of
defeating small uprisings or guerrilla movements. In a national emergency of
this scope, it is traditional for Costa Rica to rely on "minutemen"-loosely
organized groups of armed citizens.
The capabilities of the Civil Guard are limited. It can handle minor riots
and insurrections, but it could not cope with widespread outbreaks of
violence or large disturbances, counter extensive or prolonged guerrilla
operations, or resist a well-organized attack from neighboring countries. If
the country were invaded, the government would appeal to the Organization
of American States for help as it did in 1949 and again in 1955. Because of
the rapid growth of the Costa Rican population and an increase in crime, the
Civil Guard is being pressed to its maximum capability just to perform
routine police duties.
The Civil Guard also includes air and maritime sections. The Air Section
is located at Santa Maria International Airport in San Jose, and consists of
four Cessnas, four pilots, one mechanic, one secretary, and three enlisted
men assigned for general duty. The Air Section is capable of providing
limited daytime surveillance, has transported supplies and men from one part
of the country to another, and frequently engages in search and rescue
missions and medical airlift. The Coast Guard has three patrol boats, two
stationed at Puntarenas on the Pacific coast and one at Limon on the
Caribbean coast. The Coast Guard's main activity is patrolling the fishing
waters.
The budget for the Ministry of Public Security, which contains funds
for the Civil Guard, is $3.7 million for 1972, about 2% of the total budget.
Beginning in 1948 with the forces led by Jose Figueres, there has been a
tendency for Costa Ricans of different political and ideological persuasion to
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form into private militia groups. Most are, or have been, identified with a
revolutionary or political figure and draw their members from veterans of
past political struggles. They generally are loosely organized and lack
discipline. They are basically anti-Communist and often see themselves as the
only bulwark against subversion and as the guardians of the nation's
traditions. The National Liberation Party (PLN) security wing, called the
Department of Special Services (DSE), is sometimes referred to as the private
army of Jose Figueres. The basic contingency force, which numbers about
600 men, undergoes simple training in private homes. Its weapons include
M-1 and M-3 rifles and an assortment of pistols and other rifles as well as a
few mortars and machine guns cached around the country.
The Free Costa Rican Movement (MCRL), an anti-Communist organiza-
tion, is composed chiefly of about 200 Costa Rican businessmen and other
upper middle class professionals. The group has occasionally been in-
vestigated for alleged involvement in smuggling activities and the possession
of an illegal store of weapons. It has also been charged with plotting to
overthrow the government after Figueres announced the establishment of a
Soviet Embassy in San Jose in early 1972. The MCRL has neither the
resources nor the support to topple the government.
Former minister of security Frank Marshall has an appeal among the
irrational anti-Communist fringe of the population. His armed following is
estimated to be less than 20 men.
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VII. FOREIGN RELATIONS
Costa Rica's position as one of the smallest countries in Latin America
has tended to limit its role in international affairs. Its democratic principles
and practices, however, are firmly established, and consequently the country
has achieved an influential position as spokesman for democratic humani-
tarian principles in the Western Hemisphere.
Costa Rican foreign policy is governed by two principal objectives:
physical security and economic stability. Costa Rican governments have
sought to further these objectives through close cooperation with the United
States and through the attainment of status within inter-American councils.
In the latter effort, Costa Rican officials have on occasion felt the need to
demonstrate their country's independence, particularly of the United States.
This has been responsible for some seeming inconsistencies in Costa Rica's
foreign policies.
With relatively few exceptions, relations with the United States have
been markedly cordial for a century, a reflection of the Costa Ricans' general
friendship for the US. To a considerable extent their attitude is based on the
existence of mutual respect for constitutional government and democratic
traditions, on admiration for US achievements in industry and technology,
and on high regard for the US position of leadership in the free world. Other
considerations stem from the close commercial links and heavy economic
and military dependence upon the US.
