The fourth in a series of articles comparing Central America’s two leading expat and retiree destinations.  Costa Rica is the more established of the two, but Panama is the upstart new kid on the block with a full head of steam and a pocket full of dollars.  Who will come out on top? Read more and find out.

Click here for Round 1: Retirement Benefits

Click here for Round 2: Climate

Click here for Round 3: People and Culture

Round 4: Things to do

If you are going to pack up (or sell) everything and move to Central America, you might as well go somewhere where there is stuff to do; after all, you can only sit on the porch and drink so many margaritas before it becomes mundane (or does it…).  In this matchup, the cultural and outdoor activities of each country are looked at and a winner decided.  Round four, begin!

Note: While sitting on the beach all day is fun, it can be done in both countries with equal laziness. Thus, beachbumming does not count as an activity.

Costa Rica

Expats, retirees, and tourists wouldn’t have been flocking to CR for two decades if all there was to do was sit on the beach all day.  For a tiny country, Costa Rica boasts a huge array of attractions that can keep the average gringo busy for months, if not years.  Here are a few top picks, both in outdoor activities and cultural discoveries.

Into the wild:

1. Arenal volcano- Yeah, its been exploited more than Macauley Caulkin, but Arenal still is one of Costa Rica’s most impressive, and easily accessible, natural attraction.  Not only does lava commonly spurt from the top, but the surrounding area is popular for hiking, fishing, and canopy tours.

2. White water rafting- This is some intense stuff. The #1 river to raft is the Pacuare River, which not only offers a rush of adrenaline but also a chance to see virgin rainforest up close, without the mosquito bites.

3. Parque Corcovado.  It would be a sin to leave out Corcovado from any list.  This is the absolute best place in Central America to immerse oneself in the rainforest without going “Man vs Wild” Bear Grylls-style.  Far enough from the tourist trail but still within civilization, the park offers unparalleled access to plants and animals in their natural habitat.  And the hiking isn’t all that difficult.

Whats a Tico, anyway?

1. San Jose museums and opera house- not many travellers or expats spend much time in the capital, but the gold and jade museums, along with the Belgian/Italian designed opera house, are worth checking out to get some background on Costa Rica’s long history.

2. Grana de oro- Coffee is big time in CR, and even non-fans of the stuff (like me) will find the coffee regions intrguing.  The process, the climate, the scenery, plus the opportunity to taste and buy some of the “gold grain”

3. Craft shopping- Even the guys out there will enjoy this, as every manpad (or dining room…) should have at least one piece of badass foreign art that you can tell your friends about.  Despite not having a gloried pre-Colombian past, the country boasts some excellent handmade crafts, from pottery and dolls to colorful oxcarts, that are available for a fraction of what you would pay for them in North America.

While it can sometimes feel like you are being led around by the hand by tour guides and its often hard to go five minutes without seeing a fellow gringo, Costa Rica has a ton of activitis to offer, too many to list here.  The infrastructure is top notch, making even the novice traveler or expat feel comfortable.

Panama

In a country that is still being discovered by gringos, Panama has some really cool stuff for the expat, retiree, and tourist alike.

Into the wild:

1. Wildlife viewing- Rainforests and cloudforests dominate Panama, so there is no lack of opportunity to get out and see some nature.  The famed Pipeline Road is close to the capital in the Soberania Park and is great for birdwatching, and the Baru National Park in Chiriqui is well known for its Quetzal birds.

2. Tree canopy adventures- scattered in forests throughout the country, these “rides” consist of a person being harnessed and attached to a zipline, then literally flying around the forest canopy from one platform to another.  Really cool, safe, and a total adrenaline rush.

3. Diving and snokeling- Get off the beach and into the water.  Around Portobello, Isla Grande has well-established dive programs and Bocas del Toro offers some untouched diving spots.

The canal and more

1. Panama Canal- Every tourist, expat, and retiree should see the canal in action at least once.  Not only is it really a remarkable feat of engineering, but also a big part of each Panamanian; a true source of pride.  If possible, book a trip from the Pacific to the Caribbean or vice-versa.

