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The Economy of the Osa Peninsula

Over the last several decades, Costa Rica has made laudable gains in its development, many of which are attributed to a shift from an internal economy to an economy integrated with the rest of the world. Their GDP figures are significantly higher than other countries in Latin America, and the country has ranked consistently high in both economic and political stability, unlike many of its neighbors. In the wake of the 1980s debt crisis, they came back stronger with new policies fomenting export growth and diversification, along with the attraction of foreign investment. Costa Rica’s economy is now mainly centered on specialty medical equipment and agricultural products such as bananas, pineapples, and chocolate. Within Costa Rica, different regions produce greater proportions of the country’s exports. The Osa Peninsula, located in southwestern Costa Rica, is home to Corcovado National Park as well as 2.5% of the world’s biodiversity. As a result, the area is mainly known for ecotourism, but small-scale agricultural operations do take place, alongside scientific research activities. The following is an analysis of five Costa Rican products that are produced on the Osa.

Timber

The Osa Peninsula is home to one of the last remaining stands of old-growth rainforest in Central America. While the beauty and biodiversity of the Osa’s forests attract attention now, less than a century ago they were most valued for their timber, or else cleared entirely to make room for pasture. The first company to exploit Costa Rica’s forest resources was Osa Forest Products (OFP). They bought 47,513 ha of land from the widow of an engineer that had worked for the United Fruit Company, the previous owner of the land, in 1957. After decades of exploitation, scientists went to the Costa Rican government to ask that the land be preserved for research. Thus, Corcovado National Park, which claims 40% of the peninsula, was born.

Timber products that are produced on the Osa today tend to be high-end products such as wood flooring and decking for domestic and international markets, and there are a plethora of artists making unique furniture pieces from Costa Rican trees and exporting them and the raw material for woodworkers in other countries. For the latter, kiln-drying is a method being employed to add value to the wood as opposed to traditional air-drying, as it makes the wood lighter and less costly to ship. All in all, the tight regulations on timber harvesting in Costa Rica ensure that the majority of forestland is protected for the country’s more important export – ecotourism.

Ecotourism

Monteverde Cloud Forest

Corcovado National Park was one of the first areas in Costa Rica to react to the rise in tourism that occurred in the 1990s, attributable to the increase in the number of educated adults from industrialized western countries seeking to escape their stifling environments. The Osa Peninsula became a pristine exotic destination, and as local people saw the opportunity that came with providing support to these travelers, the attitude toward the natural environment shifted from something to extract a subsistence living from to something to show off to foreign visitors. Of those employed on the Osa today, those who work in tourism tend to make twice as much income annually as those who do not. There is a general sentiment in Costa Rican families that at least one family member should be working in tourism for the family to make a decent living. Still, most ecotourism establishments such as ecolodges and hotels are owned by foreigners, while tour guides tend to be local. Earnings from tourism amount to over $1.7 billion annually, and it is estimated that 80% of visitors to Costa Rica come for eco-tourism-related activities.

Bananas

One of Costa Rica’s largest exports is bananas. At one time, revenue from the banana industry was greater than all tourism combined. Bananas are typically grown in the northeast region of costa rica, especially near the Sixaola River area, Santa Clara in the Alajuela Province, and in the Estrella valley. One place that bananas are grown on the Osa Peninsula is on the Osa Verde farm owned by the nonprofit Osa Conservation. On the farm, sustainable agriculture techniques are used to grow the Gros Michel variety and protect it from the fungus that nearly caused it to go extinct in the 1960s. While the work being done on this farm is admirable, it is not representative of the vast majority of banana production. 96% of all bananas produced for export are the Cavendish variety and are grown with heavy chemical inputs. The biggest importers of bananas are the US and the EU. Consumption of bananas in the U.S. alone is greater than apples and oranges combined. Some bananas that do not meet standards are sold locally at much cheaper prices. Of the ones that meet standards, they are ripened in “ripening rooms” with ethylene gas upon arrival in their destination company in order to make them as prime of a product as possible on supermarket shelves.

Vanilla

Vanilla is the most popular flavoring in the world, but incredibly labor and time-intensive to produce. Vanilla is actually a kind of orchid, and the only one to produce edible fruit out of the 25,000 kinds of orchids growing in central and South America. The vanilla orchid’s flower only blooms for 24 hours and if not pollinated in that time, the plant dies and there can be no fruit. Costa Rica is not a top producer of vanilla worldwide by any means, and vanilla growing operations on the Osa peninsula are not commercial in scale. One conservation organization, Osa Conservation, grows vanilla on its organic farm for the purpose of studying its role in the rainforest. For example, scientists still do not know what insect or animal pollinates the vanilla flower. This is a big mystery to be solved but for now, vanilla plants grown on farms commercial or otherwise must be pollinated by hand, in the same fashion invented by Edmond Albius in 1841.

