Deals to link Costa Rican market

Infrastructure, investment and trade to increase with series of agreements

President Xi Jinping's visit to Costa Rica boosted economic ties between the two countries after a series of agreements in infrastructure, trade and investment were signed on Monday.

President Xi Jinping and his wife Peng Liyuan visit a rural family in Heredia, Costa Rica, on Monday. Lan Hongguang / Xinhua

The two countries concluded agreements on economic and technical cooperation, quality inspection of pork products exported to China, construction of a joint oil refinery on Costa Rica's Caribbean coast, and Chinese funding for the expansion of a highway between San Jose and Puerto Limon, 200 km east of the capital.

They also agreed on substantial purchase orders of oxhide and timber exported to China, but the exact price tag on these orders was not released.

Xi told reporters after the meeting that China would like to have more pragmatic cooperation with Costa Rica and further expand bilateral trade.

Costa Rican President Laura Chinchilla said her country highly values the Chinese market. She said the first shipment of dairy products from Costa Rica would be exported to China soon, and the country hopes to follow it up with exports of more agricultural and industrial products.

"The export of our dairy products shows that if you bravely explore the Chinese market, you will definitely have gains," Chinchilla said.

She said her country is eager to have more cooperation with China in tourism, finance, infrastructure, clean energy and education, adding that Costa Rica would issue policies to make it easier for Chinese people to secure visas to Costa Rica.

Eduardo Ulibarri, Costa Rica's permanent representative to the United Nations in New York, hailed Xi's visit, noting that it has given "new momentum" to a young relationship between the two countries, which established diplomatic ties in 2007.

"These trade agreements will help boost the free trade agreement between China and Costa Rica, and for us it is very important," Ulibarri said.

China and Costa Rica signed a free trade agreement in 2011. It covers a wide range of areas with more than 90 percent of goods traded between the two countries enjoying zero tariffs on a stage-by-stage basis.

The infrastructure agreements signed during Xi's visit would also help move the country's development strategy forward, said Ulibarri. "The impact from China is very significant."

Ariel Armony, director of the Center for Latin American Studies at the University of Miami, said some of the cooperation agreements discussed by the two presidents — such as the joint oil refinery and expansion of the highway between San Jose and Puerto Limon — are auspicious.

"But they should follow strict environmental standards," Armony said. "China should look at Costa Rica's successful experience in the production of semiconductors and medical equipment, and Costa Rica offers very attractive opportunities for Chinese investment in high-tech industries."

In the six years since the two countries established diplomatic ties, China and Costa Rica's cooperation has made big strides in many areas with high-level political mutual trust, said former Chinese ambassador to Costa Rica Li Changhai.

Costa Rica's well-developed social economy and long-term political stability make it easy for the two countries to cooperate, Li said.

Two visits from Chinese presidents within six years — the other by former president Hu Jintao in 2008 — show that China attaches great importance to its relationship with the Central American nation, Li said.

China is Costa Rica's second-largest trading partner, just behind the United States, while Costa Rica is China's ninth-largest trading partner in Latin America. Two-way trade rose from $4.7 billion in 2011 to $6.2 billion in 2012.

Xi said that China and Costa Rica are developing countries and face the same challenges of growing an economy and improving their people's lives. He proposed the two countries maintain high-level visits and "firmly support each other on issues of core concern to the other side".

"With our joint efforts, relations between China and Costa Rica could become a model for cooperation between countries that are of different sizes and conditions," Xi said.

Ulibarri said: "China and Costa Rica, despite having established diplomatic ties six years ago, have a comprehensive relationship."

Xi arrived in San Jose on Sunday evening for his second stop of a three-nation tour of Latin America and the Caribbean — his first Latin America trip since he assumed the presidency in March. Xi will hold a summit with US President Barack Obama in California on June 7 and 8.