2. Portobello- Steeped in history, this Caribbean town was once one of the most important cities in the Western hemisphere.  Some of the most famous pirates fought brutal campaigns in and around the town, and the ruins are quite amazing and the tourist infrastrure well set up.

3. Go native- Panama boasts some pretty unique and accessible indigenous tribes, each one being different in some way, beit customs or language.  The Embera people mainly inhabit the dangerous Darien forest along the border with Colombia, but a few communities have made their way to the Chagres River by the canal area and welcome visitors daily.  Along the Caribbean coast, the Kuna people make their home among the 400 islands of San Blas, so visitors are treated to an incredible setting as well as indigenous customs.

Round 4 winner: Costa Rica. This was a close one, but Costa Rica’s far superior infrasture gives it the edge.  While this might not appeal to everyone, CR is just more accessable than Panama; however, given the right oversight Panama could easily equal, or even surpass, Costa Rica in terms of cool things to do. And man, Corcovado just plain rocks. Score: Costa Rica: 2, Panama: 1, 1 tie

Voice your opinion below.  Agree, disagree, or have additional info thats been left out?  We want to hear from you…

Costa Rica is a very small country, but yet still represents 5% of the bio diversity of the planet. Places like Corcorvado park is a haven for back packers, jet setters and those looking for eco-adventure. Being conscious about your carbon footprint is crucial to the success of sustainable tourism. The local community needs to be encouraged to take care of the environment and preserve nature.

By Patrick Connelly

In the United States, timekeeping and punctuality are extremely important. In Costa Rica, on time is thirty minutes late.

This single cultural difference is the cause of incalculable headaches, marital verbal jousts (usually in public), and the occasional complete gringo psychological meltdown. For the uninitiated, the manner in which life progresses in Costa Rica can be a quite a shock. Life is slower, catered to be savored.

Costa Rica is unique in that its culture has been carved and crafted by so many different nationalities. Geography is the culprit here. The country lies in a peculiar spot on the Central American isthmus that allows for cultural invasions to occur freely; most notably, because it lacks a major indigenous population. A whopping ninety-four percent of Ticos classify themselves as white or mestizo, while less than four percent are Afro-Caribbean or indigenous. Consequently, Costa Rica is an anomaly on the isthmus in that there is not the prevalent indigenous culture or the indigenous versus white dynamic as seen in Guatemala or Belize, nor the visible social ills that often accompany it.

To make up for the lack of indigenous civilizations, Costa Rica became a land of immigrants, much like the United States. Perhaps this is why people from the U.S. find the country so appealing; indeed, the idea of the American dream is alive and well here. Europeans and Chinese immigrants arrived en mass at the turn of the twentieth century, bringing with them their respective cultures; more recently, North Americans have added to the cultural dynamic. As far as Latin American countries go, it is a real melting pot.

Which is not to say that San Jose is like Rome or New York. This is, after all, a Latin American country, and with it comes the standard-bearers of Latin cultures. For instance, driving. The first time a highway built for two lanes becomes a makeshift four lane monster – with motorbikes weaving between cars and trucks – one realizes they are definitely not in Kansas anymore. As in much of the Latin world, the siesta has gone the way of the dodo, replaced by the need to improve the bottom line; however, in the more rural and mestizo parts of the country a post-lunch nap is still enjoyed. As with the first point on punctuality, make a mental note: businesses – sometimes all businesses in a town – may be closed for a few hours in the afternoon. Find a nice hammock, a good book, and relax.

While the Central American staple of beans and rice – comida típica ­- is ubiquitous throughout the country, Costa Rican food is as diverse as its people. As a result of the large immigrant population, tourism, and the McWorld which we now live in, everything from fast food to filet mignon can be found quite readily, even in remote locales. One will definitely not go hungry in Costa Rica, nor will one end up eating fried ants and monkey stew.