Cacao

Before pineapples and bananas, Costa Rica’s main export was cacao. The history of cacao in Costa Rica is as rich as the food itself. It was a highly sacred crop among the tribes that lived in present-day Costa Rica, notably the Chorotega and the Bribri, who used it as currency up until the 1930s. A special drink would be made from the bean to denote special rituals and celebrations. Settlers adopted the cultivation of cacao, which did well until the 1970s when a fungus wiped out 80% of the cacao trees in Costa Rica. If it weren’t for the creation of a fungus-resistant kind of cacao tree, cacao likely would have disappeared from Costa Rica.

The provinces of Guanacaste, Alajuela, Talanca, Cartago, and Puntarenas all have thriving cacao plantations. On the Osa Peninsula, cacao production and ecotourism tend to go hand in hand. Visitors to the Osa can go on a number of “chocolate tours”, such as at the esteemed Finca Kobo farm, 30 minutes outside of Puerto Jimenez. As with many products grown and harvested on the Osa, chocolate is often consumed right near the site it was produced, contributing to a local, sustainable way of life. Cacao beans themselves are not really valuable or edible, and they must undergo significant processing to become the chocolate we all know and love. The beans must be roasted, then crushed, ground into a paste, conched, and tempered multiple times. The main destinations of Costa Rica’s surplus cacao beans are the Netherlands, Switzerland, Panama, the U.S., and Canada.

Sources

The successes and shortcoming of Costa Rica exports diversification policies Background paper to the UNCTAD-FAO Commodities and Development Report 2017 Commodity Markets, Economic Growth and Development. (n.d.). https://www.fao.org/3/i8308en/I8308EN.pdf

Nick St Clair. (2012). Osa Peninsula – The most biologically intense place on earth | Conservation | The Earth Times. Earthtimes.org. http://www.earthtimes.org/conservation/osa-peninsular-the-biologically-intense-place-earth/2020/

Botanika. (2019, August 20). History of the Osa Peninsula — Botánika Osa Peninsula, Curio Collection by Hilton. Botánika Osa Peninsula, Curio Collection by Hilton. https://www.botanikaresort.com/history-of-the-osa-peninsula/

Developing a sustainable wood products industry in rural Costa Rica. (2022). INITIATIVE 20X20. https://initiative20x20.org/restoration-projects/developing-sustainable-wood-products-industry-rural-costa-rica

2021 Guide to Corcovado National Park, Costa Rica. (2021, January 2). James Kaiser. https://jameskaiser.com/costa-rica-guide/parks/corcovado/#:~:text=Corcovado%20National%20Park%20takes%20up,tapirs%20%E2%80%94%20are%20common%20in%20Corcovado.

‌Costa Rica Mill. (2022). Costa Rica Mill – Exotic & unique Live edge wood slabs. Costaricamill.com. https://costaricamill.com/

Statistics on Timber Sector in Costa Rica – CentralAmericaData :: The Regional Business Portal. (2022). Centralamericadata.com. https://en.centralamericadata.com/en/article/home/Statistics_on_Timber_Sector_in_Costa_Rica

Rahim, S. (2018, July 23). Ecotourism in the Osa Peninsula: A Catalyst for Social, Economic, & Environmental Development. Medium; Medium. https://medium.com/@rahimsa/ecotourism-in-the-osa-peninsula-a-catalyst-for-social-economic-environmental-development-e29e5f3ebf4b

About Costa Rica | Embajada de Costa Rica en DC. (2021). Costarica-Embassy.org. http://www.costarica-embassy.org/index.php?q=node/19#:~:text=Costa%20Rica%20receives%20over%201.7,do%20eco%2Dtourism%20related%20activities.

Bananas: The Spotty Past and Precarious Future of the World’s Most Consumed Fruit – Osa Conservation. (2016, June 3). Osa Conservation. https://osaconservation.org/bananas-the-spotty-past-and-precarious-future-of-the-worlds-most-consumed-fruit/

Hays, J. (2019). VANILLA: ITS HISTORY, CULTIVATION AND PROCESSING | Facts and Details. Factsanddetails.com. https://factsanddetails.com/world/cat54/sub345/item1608.html

The Unexpected Values of Vanilla – Osa Conservation. (2017, June 14). Osa Conservation. https://osaconservation.org/unexpected-values-vanilla/

Parker, J. (2017, March 15). A Brief History of Costa Rica’s Chocolate. Culture Trip; The Culture Trip. https://theculturetrip.com/central-america/costa-rica/articles/a-brief-history-of-costa-ricas-chocolate/

Cocoa Beans in Costa Rica | OEC. (2019). OEC – the Observatory of Economic Complexity. https://oec.world/en/profile/bilateral-product/cocoa-beans/reporter/cri#:~:text=The%20main%20destinations%20of%20Costa,and%20Canada%20(%2430.8k).

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