During the Orlich administration (1962-66), the government
instinctively tended to support the US position on international political
issues, although important elements within the PLN sometimes seriously
disagreed with US policy. The Dominican crisis in the spring of 1965
demonstrated the willingness of the government leadership to support US
actions even when measures difficult to reconcile with PLN principles were
being taken. In spite of international pressures from sister "democratic left"
parties of the PLN in Peru, Chile, and Venezuela, Costa Rica resisted the
temptation to give less than full support to the US and was the second Latin
American country to provide a police contingent for the Inter American
Peace Force.
Despite this tradition of support for the US on political matters, Costa
Rica has at times been critical of US economic policies vis-a-vis other nations
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of the Western Hemisphere. This attitude, common to many Latin American
countries, reflects their belief that the US has not given sufficient financial
and technical aid to the American republics and that the US, as a highly
developed industrial nation, has an obligation to assure the predominantly
agricultural countries of Latin America continued high prices for their chief
export crops, of which the US is the principal consumer.
Costa Rica claims a 12-mile territorial sea, but allows innocent passage
by civilian air and sea craft. It also claims an adjacent 200-mile zone
identified as the "Patrimonial Sea" over which Costa Rica claims special
jurisdiction to protect, conserve, and exploit the natural resources.
Costa Rica signed the multilateral treaty on Free Trade and Central
American Economic Integration in 1958, but reluctantly and tardily ratified
the agreements and became a member of the CACM in 1963, concluding that
membership was the lesser evil. Among its doubts was the belief that its
peripheral southernmost location would be disadvantageous.
Costa Rica has traditionally been a haven for those persecuted for their
political beliefs. Costa Ricans also desire to preserve internal and external
peace and tend to look with disfavor upon anyone whose actions or presence
causes friction with a neighboring country. Costa Rica's relations with
Panama were strained as a result of the military coup in Panama in October
1968, following which dissident Panamanians operated from their presumed
safe haven on the Costa Rican side of the border. On several occasions,
however, Panamanian National Guardsmen entered Costa Rican territory to
apprehend dissidents. These incidents ceased in late 1969, and relations have
been normal since that time.
Traditional aloofness from the Communist nations has faded because of
the attractiveness of trade deals whereby Costa Rica can dispose profitably
of its surplus coffee. The Figueres government has moved ahead rapidly on
negotiations with Eastern European countries begun under the preceding
Trejos administration. As of mid-1972, Costa Rica had diplomatic relations
with the USSR, Czechoslovakia, Bulgaria, Yugoslavia, Hungary, Poland, and
Romania. The USSR established an embassy in January 1972; the others
maintain relations through non-resident ambassadors accredited to San Jose.
Costa Rica and the USSR resumed diplomatic relations on 24 August
1970 and had earlier signed an agreement and protocol permitting an
exchange of trade missions. The Soviet loan to Costa Rica of $9 million in
roadbuilding equipment and technical assistance, and the movement in
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general toward closer relations with the Communist nations, were subjects of
public controversy. The public media for the most part opposed the govern-
ment's policy.
President Figueres has said that Cuba definitely constitutes an ex-
ception to his open-door attitude toward the Communist bloc. He strongly
dislikes Castro and considers his detention of political prisoners particularly
repugnant. Figueres is unwilling to see Cuba return to the inter-American
community under prevailing circumstances.
Costa Rica has long been an ardent supporter of the Organization of
American States (OAS) as the best vehicle for settling international disputes
in the region. Its attachment has been strengthened by the two occasions
(1948 and 1955) when that body acted to halt invasions of Costa Rica
territory from Nicaragua.
Within the OAS, Costa Rica vigorously supported the Venezuelan
charges and case against Cuba in 1963. Costa Rica also advocated the
complete economic blockade of Cuba, and helped to originate the demand
for the political blockade of Cuba that led all the remaining Latin American
states with diplomatic missions in Havana, except Mexico, to break relations
with Cuba.