Like people from the U.S., Ticos have forged their own culture and identity from their unique geographic position and diverse racial makeup. They are incredibly proud of their country’s achievements, particularly the fact that Costa Rica has not collapsed into civil war or ethnic slaughter like so many of its neighbors. “More teachers than soldiers” is a popular claim to fame. A certain mean between the extremes is the goal of most Ticos; in other words, proud but humble.

While they may be humble, machismo still exists among Costa Ricans, albeit not to the extent of other Latin countries. In the Meseta Central and along the coasts machismo has been replaced with modern day liberalism, and the old vestiges seemingly only exists within the taxi and bus driver community. However, in more rural areas with large mestizo populations women may occasionally receive inappropriate catcalls (dubbed piropos); ninety-nine times out of a hundred these are innocent, merely males asserting their masculinity to their nearby amigos. Ignoring the calls and whistles usually does the trick.

Back to the first point. We estadounidenses often forget that our culture is one of the most work-driven and fast moving in the world. Not always being punctual does not mean that Ticos are lazy or inefficient; in fact, they are very industrious…when its deemed necessary. A business meeting at five thirty starts at five thirty; similarly, a bank will open its doors promptly at the same time every morning. To exemplify the achievements of their country, Costa Ricans will go out of their way to make foreigners feel at ease, trying their best to impress. Additionally, altitude defines attitude. In the urban mountain ranges things are generally a bit more punctual, a bit more scheduled, a bit more…U.S.. Along the coasts and in the rainforests life moves slower; manaña is said to be the national answer to everything. But this is part of Costa Rica’s charm, the ability to live life at the perfect pace. It is truly pura vida.

Picture provided by barnabywasson on flickr

1. Legal guidance – Buyers should use a real estate company or their own attorney to guide them through the legal process. Costa Rica’s legal system varies from most countries. Buyers must contract a trusted attorney to do the due diligence necessary. Make sure there is no impending tax burdens on the property, zoning, among other things that could affect title or future construction.

2. Get familiar with Costa Rica – Don’t get swallowed up by the beauty. Often times tourists fall in love with the incredible scenery and charming people, but forget that real life is not a permanent vacation. Don’t forget about bills, work, cultural differences. It is a good idea to live in an area before you make a purchase, even if it is for a couple weeks or a month.

3. Research the area thoroughly – Think about your needs. Do you want modern conveniences like Internet, cable TV and air conditioning? Or would you prefer to live in the middle of rain forest with wild animals looking in your window? Costa Rica has a wide variety of climates, from the more dry “pampas” of Guanacaste to the alpine forests of Heredia. Don’t forget about the tropical Caribbean coast. Once you decide the type of climate you like make sure you can find a place that has what’s important to you. Do you like to surf or shop in large malls? Is there a grocery store nearby? What about a bank? If you are looking to go into full immersion, maybe living in a place with very few foreigners is a good idea?

4. Compare and contrast – Once you’ve seen numerous properties, make a check list of the pros and cons of each one. Carefully consider all factors like the quality of the construction and surrounding neighborhoods.Make a list of must have things and other things that you desire, but can live without.

5. Once you’ve made a purchase, get involved with the culture – One of the most important aspects of living in another country is immersing yourself in the culture. Costa Ricans are generally very welcoming and like to teach others about their local culture and expressions. Spend time learning Spanish. It will help you a great deal. Live like a Tico!

Click on the link to view thousands of properties in Costa Rica

Ok, I’m glad I got your attention. I had the pleasure of chatting with Ben Vaughn, real estate professional and author of Guys in the Zone, a very insightful Costa Rica real estate blog.

This was a really fun interview. The sound quality is not the best, but I enjoyed speaking with him. We covered a lot…from the most common misconceptions people have about buying Costa Rica real estate to how the real estate market there is being affected by the economic slow down around the world. Listen to the interview and find out why you should be yodeling naked on the pacific coast of Costa Rica! (the answer is about 5 minutes in)

picture provided by jeepeenyc on on flickr    http://www.flickr.com/photos/jeepeenyc/974730475/

By Carol Stanley

Contributing writer to Latinworld.com

Writing about places like Costa Rica, Brazil, Mexico and Panama puts me in a day dreaming zone. I can actually feel the warm ocean breezes and see the clear blue sky. I feel my entire body just calm down and enjoy the feeling of having no place to go. However, I live on the Oregon coast and rain, wind and cold are my daily companions.

