Country file

Costa Rica: little giant

The clich that Central America is one of low-income
countries and unstable governments has some truth, but
there is an exception called Costa Rica - the worlds
largest supplier of ornamental plants and foliage.
By Mauricio C. Mathias

osta Rica is a unique nation in

the Central America region, initially not that different from the
neighbouring countries, but it has
managed to achieve a good living standard for its people during 100 years of
democracy. In the ornamental plant
industry, this country of 51,000 km2 is a
major player in world trade; exports last
year reached $170.3 million. In the last
five years alone the ornamental exports
from Costa Rica grew by more than $28.5
million, well above the size of the entire
yearly plant exports from Brazil (Figure 1).
Recently, a technical mission of 26
Brazilian growers and businessmen who
were in Costa Rica for a week to see first
hand what lies behind this countrys success story. The trip was organised by the
Sebrae agency (Brazilian micro and small
business support service) and hosted by

Costa Rican
researcher and consultant Guillermo
Murillo, who has
advised tropicalplant projects in
several countries.
If Colombia is
famous for its roses
and cut flowers,
Costa Rica plant
production can be
divided into three
main segments:
green plants such as
Dracaena,
Aglaonemas and
palms (40% of the
exports); foliage with sales of leaves from
plants like Cordelyne, Aralia and ferns
(38%); and lastly, tropical flowers such as

Figure 1. Trade balance plants, flowers and foliage, 2001-2005.

Figure 2. Exports of plants, flowers

and foliage according to region,
2005.

Million US$

200
170

162

150

146
136

139

131

150

158

153

Asia Others
3% 2%

141

100

North
America
46%

50

5
2001

18

Alpinias and Heliconias (20%).

Characterised by a dynamic private sector, export-geared government policies and

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2002

2003

2004

2005

European
Union
49%

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Country file

in ornamentals

Costa Ricas plant

production can be divided
into three main segments tropical flowers, foliage
and green plants.

a helping hand from nature, Costa Rica

managed to develop a mature and diversified plant industry. According to Procomer
data, 214 companies exported plant products to 60 destinations worldwide last year
(Figure 2). Keystone to this achievement
was the ability to take advantage of historical circumstances and opportunities.

Exports since 1962

Even though other Central-American
countries had a head start at ornamental
production, the first major export project
in Costa Rica took place as early as 1962.
A company with US capital, called Mata
de Costa Rica was set up in Alajuela
province, by an American who worked in
the Miami plant industry. He started
planting Dracaena fragrans along the fence
of a coffee plantation and once he saw
how well they grew he expanded to D.
marginata, D. deremensis, D. sanderiana

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(Lucky Bamboo) and Aglaonema spp.

(Araceae fam.).
In time this project became the worlds
largest foliage production, peaking at 130
ha in the mid-seventies. In order to attract
more capital, the company went public in
the New York stock exchange in the 1980s,
which turned out to be a mistake. Its competitors bought the companys shares and
sold them at a lower price, eventually
leading to the companys bankruptcy. To
complicate things further, employees had
been multiplying the companys plant
material, subsequently selling it to others
or starting their own production. These
actions shaped the character of the early
periods of Costa Ricas plant industry, that
of several small companies and many of
them with the same product.
Some historical perspective is necessary,
however, to understand the circumstances

Help from Mother Nature

Costa Rica, situated near the equator and
having plenty of sunshine, has a diversity
of micro-climates, as one drives along its
well-paved roads, different landscapes
appear. The Atlantic coast is very warm
and rainy, the Pacific side is also hot, but
drier, in between is a central plateau,
where most of the population lives. The
temperature in the capital, San Jos, at an
altitude of 1,150 m , is between 15 and
o
25 C. The countries highest peak is the
Chirripo at 3,820 m. The strategic location
has been another factor: access to two
oceans, without having to cross the
Panama Canal, has helped shipping
foliage containers, while with air transport
Miami is only a couple of hours away.

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Country file

Skilled labour is a competitive advantage; workers have been with their companies for years and know their jobs well.

invest in the Costa Rican economy in

order to prevent the regional problems
from spreading to the country.
To that purpose, the United States
Agency for International Development
(USAID) granted non-refundable loans
that were used, among other things, to set
up the Costa Rican Investment Board
(CINDE), a private non-profit organisation, founded in 1982. With a
board of directors made up of
Table 1. Flower exports, 2005.
major local businessmen, its
objective was to diversify the
economy with exportable
Product
Total ($)
Weight (kg)
goods and to attract foreign
Statice
816
578
investment. To implement it in
Gladiole
1,775
767
the mostly banana-and-coffee
Gypsophila
2,677
2,218
agriculture of the time, agroAlstromeria
7,382
3,321
nomic research had to look for
Carnation
3,392
13,368
non-conventional crops with
Agapanthus
6,270
19,696
export potential.
Others
140,902
85,276
Twenty new crop proOrchid
401,968
30,548
grammes were selected; ornaGerbera
446,811
115,822
mental plants being only one
Anthurium
575,823
135,064
of them. The next step was to
Pompon Chrysanthemum 607,575
199,048
bring in foreign experts as
Strelitzia
653,747
298,875
advisors, who under the loan
Calas
807,747
201,292
terms had to be preferentially
Rose
909,800
244,439
Americans. It soon became
Heliconia
987,320
535,872
clear that scientific knowledge
Ginger
1,869,331
1,528,410
about tropical production of
Bouquets
2,098,102
1,051,853
ornamentals was scarce, espeAster/Dragon/Tipsophita 2,298,081
694,343
cially under the local condiChrysanthemum
3,101,616
1,176,588
tions. So a reverse decision was
Others
5,050,402
1,803,645
taken; to send local personnel
Lirium
14,633,217
2,771,005
overseas (using US air compaTotal
34,676,755
10,912,027
nies) for training courses and
Source: Acoflor
trade shows, while others travin which the Costa Rican plant sector
developed. Back in the 1960s most of
Latin American countries had serious
political problems, with either left-wing
movements or right-wing dictatorships. In
the 70s there was civil war in Nicaragua,
Honduras and El Salvador. The American
presence in the region was strong when, in
1978, the US government decided to

