Weeds in Costa Rica are taking over the farm, warns former president

Luis Guillermo Solis says government has to invest in people to keep the "pura vida"

A large Scotsman has lunch with former Costa Rican president Luis Guillermo Solis

In this year’s World Happiness Report, Costa Rica came sixth globally and number one in the Americas, ahead of Canada. It’s a positive image the government here has embraced, typified by the national saying “pura vida” (pure life), which embodies a sense of shared identity and optimism.

It is not entirely the construct of a marketing campaign - it is the predominant sense one gets of the country when you live the privileged life of a peripatetic ex-pat. The days can get very comfortable when all you see are well-tended gated communities and high-end beach resorts.

But this is clearly not the whole story. I sought out someone who could give me a more holistic view of the country, its politics and its history. My former tennis partner put me in touch with Christiana Figueres, the daughter of a former president, an ex-diplomat and the executive secretary of the U.N. Framework on Climate Change ahead of the 2015 Paris Agreement. She in turn recommended I speak to someone with an unparalleled perspective on recent events: ex-president Luis Guillermo Solis.

He kindly agreed to chat and we met for lunch in an Argentinian steak house in the San Pedro district of San José, the capital.

Solis was the president between 2014 and 2018, winning a landslide election for the left-of-centre Citizen’s Action Party, the first time PAC (by its Spanish acronym) had won power. He became most famous internationally for swallowing a wasp during a live press conference and managing to laugh it off.

An affable former academic of 67, with (thankfully) impeccable English, he offered a more sober perspective of his country than the tropical paradise advertised in the tourist brochures.

When he assumed power, Solis said he was taking over a weed farm (“una finca encharralada”), a country plagued by income inequality, poverty and corruption. I asked if his view has changed. “No, the encharralada has overgrown the finca,” he said, bluntly.

Costa Rica has held 17 peaceful election since the civil war of 1948, when a triumphant José Figueres, Christiana’s father, drafted a constitution guaranteeing universal suffrage and the abolition of the military.

Yet, Solis said indications that the “Costa Rican system” was becoming dysfunctional started appearing in the 1990s. The money saved on military spending was diverted into health, education and social services but Solis said it was becoming clear that without tax reforms, the system would go broke. “The very rich were getting sweet deals and not paying taxes, while at the other end, the poor were not paying taxes. We set up free trade zones that brought in businesses but don’t pay taxes either. At the same time, the bureaucracy kept on growing, so we became indebted.

“My father and grandfather were shoemakers. Good quality shoes and democracy look alike. Both require expenditures. Democracy is expensive,” he said.

Costa Rica has long targeted spending 8 percent of GDP on education, a figure it almost hit in 2017 on Solis’ watch. But that number fell to just 5.2 percent, including 1.5 percent on public universities, in 2024. The Costa Rican Social Security Fund (the CAJA), which looks after health and pension spending, is also facing financial pressures.

“I have no problem being fiscally responsible but if you want the country we’ve had for 80 years, we have to invest in people,” Solis said.

The former president has first hand experience with the strains of managing the public finances and keeping the economy bubbling, without it boiling over. In his first budget, he increased spending by 19 percent, which elevated debt owed to foreigners. As deficits rose to 6 percent of GDP, Moody’s downgraded Costa Rica’s credit rating and the OECD warned that reducing debt loads should be a very high priority for a country that Solis admitted was facing a liquidity crisis.

Budget deficits are now around half of what they were nearly a decade ago and economic growth was a healthy 3.9 percent in the first quarter of the year.

GDP per capita is higher than peers like Mexico, Colombia and even Turkey. Net financial debt to GDP is a manageable 60 percent and the unemployment rate of 7.5 percent last year, according to the OECD, is relatively high compared to its rich country peers but is low for the region.

Interest paid on public debt is around 5 percent of revenues and current fiscal policies are intended to keep the debt to GDP level declining.

This is no longer a country that just exports coffee and bananas. San Jose is ringed with medical device and semiconductor plants owned by U.S. giants like Intel, which now surpass agricultural commodities and tourism as the largest sources of revenue.