We know that we are living in a rather precarious financial time now. Escaping to a quiet, beautiful, and inexpensive place sounds good to many of us. It is time to retire, and the dollars are dwindling on a daily basis is not a good combination. Where can we retire on limited funds?

The big question here is “what are you looking for”? If you are a big city person, needing to be on the go all the time you may have to give some careful consideration before moving to Latin countries. However, there are many residential projects in San Jose, Costa Rica with clubhouses full of activities and parties. We know when in Costa Rica it is time to party. Can you leave your friends, ever changing technology, fast food restaurants and melt into a peaceful serene tropical life?

When making a decision about leaving the U.S. be prepared to make many life changes. The availability of all the things you are used to may not exist. You will have a totally different daily agenda and it may take some getting used to. Running to big cities for fancy restaurants and fabulous shopping may not be at your finger tips.

Let’s talk budget. Yes it is true you can live a lot cheaper in Costa Rica than in the states. Some of the latest figures reveal a couple can live for between $1200 and$1500 per month in a modest but very comfortable dwelling. This estimate can escalate for more luxurious living if your budget allows. Utilities are about 30% less money, and hopping on a local bus would cost around fifty cents. Heating one’s home is practically non existent with the temperate climate. Gas for cars is considerably less than in the states. One huge benefit in Costa Rica is that you can have your house cleaned, garden tended to for few dollars. Salaries in general are quite a bit lower than the United States. Health care costs are minimal, and that alone can be a huge drawing card for economy minded people. The banks pay extremely high percentages on your money.

Food, a very important factor in our lives is abundant. You can purchase local produce, enjoy small cafes for sociability and good food at low prices. The Costa Ricans are friendly, welcoming and helpful. Another big benefit is that they have a very low crime rate.

San Jose real estate costs have risen over the past years due to continued popularity. However, during this time of global crisis, many good bargains can be found.

Summing up …Life can be fun, inexpensive and promote a healthy life style. It is up to you how you want to spend your retirement days. You will make many new friends, as Americans alone are moving there in large numbers, and all looking to get acquainted. Before making a decision about where you plan to spend your retirement years, make a trip there, rent a place for at least a month, and talk to people. Find out how you would fit into this tropical paradise.

Featured Blog Contributor:
Carol Stanley is a well known speaker and author. She writes frequently on baby boomer and retirement topics. Her latest book, For Kids 59.99 & Over can be found at all online bookstores. www.babyboomerpower.com, www.boomercarol.com

By Patrick Connelly

The Costa Rican government recently proposed several new measures in regards to immigration that could severely change the retiree and expat situation. Their aim, in theory, is to dually combat the large influx of mainly Nicaraguan migrant workers as well as the increasing stream of North American moving to the country. With the proposed increase in monetary qualifications for both prospective rentistas and pensioners, many would-be North American expats may be turned off by such a move, particularly in the current financial environment.

The Costa Rican immigration authority, Migracíon, has recently been quoted as saying that the immigration situation in the country is “out of control” and that stricter requirements are desperately needed. In response, the government has proposed to increase immigration requirements for pensioners from $600 a month to $2000 a month, while rentistas face an increase from $1000/month to $5000/month. Basically, to qualify for Costa Rican residency you will have be able to prove that your pension or monthly income equals or exceeds the amount for whichever category you fall into, rentista or pensioner.

In light of these astronomical increases, it is clearly evident that potential retirees and expats could get hosed on this one. According to the U.S. Social Security Administration, the average pensioner in the U.S. receives around $1100 a month, far below the prescribed requirement. And, as the U.S. has one of the highest pension averages in the world, these requirements would have a worldwide effect; for example, Canada – a major contributor to the Costa Rican expat and retiree scene – has an average of around $700 a month.

