Network LatAm 2010: Latin America’s green destination

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As Costa Rica prepares to host Network Latin America 2010, taking place in San Jose on 5-7 December, the country is starting to see a surge in traffic driven by ecotourism and economic growth 

Costa Rica's largest carriers and its main airports are planning further expansion as the country's popularity as an ecotourism destination continues to grow.

Traffic at San Jose's Juan Santamaria Airport was up 4.9% through the first three quarters of 2010 to 2.4 million passengers, according to Aeris, the consortium which operates the airport.

Looking to the future, Aeris chief operating officer Tom Bartlett expects 4.7% traffic growth in 2010, followed by an 11% increase in 2011 and a further 8% in 2012.

To accommodate this projected traffic growth, Aeris' newly updated master plan for Santamaria envisions further expansion of the international terminal and constructing a new domestic terminal over the next five years. The international terminal, which in July opened an expanded lobby, immigration hall and check-in area, is now slated receive five additional gates.

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This surge in traffic is being driven primarily by growth in tourism. "Last year Costa Rica didn't have the expected growth because of the 2009 crisis. Tourism decreased more or less 7% compared with 2008," says TACA regional sales director for Mexico, Central America and the Caribbean Ricardo Granillo. But he adds: "2010 is almost reaching 2008 levels, when tourism was at its highest level."

El Salvador-based Grupo TACA is Costa Rica's largest carrier, operating 153 weekly flights from San Jose.

Granillo says TACA has been working with Costa Rica's tourism institute "to maximise resources and promote Costa Rica as a preferred tourism spot". He adds that TACA plans to increase frequencies and open new destinations "to facilitate getting there". In July TACA added its 17th destination from San Jose, the Colombian city of Medellin.

Costa Rica has successfully positioned itself as one of the world's foremost ecotourism destinations by promoting its biodiversity and wildlife. It has a breathtaking mix of volcanoes, rainforests and beaches - on both the Pacific and Caribbean coasts - and all this is packed into a country which is only slightly larger than Switzerland.

"I'm mesmerised. Now I understand why everyone wants to go to Costa Rica. The beauty is incredible. It's a wonderful, wonderful country," exclaims American Airlines country manager for Costa Rica Eduardo Del Pozo, who moved over to San Jose earlier this year after working for American in four other Latin American countries.

Del Pozo adds that eco-friendliness "is ingrained in the culture" and that Costa Rica is cleaner and greener than anywhere else in Latin America.

GROWTH MARKET

American is San Jose's second largest airline by passengers carried and the largest carrier on US routes. The airline, which recently celebrated its 20th year anniversary in Costa Rica, currently operates four daily flights to San Jose from Miami and one daily flight from its Dallas hub.

In April American also launched four weekly flights to San Jose from New York JFK. "That flight has been tremendously successful for us," Del Pozo says. "We're very pleased with the performance." He adds: "Absolutely my plan is to go daily" with New York-San Jose.

Launching a San Jose-Los Angeles service is also in American's plans, says Del Pozo. The US carrier previously operated a seasonal San Jose-Los Angeles service, but dropped it in 2007.

Los Angeles, along with Orlando and Washington, are American's top three one-stop destinations out of San Jose.

Del Pozo says American has a healthy mix of ethnic, leisure and business traffic in Costa Rica. On its JFK and Dallas flights about 80% of passengers are ticketed in the USA, but for Miami about half of the passengers purchase their tickets locally.

According to Aeris figures, so far this year 24% of passengers flying in and out of San Jose were Costa Rican nationals.

TECHNOLOGY TREND

Del Pozo says for American's website Costa Rica is the fourth biggest Latin American market after the much larger countries of Mexico, Brazil and Argentina. He credits this to Internet penetration, which is significantly higher in Costa Rica compared with other Central American countries. But Del Pozo is equally quick to point out that Internet booking is not the preferred channel for everyone.

While American has been rapidly closing city ticket offices in most parts of the world, the carrier has just opened two new offices in San Jose, giving it three in the capital city. Del Pozo says the initial revenues generated by the second office are "mind boggling" and shows "there's still a segment in Latin American that prefers to do business one-on-one".

While Costa Rica has emerged as a major leisure destination, at the same time it has also become a major business hub for the region. American points out that 85 Fortune 500 companies now have offices in San Jose and primarily these offices also serve as company regional headquarters.

Granillo says the business market "has grown mainly because more multinational companies have moved their headquarters to Costa Rica. The government has given special conditions to attract international investment to the country. Securities are very high, from the institutional, legal and personal point of view and additionally Costa Rica offers a high quality of life."

While San Jose now boasts Central America's largest expatriate population, which helps fuel business traffic, the country's sun-drenched west coast has become a magnet for holiday homes. The beaches of Costa Rica's increasingly popular Guanacaste province are served from the city of Liberia, which in late 2002 completed an airport expansion project that gave Costa Rica its second international airport.

Del Pozo says Liberia is an even faster growing market than San Jose. American is Liberia's largest carrier, with service from both Dallas and Miami which increases significantly during the peak winter season.

"It's a high-end leisure market," Del Pozo says. "Snowbirds flock there in the winter. Many have second homes there - many of the rich and famous."

SECOND AIRPORT

Liberia's Daniel Oduber Quiros International Airport, which is operated by a separate consortium that includes some but not all of the shareholders which comprise Aeris, will be served by at least four US carriers this winter.

In response to an expected traffic boost, the airport is about to embark on its own terminal expansion project. The growth will likely include TACA, which does not currently serve Liberia.

"So far TACA only flies to San Jose, but in the short term we are analysing the possibility to fly directly to Guanacaste and facilitate arrival of tourists from North, Central and South America there," Granillo reveals.

While Liberia has become a leisure option, San Jose will clearly remain Costa Rica's main hub. Granillo says at San Jose about 70% of traffic on TACA's North American routes and about 60% of traffic on its South American routes currently transfer to other TACA international flights.