Costa Rica to Build National Route 35 to Boost Competitiveness of North Huetar Region

The Inter-American Development Bank (IDB) will support Costa Rica with a $335 million program for the construction of National Route 35 to improve traffic conditions between the northern and central areas of the country and boost competitiveness of the North Huetar Region’s productive sectors.

The IDB Board of Executive Directors approved a new $225 million loan and a modification to the Transportation Infrastructure Program, freeing up $110 million from that program to complete full funding of the interventions.

The new program will particularly benefit the agricultural and tourism sectors, including 75% of the products in the area’s farm input value chain, as well as 350 small and medium-size enterprises in the route's direct area of influence, by reducing travel time to logistics hubs. It will also benefit 3.2 million tourists who visit the region annually, with significant savings in travel time.

"We at the IDB are pleased to contribute to the development of strategic road infrastructure for Costa Rica, with a territorial approach that seeks to boost the competitiveness of the North Huetar Region,” IDB representative in Costa Rica Francisco Javier Urra said. “We are doing this by improving mobility conditions for agriculture, tourism and other productive activities that generate employment and prosperity for the population, while contributing to the country’s equitable growth."

The North Huetar Region stands out for its tourism, productive, agricultural and livestock potential. In 2019, its exports accounted for 7% of total national sales, with pineapple, juices, concentrates, and cassava as its main exports. At the same time, tourism to areas near the Arenal Volcano doubled between 2016 and 2019.

However, its competitiveness is impacted by the configuration of the routes to production hubs and tourist areas, which increase travel times and costs for producers and visitors alike.

To improve connectivity, the program intends to complete construction of National Route 35, which will connect National Route 1 (Bernardo Soto Highway) with the city of San Carlos (Ciudad Quesada and Florencia). It will do so following resilient design criteria set out in the disaster risk management and climate change plan, and the implementation of a Public-Private Partnership (PPP) model for its operation and maintenance.

The $225 million IDB loan has a 25-year repayment term, a 5.5-year grace period, and an interest rate based on SOFR. It is the second individual loan under a Conditional Credit Line for Investment Projects approved by IDB’s Board of Executive Directors in 2019.