The government in San Jose continues to claim that these requirements are “easily attainable”, which, from their point of view, is understandable. Milk the cow. If a steady cash flow continues to arrive via North America, it is not surprising that a government would try to keep pressing to see what the ceiling is; that is merely good business. However, in this case it would appear as if the proposed requirements far and away exceed any rationality.

And therein lies the silver lining in this possible four car pileup of increased immigration requirements. This is not an isolated incident; in fact, as recently as 2004 a similar bill was introduced. Met with immediate uproar from the expat community, it failed to pass into law. Recently, when informed that the average U.S. pensioner receives $900 less than the desired requirement, a Costa Rican assembly member was unaware of these figures. Now, this could be a simple mistake on part of the Costa Rican government or an attempt to slide one past the North American community; either way, it poses potentially serious problems for would-be expats in Costa Rica. However, the government recognizes the importance of the expat and retiree communities and the income it brings in, and will certainly proceed with caution as to not disrupt such a vital part of the economy. Certainly a situation worth monitoring in the coming months.

Click on the link to read more analysis on how expats are affected by Costa Rican immigration laws

Have additional input or information on this topic? Feel free to contribute on our board below

We had the pleasure of speaking with Rick Valentine, President of Latitude Destination Properties. In this short interview he tells us a little bit more about his latest project, Tranquilo Costa Rica and gives us his perspective on the Costa Rica real estate market.

LW:Start off by telling us a little bit more about Tranquilo Costa Rica

Tranquilo is a collection of quarter ownership condos tucked into a ridgeline where the rainforest meets the Pacific Ocean on the Central Coast of Costa Rica. Designed to instill a restorative sense of well-being in the lives of every resident, Tranquilo is an alternative lifestyle proposition; a place to restore, reset, and remember the important things in life. It is a home families can call their own and return to, again and again, for generations to come.

LW: What are quarter ownership residences and how do they work?

Tranquilo is reinventing real estate ownership in Costa Rica with its quarter ownership opportunity. Owners will have the flexibility to use their residence in whatever way works best for them. Owners can place their condos in the rental management program or can trade with other properties around the world via Tranquilo’s membership in a Global Exchange Network.

Each quarter ownership is a deeded interest in one of Tranquilo’s unparalleled residences. Owning a home at Tranquilo is completely flexible, yet 100 percent exclusive. Completely affordable, yet luxuriously designed. Completely unique, yet linked to a larger community of individuals, all inspired by holistic and authentic living at its finest—exactly as nature intended.

LW: What makes your project eco-friendly?

The condominium architecture at Tranquilo is designed to complement the natural landscape, never overpower it, to fit seamlessly into the rainforest and to peek over the canopy towards the Pacific Ocean. With 90% of Tranquilo undeveloped, its footprint has been minimized in every way possible. At Tranquilo, you live in your view, you don’t look at it. Each building is meant to function as a living, breathing organism with a series of systems (mechanical, structural, plumbing, electrical) and biological systems (building integrated vegetation, site landscaping, recycling water systems) that interact with the environment in a beneficial cycle. Large operable window facades, controllable sun louvers, and vegetated walls are main components of the building skin and are essential to allow cross ventilation, provide fresh air, and create a connection between inside and outside. Exterior gardens, green walls, and vertical planters on each terrace moderate the warm climate, purify air, provide shade, cool the building naturally, and attract wildlife and fauna to the site. Green Living walls that grow on both sides of each building cool the structures naturally, and reduce the need for air conditioning.

LW:Where is the project located on the Pacific coast? How do you get there from San Jose (plane, driving)? How long does it take?

