Q COSTARICA — The Cámara Nacional de Turismo (Canatur)— National Chamber of Tourism — expressed its concern about the impact of the dollar exchange rate on tourism.
The current rate (¢487.73 for buy and ¢492.91 for the sell) is the lowest in almost twenty years and is affecting the sector’s financial stability.
Canatur noted this happens right as the high season kicks off. Around this time, businesses face higher costs and have to ramp up their operations to keep up with the surge in demand.
Companies face higher costs due to hiring temporary staff, using more basic services, and the need for maintenance and supplies. These expenses are paid in colones, which increases financial pressure.
“During the peak tourist season, businesses face natural increases in their expenses, including hiring temporary staff, higher consumption of basic services, increased operations, maintenance, and the acquisition of supplies to guarantee service quality. However, these costs are paid in colones, while a significant portion of the sector’s revenue is received in dollars,” said Shirley Calvo, executive director of Canatur.
Canatur emphasized that the difference between revenue in dollars and costs in colones directly impacts the sector’s liquidity. Many businesses require exchange rate stability to sustain their operations.
The outlook is complicated by the cumulative decline in international arrivals throughout much of the year. This drop further reduced revenue at a time when greater liquidity is needed.
The Chamber warned that the management of the dollar exchange rate policy makes Costa Rica more expensive compared to competing destinations. Countries like Mexico, the Dominican Republic, Colombia, and Panama offer more affordable costs and greater support for tourism.
The organization stated that there is a misconception about the sector’s true situation. This perception has led to minimizing the impact of the exchange rate on tourism competitiveness.
Calvo noted that the majority of the sector is made up of small and medium-sized enterprises (SMEs) – PYMEs in Spanish. She pointed out that more than 85% are small, family-run businesses that depend on consistent income to operate.
“Tourism is not a sector for large corporations. More than 85% of the country’s businesses are micro, small, and medium-sized enterprises. They are family businesses, hotels with fewer than 20 rooms, restaurants, tourist transportation companies, guides, small tour operators, and local suppliers,” he added.
Despite the adverse conditions, businesses are striving to maintain service quality. The sector continues its efforts to ensure positive experiences for visitors.
Canatur stated that tourism is not receiving the strategic recognition it deserves for the national economy. The industry generates direct and indirect employment in many communities across the country.
The Chamber indicated that it has conveyed its concerns and needs to the authorities. This message includes small, medium, and large businesses that support the tourism value chain.
“As an organized chamber, we have communicated the sector’s concerns and needs to the authorities, from the smallest to the medium and large businesses, because everyone plays a fundamental role in the tourism value chain and everyone generates direct and indirect employment in the communities.
“However, we do not feel that the real impact of the exchange rate on the competitiveness of tourism, one of the pillars of the Costa Rican economy and an engine of local development in many communities, is being acknowledged,” it concluded.