Costa Rica Tourism Faces Cost and Currency Pressure as San José Competes for Regional Travellers

Costa Rica tourism faces cost and currency pressure as San José competes for regional travellers in an increasingly crowded Latin American market. The strength of the Costa Rican colón against the US dollar has become a major concern for tourism businesses because many operators receive revenue in dollars while paying salaries, utilities, fuel and local suppliers in colones. At the same time, tourism growth has slowed compared with several competing destinations, increasing pressure on Costa Rica to protect the competitiveness of a travel product built around nature, sustainability, wildlife and outdoor experiences.

The situation does not mean Costa Rica has stopped attracting international travellers.

The Costa Rican Tourism Institute continues to report historically strong air connectivity, while the country’s tourism sector remains one of Central America’s best established.

The challenge is increasingly about value and competitiveness.

Strong Colón Creates Pressure on Tourism Businesses

Costa Rica’s National Chamber of Tourism, known as CANATUR, has repeatedly warned about the effect of the exchange rate on tourism businesses.

The problem comes from a mismatch between revenue and costs.

A significant part of Costa Rica’s international tourism economy operates in US dollars because foreign visitors commonly pay for hotels, tours and other services in dollars.

Many business expenses, however, are paid in Costa Rican colones.

These include:

• Employee salaries
• Social-security costs
• Electricity
• Water
• Fuel
• Maintenance
• Local food and supplies
• Domestic services

When the colón strengthens against the dollar, every dollar earned converts into fewer colones.

A tourism company can therefore receive the same dollar revenue from a visitor while having less local currency available to cover its Costa Rican expenses.

Why the Exchange Rate Matters

The basic effect can be illustrated simply.

CANATUR warned in late 2025 that the prevailing exchange rate was at its lowest level in almost two decades and was affecting the financial stability and competitiveness of tourism companies.

The organisation has continued to place competitiveness among its priorities during 2026.

Costa Rica Uses a Managed Floating Exchange Rate

It would be inaccurate to describe Costa Rica’s government or Central Bank as completely ignoring the exchange rate.

Costa Rica operates a managed floating exchange-rate regime.

The Central Bank of Costa Rica says the value of the currency is primarily determined by supply and demand in the foreign-exchange market.

Importantly, the Central Bank does not pursue a predetermined dollar-to-colón exchange-rate target.

Its policy is not designed to push the currency towards a specific value.

However, the bank can intervene when it believes excessive volatility is interfering with orderly market conditions.

That distinction matters.

Costa Rica does not operate a fixed exchange rate, but neither does the Central Bank promise never to enter the foreign-exchange market.

Central Bank Intervened During 2026

The operation of that policy was demonstrated in February 2026.

Costa Rica experienced an unusually large surplus of foreign currency.

Between 1 and 27 February, the private foreign-exchange market generated a surplus of US$659 million, according to the Central Bank.

That was substantially higher than the average recorded during the comparable period between 2023 and 2025.

The additional supply created further downward pressure on the exchange rate.

In response, the Central Bank purchased US$259.1 million through stabilisation operations.

The intervention was designed to prevent abrupt movements rather than establish a particular exchange-rate level.

For tourism businesses, that difference is important because it means the sector cannot assume the Central Bank will deliberately weaken the colón simply to improve tourism competitiveness.

Tourism Growth Has Slowed Against Regional Competitors

Currency pressure comes at a time when Costa Rica’s tourism industry is examining its competitive position more closely.

CANATUR reported that international tourist arrivals by air increased by approximately 1% during 2025.

The organisation welcomed the return to growth but described the performance as insufficient when compared with international and regional tourism trends.

CANATUR cited stronger growth in several competing destinations.

These figures do not mean the destinations offer identical tourism products.

Costa Rica’s nature-led tourism model differs significantly from the large resort sector in the Dominican Republic or the urban, cultural and coastal products available in Mexico and Colombia.

Nevertheless, international travellers choose between destinations when deciding how to spend limited holiday budgets.

Price and perceived value can therefore matter.

Costa Rica Still Has Strong Air Connectivity

The competitiveness challenge should also be balanced against Costa Rica’s substantial aviation access.

The Costa Rican Tourism Institute reported that international airline seat capacity increased from approximately 5.1 million seats in 2024 to around 5.48 million in 2025.

That represented growth of about 7.7%.

For 2026, scheduled capacity has moderated to approximately 5.3 million seats.