Tranquilo is located in the private resort community of Punta Leona. Largely unknown to tourists, Punta Leona is a hot spot among locals and tranquilo-costa-rica-real-estate2those in the know, making it the area’s premier gated community. Situated on the gorgeous Central Pacific Coast, Punta Leona is just a 90 minute drive from San Jose. With the completion of the super highway in 2010, this commute will be shortened to a mere 45 minutes. Its dazzling array of rugged topography, including AAA and Blue Flag rated beaches and a tranquil butterfly farm, sets it apart from the rest of Costa Rica. At once distinctive and enigmatic, it is also incredibly private: a unique enclave from the rest of the world. Home to the 750-acre Punta Leona Refuge, Costa Rica’s largest private nature reserve, Punta Leona is a veritable wonderland for plant life and endangered wildlife, like the Scarlet Macaw, the White-nosed Coatimundis, and Spider Monkeys, among countless others. Dotted with walking and hiking forest trails to one side and large swaths of pristine white sand beaches to the other, Punta Leona delivers the best of both worlds, and is nothing short of being a true tropical paradise.

LW: Why the Pacific coast of Costa Rica?

Punta Leona was chosen as the home for Tranquilo because of its close proximity to San Jose and the truly unbelievable site upon with the project is being built. Constructed where the mountains meet the sea, the elevations provide dramatic views of the rainforest and ocean. Furthermore, the price of real estate on the central coast remains a fraction of the cost of Guanacaste real estate while providing a far superior landscape. Furthermore, Punta Leona is home to Playa Blanca, the highest rated beach in the country and only beach to win both the Blue Flag and AAA rating for cleanliness and environmental conservation. In addition to Playa Blanca, a white sand beach, Punta Leona hosts two other incredible beaches as well.

LW: Who does the project target (retirees, investors, expats, etc)?

The project targets second homeowners who want flexibility in ownership, a hassle-free vacation experience, and who prefer to match their purchase price with their actual usage. With studies showing the average second home is occupied on average only two weeks per year, we didn’t feel like whole ownership made much sense. Quarter ownership provides Tranquilo owners the flexibility to stay weeks at a time or just a weekend here and there. Furthermore, when not in residence, they have the option of placing the condo in the rental program or participating in our global exchange network. This network provides access to luxury homes around the world effectively multiplying ownership at Tranquilo into an unbelievable lifestyle proposition.

LW: How is Costa Rica real estate being affected by the economic problems worldwide?

As a whole, the Costa Rican market has slowed compared with the last few years. However, real estate priced below $300,000 has not experienced the same slow down. While for most projects, this means one-bedroom units, and small two-bedrooms that are perhaps off the water, at Tranquilo this would include fully furnished studios from below $70,000 up to 2200sqft, three-bedroom residences. It is for this reason that Tranquilo is being viewed as an “intelligent ownership” option. In a world where consumers have never been more price sensitive, Tranquilo has maximized the value-to-cost ratio.

LW: How do you see real estate in Costa Rica (specifically the Pacific coast) 10 years from now?

Most experts agree that Costa Rica is well positioned to boom in the coming years when the U.S. and global economy begin to recover. From its stable government and economy, and easy access from numerous major U.S. cities, to its tropical climate that many compare to Hawaii, one struggles to find a better alternative for a warm weather second home. The people and culture of Costa Rica are warm and inviting, health care is world class, and the cost of living is only a fraction of the cost most North Americans face. The baby boomers will lead the trend, but North Americans as a whole are going to be looking for affordable alternatives that provide the quality experience they expect with the flexibility they desire as the movement towards families reconnecting continues. We envision Tranquilo as the meeting place of multiple generations where there is something for everyone and where going on vacation isn’t about getting away…it’s about coming home.

Trick question! From what we have seen real estate licenses don’t exist in Costa Rica. NO studying, NO test and NO experience required to sell real estate in Costa Rica. That means that pretty much any average Jose can sell property. There is no recognized, official entity that monitors or certifies real estate agents/brokers like in the United States. This means that prospective buyers should do some due diligence on the agent before working with them. It is good practice to get several references to confirm a positive track record. Obviously working with an experienced agent will help avoid potential pitfalls.

Finding the right property to purchase can be a challenge in Costa Rica since there is no central database or MLS (multiple listing service) with all the properties. This means that most buyers need to surf multiple sites in order to find a more accurate inventory of listings in a specific region. Sharing inventory seems to be more common than before, but there is still a lot of room for improvement.