Photo by David Regueira on Unsplash

In its favour, it has a well-educated workforce; cheap, renewable power from hydro (though curiously very little from solar); and, an enviable climate.

Transparency International rated it as the 42nd most transparent country out of 180 - more similar to countries like Slovenia, Latvia and Poland than to its near neighbours Nicaragua (172nd), Guatemala (146th) or Honduras (154th).

Corruption is not unknown - two former presidents went to jail in the 1990s and Solis was himself accused of expediting Chinese cement imports - charges the Public Prosecutor dismissed. But, he said, brazen embezzlement is rare because of the institutional barriers like a robust independent media.

A bigger problem is the spread of illicit drug money, and an accompanying record rise in homicide levels (16.6 per 100,000, compared to around 12 during Solis’ time in government), as Costa Rica evolved from a point of trans-shipment to becoming a market for competing mini-cartels.

But Solis’ broader point is that this relative success was built on the back of past investments.

He said his father didn’t finish high school, yet all of his six children went to university (one to the University of Calgary). “There was an upward mobility resulting from the welfare situation that built a strong middle class,” he said.

He said there are too many tax loopholes that are exploited by rich Costa Ricans and that one of his priorities in government, the low female labour participation rate (27 percent lower than men) remains unaddressed. “We were able to diagnose the disease but we were not able to change everything in four years,” he said.

Solis is especially critical of the cuts to education and social services made by the current right-of-center government of Rodrigo Chaves, who was elected in 2022.

“For many years, I operated on the presumption that I didn’t need private medical insurance and I could rely on the CAJA (public system). Now, I don’t know,” he said.

The former president said that spending cuts are also apparent in the justice system. “Justice needs to be prompt and efficient. It’s as important a concept as being innocent until proven guilty. But some people are being detained for years before getting to trial. Justice has become highly politicized,” he said.

Solis said that, while the weeds have been growing, they are not yet out of control. “Institutions still matter and they are working,” he said.

The Chaves government does not have control of the legislative assembly of 57 members, which has allowed him to complain that his attempts at reform are being thwarted by entrenched advocates of the status quo.

Frustration with a system that appears to have atrophied has pushed Chaves’ approval rating to unprecedented levels for a president in his last year of office (he is barred from seeking re-election for a consecutive term by the country’s constitution).

But the next general election is scheduled for February 2026, and there are rumours that Chaves might even run to be a member of the legislative assembly. (To do so he would lose immunity from prosecution, which he may not want to do, given a number of legal controversies that are piling up against him).

Still, Chaves’ sympathies are clear. His friendship with El Salvador’s president Nayib Bukele has led to suggestions that he will mimic his neighbour’s tough-on-crime policies. Last year, he awarded Bukele Costa Rica’s highest honour and, earlier this month he announced he will build a prison modelled on the maximum security gang prison in El Salvador.

For many citizens faced with rising crime on their doorsteps, the solutions of the authoritarian right are appealing.

Chaves’ cavalier attitude to traditions and institutions is in keeping with the world around him.

The rise of strongmen leaders in Russia, China and the U.S. has decimated an international system run by rules, rather than hard power. We are now getting some reality therapy as countries scuttle to adjust.

For Costa Rica, a country without an army, the problem of a world where might is suddenly right is more acute than for most.

Solis professed himself unperturbed about threats from authoritarian neighbours like Nicaragua, which has made territorial claims on Guanacaste province. “Some people think that is naivé but if anyone wants to invade us, they will. We don’t have the know-how or hardware to withstand a major invasion,” he said.

Previous territorial incursions by the Ortega regime in Managua were resolved by rulings from the International Court of Justice. It is less than clear that a similar ruling would carry weight in an era when multilateralism is in retreat.

Despite the spreading weeds, Solis said that he is done with front-line politics.

“One reason is the Latin America malady that politicians consider themselves indispensable. The second is that by not taking part in successive elections, you are forced to stay out for eight years, by which time you are a different person and the country is different too.”

He may no longer be a politician but he remains an educator. His efforts to enlighten a Scots-Canadian on the intricacies of central American politics were much appreciated. I left our lunch, if not wiser, then much better informed.