TRAVELING LIGHT

Costa Rica 2018 | TRANSPORT | REVIEW

Congestion has risen as Costa Rica has urbanized, and the government faces a challenge in increasing capacity while still adhering to the country's environmental principles.

Costa Rica's transport industry faces the unique challenge of expanding to meet the needs of a growing economy while at the same time reducing its carbon emissions in accordance with Costa Rica's goal of becoming the world's first carbon-neutral country by 2021. The nation has seen significant urban growth that has placed new demands on its road infrastructure, and government officials are working to develo

p robust public transportation options that will alleviate congestion, increasing efficiency and turning San José into a more navigable metropolis.

Ground was recently broken on the Orotina International Airport project, which when completed will have the capacity to handle 50 million passengers per year. Through all this, the Costa Rican government is working with international energy exports and drawing upon its previous sustainabili

ty experience to ensure this development takes place in an environmentally friendly manner. It is a complex project, but Costa Rica understands that it is a necessity, not a luxury.

ROAD

Costa Rica's road infrastructure was graded as the nation's second-largest obstacle to doing business by the World Economic Forum's 2017 Global Competitiveness Index report; the country ranked 47th overall thanks to its strong base of human capital and efficient markets, but transport infrastructure came in at just 103rd globally. Road quality was a particular weak point, coming in at 123rd overall. Data from the University of Costa Rica's National Laboratory of Materials and Structural Models estimated that 95% of paved roads in Costa Rica are either in poor condition or below the capacity needed to handle the amount of traffic they receive. The problem is particularly acute in San José, which added more than 13,500ha between 1975 and 2014 and has seen congestion skyrocket as the population has grown. Today, studies estimate that traffic in the capital alone has boosted greenhouse gas emissions by 30%, with authorities well aware that the city's ancient road infrastructure is only compounding problems.

To relieve congestion and increase traffic flow, the Costa Rican government is implementing a series of infrastructure improvements that range from technology updates to the construction of new thoroughfares. Smaller projects such as traffic-light synchronization should help increase efficiency, but officials recognize that wide-scale changes will be needed, including new transit options. The Costa Rican government passed a concessions law in 1998 to allow for private investment in public projects, but as of 2016 the program had only seen five projects use this PPP format.

Moving forward, industry leaders expect this to become a more popular method to fund the large-scale road construction the country needs. At the same time, the government is incentivizing electric vehicle purchases with new subsidies and marketing pushes. Electric cars have been exempted from import taxes since 2006; however, fewer than 1,000 green vehicles are estimated to have entered due to limited public awareness and pricing issues. The government has also begun a push to switch public buses over to more stringent European standards, though it faces inertia and distrust from the private sector. More sweeping legislation has been proposed, including a ban on the import of petrol-using cars; though still in the early stages, officials understand that dramatic changes will be needed to reach the nation's carbon neutrality goals.

AIR

Juan Santamaría International Airport has been Costa Rica's main international terminal since it opened in 1958, but the recent growth of the nation's tourism industry has pushed it to capacity. Costa Rica is in the midst of a USD100- million expansion project that will expand capacity to 6 million passengers a year by 2026, but industry leaders have recognized that this will still fall far short of anticipated long-term demand. Industry projections estimate that Costa Rica will see more than 20 million annual arrivals by 2047.
Orotina International Airport represents the future of the nation's aviation industry. Located 60km northwest of San José, the USD3.5 billion project is expected to become a Central American hub that allows the Costa Rican tourism industry to form new connections with Asian and European markets. The government is working closely with international firms to ensure that Orotina's construction goes smoothly and is up to international standards for safety and technological access; the project is overseen by British contractor Mott MacDonald. Construction is expected to begin in 2018, with the goal of completing the first phase of the terminal by 2027 and further expansions completed in phases until the project reaches its final capacity of 50 million passengers per year in 2047.