Another important difference in Costa Rica is that most real estate listings are not exclusive to one agent/company. This means that if you are selling a property you can list it with 10 different companies. The first company to sell the property receives the commission. As real estate blogger and Costa Rica expert Ben Vaughn puts it, “There is no listing agent, nor sellers agent.” This is pretty common throughout Latin America. With the proliferation of large franchise brands this seems like it could be changing, but in no way is it the norm.

By Patrick Connelly

Recently, legislation proposed by the Costa Rican government to dramatically increase the income requirements to become a CR resident have caused quite a stir within the expat and retiree population, and rightfully so. This is no miniscule rise by a few percentage points to boost the bottom line; these increases, including a five hundred percent increase in rentista income requirements, are not only unfeasible but also send out the wrong message. Has Costa Rica, the longtime destination for North American retirees and expats, hit the crest of the wave and no longer wants its gringo neighbors to keep moving southward?

Of course not. It is unrealistic that the government would – or could – sacrifice such a vital stream of revenue. For better or worse, the Costa Rican economy is largely based on the influx of outside dollars; to suddenly pass regulations that significantly inhibit this flow of money would be economic suicide. But that is what these new regulations would seemingly do. Pensioner requirements for residency are slated to increase from six hundred dollars to two thousand, or a mere nine hundred dollars more than the average U.S. pension. Those falling into the rentista category face similar changes, with requirements increasing from one thousand dollars a month to five thousand.

So what has caused this sudden shift in immigration policy? The government in San Jose says that the main reason is national security; with an ever increasing population of Nicaraguan migrant workers, Costa Rica is desperate to get the immigration situation under control before significant social problems arise. Which is a completely understandable goal, given the increased attention both Costa Rica and the U.S. have given to the drug trade on the coasts.

But if security is really the issue here, the government seems to be targeting the wrong crowd, and at the same time sending a negative message to established expats and retirees. If foreigners who cannot meet the proposed requirements – which, according to the U.S. Social Security Administration, would be most people outside of the super-rich – are deemed security risks by the Costa Rican government, what does that make those who made the move to the Central American country under the existing requirements? Are they a perceived security risk? Intentional or not, it is certainly a strange message coming from an usually meek-sounding government.

Costa Rica, of course, is a sovereign country and free to create and tinker with its policies as it sees fit. But the manner in which the government is trying to pass this legislature is flawed. First of all, the requirement increases are simply too great to be feasible, especially in today’s economic climate and with favorable living conditions developing in other countries in the region. If the core reason is money, then slight residency requirement increases would be met with far less opposition and still garner the same outcome: increased revenue.

Additionally, the Costa Rican government has been surprisingly blind to the long term economic consequences of hiked-up residency requirements. Regardless of their status, from expat to retiree, foreigners living abroad inevitably create job opportunity and revenue for the local population. It is similar to what the Detroit automakers are experiencing; close down a Ford factory, and the damage trickles down far past the auto factory workers, all the way to the company that supplies the nuts that go on the wheels. Significantly interrupting the expat and retiree flow will have the same negative effects, from construction labor to lumber and concrete to housekeeping jobs to the small local businesses where North Americans spend their hard earned dollars.

Foreign investments, another major vein of cash flow into Costa Rica, will also be pinched if these requirements are put into practice. Many in the expat community claim that outside investments will all but dry up; however, this seems a bit extreme. Nevertheless, a negative perception of the country stemming from an immigration policy that is practically impossible to obtain for the average retiree would inevitably have adverse effects on foreign investments.

There is nothing wrong, xenophobic, or mean-spirited about a country wanting to control its borders with a tight fist. It is simply good, responsible governing. But there are better ways to handle such a situation, ones that ruffle less feathers yet still accomplish the initial goals. Hopefully for the Costa Rican government, known for its centralism and level-headedness, a revamped version of the proposed legislation will come about that can satisfy both the Costa Rican people and the valuable expat and retiree community, all of which together have a strong and long-lasting relationship.

Read more about the state of Costa Rican immigration here