In Guanacaste’s tourist areas, the dollar is everywhere: on menus, at lodging facilities, on products in stores, on billboards… But today, that dependence is working against them.
The exchange rate has reached one of its lowest levels in decades. According to the Central Bank of Costa Rica, on March 24, the dollar was trading at ¢464.76, far from the ¢660.77 recorded in March 2022.
The impact is immediate for businesses that charge in dollars and receive fewer and fewer colones to cover expenses that are mostly in the local currency.
Rodrigo Meza, owner of the transportation company Congo Transfers in Nosara, experiences this daily. On Monday, March 16, his six minibuses were in operation, and he expected revenue of around $1,600 (¢743,000). Less than two years ago, that same amount of dollars was worth approximately ¢1.000.000.
“It’s a worrying issue because this is declining day by day. No one is talking about it being a crisis that will last for so many months or years—at least so you can say, ‘Look, it will end in three months,’” says Meza.
The executive director of the National Chamber of Tourism (Canatur), Shirley Calvo, says that in the medium term, the quality of tourism services will be affected, and the high prices tourists are paying in the country will no longer be justifiable.
As the profit margins of tourism companies—particularly small and medium-sized ones—shrink, the margin for investment and renovations, equipment upgrades, and facility improvements is shrinking,” says Calvo.
An impact already being felt
Calvo asserts that the negative effects of the sustained decline in the dollar are already beginning to be felt: tourism companies are postponing investments, some establishments are raising prices, and they are not hiring new staff to handle the high season.
These impacts are a snowball effect that is undermining the country as a tourist destination.
“The first thing business owners report to us—especially those on the coast—has to do with maintenance. (…) They say they’re postponing these investments because the upcoming off-season is full of uncertainty,” says Calvo, though he admits that the current high season is seeing favorable visitor numbers.
Businesses are increasingly in need of dollars to cover their operating expenses, which they pay in colones.
The Guanacaste Chamber of Tourism (Caturgua) is also beginning to see the impact on the sector. According to the chamber’s executive director, Rebeca Álvarez, the decline in profits is leading to job losses.
“There are companies reporting that they’ve had to lay off their employees. Perhaps the company hasn’t closed, but they’ve become self-employed. So, where there used to be a small or medium-sized business with two, three, four, or five employees, now there’s just the family,” Álvarez explains.
The executive director points out that small and medium-sized businesses are the hardest hit. “Not the entire sector has the same resilience. Not all companies can withstand this equally. Eighty-five percent of our members are small and medium-sized businesses.”
The Olas Verdes Hotel, located in Nosara, is one of the businesses strategically navigating the currency shift. “We’re in survival mode. We’ve already hit rock bottom, and now we’re even lower,” says manager Luis Pardo. According to his calculations, by the end of 2025, the dollar’s decline resulted in an approximate loss of $600,000.
The hotel has a permanent staff of 40 workers and typically hires six more people during the high season. However, this year they decided not to hire additional staff to absorb the financial losses resulting from the exchange rate. They also halted investments in hotel improvements.
Every year we used to carry out three or four improvement projects to meet guests’ demands. All of that had to be put on hold this year,” says Pardo.
The impact on hoteliers, businesses, and the workforce has a simple explanation: their main revenue comes in dollars, but they must cover most of their expenses in colones, according to Calvo, Pardo, and Marcela Román, an economist at the University of Costa Rica (UCR).
“There is a relative increase in costs, and this reduces business profitability,” says Román.
Is switching to colones the solution?
Despite the sharp drop in the dollar, Moisés Diaz remains calm. He runs a food business in Tamarindo, Santa Cruz, and believes the key is to price his services in colones.
Furthermore, Diaz notes that tourist visits to Tamarindo have increased, which allows him to weather the current situation.
“We’re seeing less money coming in, but we’re not suffering because there’s no cash… I don’t think people are going under because of the exchange rate because there’s still enough tourism to generate profit,” says Diaz.
Diaz does not depend directly on the exchange rate to sustain his income. Moreover, his rent is in dollars, so the dollar’s decline means he needs fewer colones to pay it.
Stopping charging in dollars is one of the options being considered by Maryling Esquivel, owner of a clothing and souvenir shop in Guiones y Pelada, the most touristy part of Nosara. Unlike Díaz, all her prices are in dollars. She estimates that her income has decreased by about 10% in recent months.
