CHAPTER III. 

                           POLITICAL ENVIRONMENT 

 

A.  Nature of Bilateral Relationship with the United States 

 

The bilateral relationship between the United States and Costa 

Rica has traditionally been and continues to be excellent. 

Although there have been and remain some bilateral irritants, 

these have been relatively minor in an otherwise excellent 

relationship. 

 

B.  Issues Affecting Business Climate 

 

Expropriation cases (involving mostly undeveloped land), long the 

main negative factor affecting our bilateral business climate, 

appear on their way to resolution.  Five of the seven most 

prominent cases have been partially resolved and a sixth is about 

to be submitted to international arbitration by the current 

government.  However, a related problem has arisen with invasions 

of U.S. citizen-owned property by sometimes violent squatters 

that the Costa Rican police and judicial system have failed to 

deter. 

 

The case of the U.S. cellular telephone company, Millicom 

(discussed earlier), and the barriers to investment constituted 

by maintenance of state monopolies, are also issues which affect 

U.S./Costa Rican trade relations. 





 

Finally, the possible loss of Generalized System of Preferences 

(GSP) benefits because of alleged violations of international 

labor standards could have serious consequences for the Costa 

Rican export industry, particularly textiles.  A 1993 petition 

filed by the AFL-CIO and accepted by the United States Trade 

Representative, although later withdrawn, caused considerable 

bilateral friction.  A local labor confederation asked the 

AFL-CIO to file the petition again this year but no action was 

taken. 

 

C.  Synopsis of Political System 

 

Costa Rica is a democratic republic governed according to the 

Constitution of 1949.  This charter established a system of 

checks and balances among the executive, legislative and judicial 

branches.  The 1949 Constitution abolished the Costa Rican army 

and created a powerful independent body, the Supreme Electoral 

Tribunal (TSE), to oversee the impartiality and fairness of 

elections.  A 1969 constitutional amendment limits the president 

to a single four-year term in office, although amendments 

allowing re-election or the extension of the presidential term to 

five years are currently under consideration by the Legislative 

Assembly. 

 

The 57-member unicameral Legislative Assembly is elected 

concurrently with the President.  Candidates for the legislature 

run on party slates in each province and not as individuals.  The 

number of popular votes each party receives per province 

determines its quota of legislators in that jurisdiction. 

Deputies serve four-year terms and cannot be re-elected for 

successive periods.  The current legislative assembly, for the 

term 1994-1998, took office on May 1, 1994. 

 

In the February 6, 1994 election, Jose Maria Figueres, the 

candidate of the National Liberation Party (Partido Liberacion 

Nacional or PLN), was elected to a four-year term in office, 

defeating his nearest rival Miguel Angel Rodriguez of the Social 

Christian Unity Party (Partido Unidad Social Cristiano or PUSC) 

by a margin of two percentage points.  President Figueres' PLN 

party holds 28 seats in the Legislative Assembly.  The PUSC won 

25 seats.  Three smaller parties won four seats.  The next 

elections for President and the Legislative Assembly will be in 

February 1998. 

 

The two major parties are centrist with the PLN inclined to the 

moderate Social Democratic left and the PUSC tilted to the 

Christian Democratic right.  However, the policy and ideological 

differences are often blurred, and the Costa Rican emphasis on 

consensus tends to push governments to the center.  At present, 

the small minority parties hold an important balance in the 

Assembly, with neither major party enjoying a majority . 

 

The Supreme Court has 22 magistrates who sit in four chambers, 

including the Constitutional review chamber.