ICT still describes that level as historically high.

Air connectivity remains one of Costa Rica’s major tourism advantages because international travellers can access the country from important North American, European and Latin American markets.

Price Becomes More Important in Destination Competition

Costa Rica has spent decades building an international reputation around biodiversity, national parks, beaches, adventure and sustainable tourism.

That positioning remains valuable.

But a strong destination brand does not remove price sensitivity.

Travellers compare:

• Airfares
• Hotel rates
• Food costs
• Ground transport
• Car hire
• Excursion prices
• National park costs
• Total holiday expenditure

A destination can therefore remain desirable while becoming more difficult for some travellers to afford.

For travel agents, the issue is not simply whether Costa Rica is “expensive”.

The more useful question is whether travellers believe the experience provides sufficient value compared with alternative destinations.

Costa Rica Is Developing a New Tourism Strategy

The tourism industry is responding by placing greater emphasis on competitiveness, sustainability and resilience.

CANATUR has developed a National Tourism Strategy for 2026–2035 following discussions involving tourism-sector stakeholders.

The strategy is intended to create a longer-term framework for the industry.

Costa Rica’s official tourism authorities are also focusing on connectivity, investment, infrastructure and destination competitiveness.

These priorities matter because exchange rates are only one part of the tourism equation.

A country can improve competitiveness through better infrastructure, efficient transport, strong air connections, service quality, technology and tourism products even when it cannot control global economic conditions.

Safety Claims Require Careful Treatment

Safety is another factor that can influence destination choice, but it should be handled carefully.

The available official evidence does not establish that traveller safety concerns are currently the principal reason for Costa Rica’s slower tourism growth.

It would therefore be misleading to present rising safety fears as a proven explanation for the country’s competitive position without supporting visitor research.

Travellers consider many factors simultaneously.

Economic conditions in source markets, airfare availability, currency movements, competing destinations, geopolitical events and changing holiday preferences can all influence arrivals.

Tourism performance should consequently be assessed using several indicators rather than attributing changes to one issue.

What Travel Businesses Should Watch

Travel agents and tour operators selling Costa Rica should monitor several indicators through the remainder of 2026 and into 2027.

The most important include:

• Dollar-to-colón exchange-rate movements
• International airline capacity
• Tourist arrival growth
• Hotel pricing
• Tourism-sector operating costs
• Performance of major North American and European source markets
• Growth in competing Latin American destinations
• Implementation of the 2026–2035 tourism strategy

These factors will provide a clearer picture of whether the current competitiveness pressure is temporary or structural.

Costa Rica Still Has a Distinctive Tourism Proposition

Price competition does not erase Costa Rica’s established strengths.

The country’s protected natural areas, biodiversity, Pacific and Caribbean coastlines, wildlife and adventure products continue to give it a distinctive place in the international tourism market.

Costa Rica also benefits from decades of destination recognition around sustainable tourism.

The challenge is maintaining that premium position while ensuring visitors continue to perceive strong value.

Competing purely on the lowest price would be difficult and potentially inconsistent with Costa Rica’s tourism model.

Improving productivity, connectivity, service and visitor experiences may therefore prove equally important.

Conclusion: Costa Rica Tourism Faces Cost and Currency Pressure as San José Competes for Regional Travellers

Costa Rica tourism faces cost and currency pressure as San José competes for regional travellers because the strong colón has created a difficult operating environment for businesses that earn substantial dollar revenue while paying many expenses in local currency.

CANATUR has repeatedly identified the exchange rate as a competitiveness problem. At the same time, Costa Rica’s approximately 1% growth in air arrivals during 2025 was weaker than the growth rates the organisation cited for several competing Latin American destinations.

However, the situation requires balance.

Costa Rica’s Central Bank does not target a specific exchange rate, but its approach is not entirely hands-off. The country operates a managed floating system, and the bank can intervene to smooth excessive volatility, as it did with US$259.1 million in stabilisation purchases during February 2026.

Costa Rica also retains historically strong international airline capacity and one of the region’s most recognisable nature-based tourism brands.

The challenge is therefore not simply attracting visitors. It is maintaining competitiveness while local operating costs, currency conditions and regional competition change.

For travel businesses, that makes pricing and value increasingly important. Costa Rica remains a powerful tourism destination, but its next phase of growth will depend on how successfully the country balances its premium tourism identity with affordability, connectivity and the changing economics of international travel.