For Maryling Esquivel, an entrepreneur in Nosara, lower income today means greater uncertainty about getting through the upcoming off-season.
“We price all our merchandise at a higher exchange rate, and we’re absorbing that difference ourselves. It’s just not as profitable anymore,” Esquivel said. The brunt of the impact falls mainly on her employees. “They receive a bonus for each sale made in dollars, and that makes up a large part of their salary.”
Economist Román agrees that charging in the national currency helps cushion losses, but believes that in the medium term it has negative consequences for the tourism sector and for businesses.
“It’s a mechanism that can provide stability in the short term, but it’s not a fundamental solution. Tourists continue to bring in dollars, and those dollars go further and further, which makes the destination more expensive,” Román notes. As the destination becomes more expensive, the sector continues to lose competitiveness compared to other places.
For Román, the phenomenon stems from a broader problem: a relative increase in the country’s cost of living that reduces the profitability of tourism companies and weakens their competitiveness compared to other destinations.
When the dollar rises again, these businesses that decided to switch to colones will suffer from the devaluation of the colón,” the economist argues.
Three Proposals to Address the Falling Dollar
There are currently two bills before the Legislative Assembly aimed at mitigating the impact of the falling dollar.
One of the bills, introduced by Guanacaste Representative Daniel Vargas, seeks to allow individuals and businesses to pay for services and taxes in dollars. The other was introduced by Representative Horacio Alvarado and aims to allow workers and employers to negotiate changes to the currency of payment established in employment contracts.
In addition, Caturgua is working on a series of proposals to present to the Minister of Tourism, according to the Chamber’s executive director. One of them involves making overtime pay more flexible and substituting it with time off or days off.
Below are the details of the three initiatives:
1- Paying for Services in Dollars
Services such as electricity and water, payments to the Costa Rican Social Security Fund (CCSS), municipal taxes, and other administrative fees could be paid in dollars. That is the spirit of Bill No. 24,877, “Law to Grant Liberatory Power to the United States Dollar for Transactions with the State.”
“Many companies and individuals conduct the majority of their operations in dollars, and today we are forcing them to convert to colones to meet their obligations to the State, which makes no sense,” said Representative Vargas.
Although economist Román is unfamiliar with the bill, she noted that it is necessary to analyze who would bear the impact of the exchange rate.
“We must be careful with first impressions. I’ll give you my initial take: I’d say it’s an attempt to shift exchange rate risk onto public institutions. We need to think this through very carefully,” she said.
The bill was introduced in March 2025 and is currently before the Economic Affairs Committee.
2- Negotiating currency in employment contracts
Congressman Horacio Alvarado introduced a bill, File No. 24,386, to amend Article 165 of the Labor Code. If approved, the law would allow employers and employees to negotiate, with the mediation of the Ministry of Labor and Social Security, the currency in which they receive their wages.
Currently, in Costa Rica, it is possible to receive wages in either colones or dollars, but there is no clear regulation for changing the currency specified in the contract.
“The bill aims to address the situation of sectors that generate income in dollars, such as tourism and exports, but which face difficulties when the exchange rate drops, as they receive fewer colones for their earnings. This can affect the sustainability of businesses and put jobs at risk,” explains Representative Alvarado.
Labor lawyer Armando Blanco warns that changing the currency of payment could violate the law if it results in a reduction of the worker’s wages.
“We need to review the fine print of the bill. If the result is a situation where people’s income decreases, then there would be a problem that could eventually affect the legality and constitutionality of this change,” says Blanco.
The bill was introduced in July 2024 and is currently before the plenary session to receive the first motions.
3- Exchanging overtime for time off
Caturgua is considering proposing a bill to the Minister of Tourism that would allow employers, with the worker’s consent, to compensate for overtime pay with time off.
“Currently, you cannot pay an employee for additional hours worked with time off or days off—or at least you shouldn’t. There are many organizations and companies that would require something like this,” says Álvarez.
Álvarez believes the proposal would allow companies to adjust their expenses, such as payments to the Costa Rican Social Security Fund (CCSS), for overtime worked.
Article 139 of the Labor Code stipulates that overtime must be paid at a rate 50% higher than regular hours. According to attorney Blanco, this means that one hour of overtime worked should be compensated with one and a half hours off.
“If a worker accumulates, say, ten hours of overtime in a week and is to be compensated, it should be with 15 hours off, for example. So that the worker isn’t losing—let’s put it this way—money or wages,” says Blanco.
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