Costa Rica attaches considerable importance to the UN and to partici-
pation therein. Costa Rica is active in such fields as human rights, where it
believes it can make a useful contribution, but the necessarily small size of
its UN mission prevents its effective participation in the multiple activities of
the organization. Costa Rica's representatives have generally been of high
caliber; the chief UN post is considered the second most important in Costa
Rica's diplomatic service after the position of ambassador to the US (who is
also the representative to the OAS).
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Economic and technical assistance programs
On a per capita basis, Costa Rica has ranked next to Panama as the
largest US economic aid recipient in Central America under the Alliance for
Progress. Authorized loans and grants from the US amounted to some $181
million during 1946-71. This aid included $95 million in grants. In addition,
the Import-Export Bank approved $35 million in credits during the same
period.
The largest share of total foreign investment is held by US firms and
individuals. This share was estimated at $160 million at the end of 1970 out
of a total estimated foreign investment of $210 million. The three largest US
investors are the United Fruit Company, Standard Fruit Company, and
Firestone.
Costa Rica encourages foreign investment and accords it the same
treatment as domestic capital. Incentives are granted for some type of
investments.
The US is Costa Rica's principal trading partner, accounting for about
one third of its imports and one half of its exports. The Central American
Common Market is second in Costa Rican trade, and West Germany is third.
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IX. CHRONOLOGY AND TABULAR DATA
Chronology of Key Events
1948 (1 Mar) National Assembly nullifies elections when victory of
opposition National Union Party (PUN) candidate Otilio
Ulate becomes evident.
(12 Mar) Civil war erupts with revolutionary army led by
Jose Figueres. Government forces are defeated after six
weeks of strike, and Figueres heads "Founding Junta of the
Second Republic" (in control until Ulate's inauguration in
1949).
(Dec) Nicaraguan-supported forces of ex-president Calderon
invade Costa Rica from Nicaragua. Invasion repelled with
assistance from OAS.
1949 (8 Nov) Ulate inaugurated president; new constitution goes
into effect.
1953 (26 Jul) Figueres, candidate of the National Liberation Party
(PLN), elected president; PLN wins 30 of 45 legislative seats.
1954 (3-4 Apr) Nicaraguan exiles based in Costa Rica unsuc-
cessfully attempt to assassinate Nicaraguan President
Somoza. Somoza, convinced of Figueres' implication, vows
revenge.
1955 (Jan) Invasion of Nicaraguan-based Costa Rican exiles backed
by Somoza is halted by OAS intervention.
1958 (2 Feb) Opposition (PUN) candidate Mario Echandi wins
presidential election but legislative majority is controlled by
PLN.
1962 (4 Feb) PLN candidate Francisco Orlich elected president;
PLN wins 28 of 57 legislative seats.
1963 (18-20 Mar) President Kennedy meets with Central American
presidents in San Jose.
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(Mar) Ashfall from erupting Irazu volcano begins.
1966 (6 Feb) Jose Joaquin Trejos, candidate of coalition formed to
defeat PLN candidate Daniel Oduber, wins narrow election
victory. PLN retains legislative majority.
1968 (Jan) Government is embarrassed by contraband whisky
scandal involving high officials.
(8 Jul) President Johnson visits San Jose.
1970 (1 Feb) PLN candidate Figueres elected President; PLN wins
32 out of 57 legislative seats.
(24 Apr) University students riot to protest legislative
approval of an Alcoa contract.
1972 (Jan) Figueres government allows USSR to establish an
embassy in San Jose, the Soviets' first in Central America.
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Holidays and Significant Dates
1 January
19 March
March/April
March-November
1 May
13 June
2 August
15 August
15 September
12 October
8 December
25 December
New Year's Day
St. Joseph
Holy Week
Secondary schools in session
Labor Day
Corpus Christi
Our Lady of the Angels
Assumption
Independence Day
Columbus Day
I mmacu late Conception
Christmas
19,700 sq. mi.; 30% agricultural land (8% cropland, 22% meadows and
pasture), 60% forested, 10% waste, urban, and other
Limits of territorial waters: 12 n.m. (fishing 200 n.m.)