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FlowerTECH 2006, vol. 9/no. 3

elled to Jamaica and Guatemala to learn

from their previous experiences.
The real watershed moment in the sector
however, was the decision to open offices
in Costa Ricas main destination markets
as CINDE set up bureaus in Miami, NY,
Canada, the Netherlands and Japan. In an
innovative move for that time, these
offices mission was to supply growers in
Costa Rica with market information,
trends and any relevant news that would
help fine-tune production at home. The
foresight of the concept, that of marketdriven production, became evident as
exports grew steadily using the feedback
on customer satisfaction to solve any
eventual problems. At home lower interest
rates for agricultural projects were an
incentive for diversification.
In 1979 the government spurred exports
with actions such as a cash rebate program
(known as CAT) that ranged from 8 to
20% of the amount exported; tax exemptions for rural vehicles, as well as for production supplies at exporting farms. The
latter is the only one that has remained
until today. CATs were discontinued in
1999 as a parallel market had developed
trading these certificates, plus the government was paying back considerable
amounts of money to large export firms.
Their discontinuation was a blow to the
market, and those that had become inefficient relying on the extra incentive didnt
survive, still others had to downsize. The
success of the overall plan was clear
though, working both ends of the chain
brought remarkable growth for the indus-

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Country file

try in the 1980s.

By 1987 a pact to halt further expansion
came into effect for two years, to focus on
quality. Mandatory cost-accounting as well
as a foliar-analyses and fertilisation programs were started and courses were set
on farm-auditing. At the time 120 farms
were receiving free consultancy but many
didnt apply it in practice, so when it
became a paid service only 30 chose to
continue it.

Tropical flowers
The flowers and flower buds segment represented only 20% of all ornamentals
exported by Costa Rica in 2005, or $34.7
million. The USA is by far the main buyer
when it comes to flowers, purchasing $31.4
million, Europe only $1.6 million followed by Canada, with almost $1 million.
Among them tropical flowers (orchids,
anthurium, strelitzia, heliconias and ginger) represent a significant percentage,
according to data from Acoflor, the Costa
Rican association of flower growers (Table 1).
It is estimated that about 550 ha of tropical flowers are cultivated in Costa Rica in
extensive farms such as Plantas La Bonita,

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a producer and exporter in the Atlantic

zone. The majority of such flowers are
grown in this lowland on the Atlantic side,
where land is cheap and no irrigation is
needed due to the moist alisio winds
coming from the ocean guaranteeing 4,000
mm of rainfall yearly. So in spite of the
regions deep, sandy soils, drainage ditches
are needed between the shrubs and bushes
of a wide assortment of Alpinias, Heliconias
(many H. psitacorum), Zingiber, Etlingera,
Costus, Musa and Curcuma.
On average these crops demand 1.5 worker per ha and the pay rate in Costa Rica is
around $1.10 per hour, in a 48-hour work
week. The impact on the local economy
and society of areas where the cultivation
of tropical flowers was established (also in
the Central Valley and North zones) can
not be overestimated. Since its introduction, a growing number of women have
been employed to work, especially in the
pack houses, and sometimes in the field.
Having both the man and the woman of a
household employed doubles the family
income; plus, women tend to save a higher
percentage of their earnings.
Skilled labour is one of the competitive

advantages of Costa Rica, now with

decades of ornamental tradition; workers
have been with their companies for years
and know their jobs well. This becomes
evident at La Bonitas pack-house, with a
predominantly feminine staff, work progresses smoothly as the plants arrive from
the field. Flowers are checked, washed and
sorted out; stems are cut to the same
length, and the many steps necessary to
prepare a bouquet or a box of flowers are
carefully taken care of, without any apparent supervision.
Moreover, although there are greenhouses in Costa Rica, most of the plant production takes place under shade houses,
or in open fields. While older fields are
replanted with more productive and
trendier varieties, Costa Rican farms rely
on updated agronomic practices to
increase yield and quality, rather than
high-tech solutions.
More about the other ornamental sectors in Costa Rica,
like green plants and foliage, will be published in our July
issue of Flower Tech.

mauriciomathias@hotmail.com

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