From San José. Chinchilla Embarks on a U.S. Charm Offensive

May 13, 2011

Costa Rican President Laura Chinchilla will visit the United States next week in a bid to build on the charm offensive with American investors and media that she kicked off last September.

Chinchilla and a selection of top cabinet members and investment promoters will set off May 14 for San Francisco, California, and then to Washington DC on May 18, meeting along the way with businesses to spark interest in moving their operations to Costa Rica.

“I want to get the message in the minds of investors worldwide that Costa Rica is the best destination for their operations,” Chinchilla said on Tuesday.

Chinchilla needs to convince U.S. companies that Costa Rica, known for its stability, is still a sound investment despite the country’s infrastructure shortcomings, crime problems and her government’s widening deficit that surpassed 5 percent of GDP last year—the highest as a share of economic output in Latin America, according to the Economic Commission for Latin America and the Caribbean (ECLAC).

Upon taking office a year ago, Chinchilla hinged her plans for economic growth largely on attracting foreign direct investment (FDI), which is considered a big driver for developing markets like Costa Rica.

On that note, her FDI report card has earned top grades. The Chinchilla administration set a goal of $1.3 billion in FDI inflows for 2010 and beat that mark by 12 percent, touching $1.45 billion last year, according to Foreign Trade Minister Anabel González. The government is shooting for $1.95 billion this year and up to $9 billion total for the duration of Chinchilla’s presidency ending in 2014.

Chinchilla also introduced measures to cut through red tape for setting up business here, and, just this week, announced a range of new visas specially for foreign investors.

In addition to scheduled meetings with private firms and media, her U.S. tour includes a visit to the Lawrence Berkeley National Laboratory in California to study possible clean energy projects. The motivation here is the president’s aims to wean Costa Rica off an ever-costly oil dependency.

Chinchilla will also stop by the American Enterprise Institute and the Brookings Institution. The latter is the workplace of foreign policy expert Kevin Casas-Zamora, who like Chinchilla, also once served as vice president under Costa Rica’s former leader, Óscar Arias.

Before heading back to Costa Rica on May 21, Chinchilla may see a few more familiar faces, or at least a familiar landscape. Chinchilla is due, on May 20, to deliver a speech at the commencement ceremony of Georgetown University, her alma mater, where she was known to engage in heated debates with the late Reagan adviser Jean Kirkpatrick.

The 52-year-old leader surely can use a trip away, particularly to Costa Rica’s good friend, the United States. Rounding off a difficult first year this month as Costa Rica’s first female president, Chinchilla has suffered considerable setbacks that may weaken her administration. These include a recent power-grab by minority parties in Congress who fiercely oppose key pieces of her reforms agenda.

For the president, a strong dose of FDI growth couldn’t come at a better time.

*Alex Leff is a contributing blogger to AmericasQuarterly.org based in San José, Costa Rica, and is a local correspondent for Reuters and GlobalPost.