Population: 1,836,000; males 15-49, 395,000; 265,000 fit for military
service; average number reaching military age (18) annually about 22,000
Ethnic divisions: 98% white (including mestizo), 2% Negro
Religion: 95% Roman Catholic
Language: Spanish
Literacy: approximately 80%
Labor force: 530,000 (1970); 46.3% agriculture; 13.2% manufacturing;
11% commerce; 8% construction, transportation, and communications;
21.5% other; shortage of skilled labor
Organized labor: about 6% of labor force
Legal name: Republic of Costa Rica
Capital: San Jose
Costa Rica I X - 3
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Political subdivisions: seven provinces
Type: Unitary republic
Legal system: based on Spanish civil law system; constitution adopted
1949; judicial review of legislative acts in the Supreme Court; has not
accepted compulsory ICJ jurisdiction
Branches: President, unicameral legislature, Supreme Court elected by
legislature
Government leader: President Jose Figueres
Suffrage: universal and compulsory age 18 and over
Elections: every four years; next, February 1974
Political parties and leaders: National Liberation Party (PLN), Daniel
Oduber; National Unification Party (UN), Francisco Calderon Guardia; Na-
tional Union Party (PUN), Otilio Ulate; National Republican Party (PRN),
Longino Soto Pacheco; Popular Union Party (PUP), Mario Echandi; Christian
Democratic Party (PDC), Jorge Monge Zamora; Third Front (PFN), Virgilio
Calvo; National Independent Party (PNI), Jorge Gonzalez Marten; Socialist
Action Party (PASO), Marcial Aguiluz; Revolutionary Civic Union Party
(PUCR), Frank Marshall; Costa Rican Socialist Party (PMSC), Arnoldo Mora
Rodriguez; Popular Vanguard Party (PVP) (Communist, illegal), Manuel
Mora.
Voting strength (1970 election): National Unification (coalition of
PUN, PR, and PURA), 41.1%; PLN, 55%; PFN, 1.7%; PDC, 0.9%; PASO,
1.3%
Communists: 3,500 members, 10,000 sympathizers
Members of: CACM, IADB, IAEA, ICAO, OAS, UN
GNP: $982 million (purchasing power parity estimate, 1971), $555 per
capita, 14% government consumption, 67% private consumption, 23%
domestic investment, 6% inventory, 10% net foreign balance (1970); real
growth rate 1971, 5.5%
Agriculture: main products-bananas, coffee, sugar cane, rice, corn,
cocoa, livestock products; caloric intake, 2,610 calories per day per capita
Major industries: food processing, textiles and clothing, construction
materials, petroleum products
Electric power: 237,000 kw. capacity (1969); 965 million kw.-hr.
produced (1970); 536 kw.-hr. per capita (1970)
Exports: $231 million (f.o.b., 1971); coffee, bananas, sugar, beef,
chemical products
Imports: $348 million (c.i.f., 1971 est.); durable consumer goods,
machinery, transportation equipment, chemicals, foodstuffs
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Major trade partners: US 47%, CACM 20%, EEC 13%, Japan 9% (1970)
Direct US investment: $160 million (1971), concentrated in manufac-
turing
Aid:
Economic-extensions from US (FY1946-70), $116.7 million loans,
$91.5 million grants; from international organizations (FY1946-70), $132.7
million; from other Western countries (1960-68), $1.8 million
Military-assistance from US (FY1960-70) $1.8 million
Monetary conversion rate: 6.65 colones=US$1 (official selling rate);
8.60 (free market rate)
Fiscal year: calendar year
Railroads: 407 miles; 395 mi. 3'6" gauge, 12 mi. 3'0" gauge all single
track, 72 mi. electrified
Highways: 11,700 mi.; 85.0 mi. paved, 3,200 mi. gravel; 7,650 mi.
earth
Inland waterways: about 455 mi. perennially navigable
Pipelines: refined products, 75 mi.
