Country context (P3 lens)

Costa Rica is an upper-middle-income country in Central America with a growing and structured P3 market. P3s are used to mobilize private capital, accelerate infrastructure delivery, and transfer operational risk, particularly in transport, energy, water, and social infrastructure. The government has implemented legislation and institutions to manage and oversee P3s, attracting both domestic and international investors.

Verified sources: World Bank PPP Knowledge Lab, Costa Rican National Concessions Council (CNC), IMF, OECD.

Economic and infrastructure conditions

• Economy: Service- and tourism-driven, with agriculture and industry; stable fiscal environment supports infrastructure investment.

• Infrastructure priorities:

  • Highways, roads, and bridges

  • Airports, ports, and urban transport

  • Electricity generation and distribution (including renewables)

  • Water supply, sanitation, and municipal services

  • Hospitals, schools, and other social infrastructure

• Private sector: Experienced domestic and regional investors, often partnering with international firms for P3 delivery.

Costa Rica’s development context favors bankable, revenue-generating projects with clear risk allocation.

Public Private Partnerships framework

Legal and institutional setup

• Governed by the Concessions Law (Law No. 7762) and managed through the National Concessions Council (CNC).

• Projects undergo feasibility studies, value-for-money assessments, and fiscal risk evaluation.

• Typical P3 structures:

  • Concessions for highways, bridges, airports, ports, and urban transit

  • Build-Operate-Transfer (BOT) for energy and utilities

  • Availability-payment contracts for hospitals, schools, and municipal services

Market characteristics

• P3s are selective but increasingly active, with a strong regulatory framework and clear approval processes.

• Financing often involves revenue-sharing mechanisms or availability payments, with support from development banks where needed.

• Investor base includes domestic, regional, and international participants.

Sector experience and opportunities

Transport

• Toll roads, highways, bridges, and urban transit are the most active P3 sectors.

• Airports and ports structured as concessions or BOT projects.

Energy and utilities

• Renewable energy projects (hydro, solar, wind) delivered under BOT or concession arrangements.

• Electricity distribution and municipal utilities increasingly involve private participation.

Water and municipal services

• Urban water supply, wastewater, and sanitation projects structured as concessions or service contracts.

Social infrastructure

• Hospitals, schools, and public buildings delivered through availability-payment P3s, often with performance-based lifecycle monitoring.

Key P3 considerations

• Project preparation: Feasibility, financial modeling, and lifecycle cost analysis are standard.

• Risk allocation: Construction and operational risks transferred to private sector; demand, regulatory, and fiscal risks retained by government.

• Institutional capacity: Strong, with CNC providing oversight and technical support.

• Market depth: Competitive domestic, regional, and international investor and contractor base.

Outlook

Costa Rica is a growing and structured P3 market:

• Active sectors: transport, energy, water, and social infrastructure

• Strong legal and regulatory oversight ensures value-for-money and risk management

• Projects are typically medium- to large-scale, bankable, and capable of attracting long-term private investment

Links