Ports: 3 major, 4 minor
Civil air: 17 major transport aircraft
Airfields: 198 total, 122 usable; 10 with permanent surface runways; 8
with runways 4,000-7,999 ft.; 2 seaplane stations
Telecommunications: domestic telephone service greatly improved with
new automatic exchanges; 61,300 telephones; connection to international
Central American microwave net began in November 1971; VHF radio
system being installed; 330,000 radio and 100,000 television receivers in use;
45 AM, 9 FM, and 12 TV stations
Personnel:
Civil Guard: 2,470 (basically a police force; constitution prohibits
armed forces)
Major ground units: over half of the Civil Guard is stationed in San
Jose; remainder organized into 6 provincial capital commands; forces in San
Jose consist of radio patrol unit, military police company, and three Civil
Guard companies
Ships: 3 patrol craft
Aircraft: 4 prop (light)
Supply: dependent on imports from US
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Military budget: for fiscal year ending 31 December 1972, $3.7 million
for Ministry of Public Security, including Civil Guard; about 2% of total
budget
Diplomatic relations with Hungary, Poland, Yugoslavia, Romania,
Czechoslovakia, Bulgaria, and the USSR. All except the USSR have only
non-resident ambassadors accredited to San Jose.
National Intelligence Survey (NIS) Material
The following sections of the NIS are relevant:
NIS Area 76 (Costa Rica)
GENERAL SURVEY (August 70) and the following specialized
sections:
Sec 21 Military Geographic Regions (Nov 64)
Sec 23S Meteorological Organization and Facilities (Mar 68)
Sec 24 Topography (May 64)
Sec 25 Urban Areas (Jan 60)
Sec 36 Merchant Marine (Aug 56)
Sec 41 Population (Feb 55)
Sec 42 Characteristics of the People (Apr 58)
Sec 45 Health and Sanitation (Sep 67)
Sec 51 The Constitutional System (Feb 55)
Gazetteer (Apr 56
NIS Area 71-77 (Central America)
Sec 22 Coasts and landing beaches (Jun 69)
Sec 23 Weather and Climate (Dec 69)
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 Savannah!
?Columbia
Charleston
7766b 8-70
NORTH
AMERICA
LAND UTILIZATION
upland
0 pastre and grassland
Dense broadleaf evergreen forest
Oaeinddecciidsuous forest, savanna,
^ Scrub, with some grassland
[III Swamp-chiefly palm and mangrove
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POPULATION
Persons per square mile
0 26 65 130 518
r--r
i
0 10 25 50 200
Persons per square kilometer
Data from 1963 census,
plotted by Canton
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INDUSTRY
e Food processing
Beverages
Textiles and clothing
Lumber and wood products
Coffee processing
Tobacco processing
Q Chemicals
lI Oil refinery
AGRICULTURE
Coffee
j Bananas
i'i Field crops-chiefly corn,
sugarcane, dryland rice,
beans, and potatoes
Arenal
o LLANURAS DE
4l Carl?S I
` Boca Arenal I
Muelle San C los Puertc
Pitale ~
'La Forte a o
PU NT _ NA
GOLFO DEL
PAPAGAYO
BaIlefla
LLE DE
Liberia
Puerto"
Je5us,=
2060
San Carlos
TDrcoi
Parrit
1 ~
raiso
niinical
Isidroo
+Ir
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BAHIA DE
CORONADO
LiverpOQI
Victorian " E
Bomba
,o <
Atalan
Puer
Monza
CARIBBEAN
balito
uerto Viejo
Paso do
Cosmos
Puerto ArmuelleS
RAHIA DE
CNARCO AZUL
Almirante
La ConcePCi~fl
David
- - international boundary
_? - Provincia boundary
0* National capital
Lim6n Provlncia capital
Railroad
Spot elevations in feet
Scale 1:1,500,000
Surfaced road
Unsurfaced road
f Airfield
Principal port
J, Secondary port
 Approved For Release 2001/07/30 : CIA-RDP79-00891AO01300070001-2
Secret
Secret
Approved For Release 2001/07/30 : CIA-RDP79-00891AO01300070001-2