What is the CRC (Costa Rican Colon)
The CRC (Costa Rican colón), is the national currency of the Republic of Costa Rica. The first issue of the currency in both coin and paper form came in 1896.
The name for the currency honors the Italian explorer, Christopher Columbus, or in Spanish Cristóbal Colón. Columbus was the first European to visit Costa Rica, on his final journey to the Americas in 1502. Legend has it that Columbus gave the country its name. However, that legend is unconfirmed.
BREAKING DOWN CRC (Costa Rican Colon)
The Costa Rican colón (CRC), was adopted as the national currency in 1896, about 70 years after Costa Rica and its Central American neighbors declared independence from Spain in 1810. The colón replaced the Costa Rican peso at par. or with a one-to-one exchange ratio. The previous peso currency, official since 1850, had been divisible into eight Spanish reales, which was legacy money held over from the colonial era.
The Republic of Costa Rica is on the thin strip of land that comprises Central America between Nicaragua and Panama. The country has a stable democracy, which is unusual for this area of the globe. The Republic declared independence from Spanish Rule in 1821, then from the First Mexican Empire in 1823, and finally from the Federal Republic of Central America in 1838. Final recognization of independence came in 1850.
Denominations for the Costa Rican Colón
Since the colón currency introduced at par to the peso, the two currencies were able to co-exist for a time. At introduction, gold coins ranging in denominations from two to 20 colones were issued, along with silver 50 centimos coins. One-hundred centimos equaled one colón or, at the time, one peso. These coins featured the G.C.R. imprint, for the national government. Also, paper peso and colón banknotes began to circulate in 1864 and 1896, respectively.
By the mid-1930s, after the establishment of the International Bank of Costa Rica, the country began to issue coins worth one colón and 25 and 50 centimos. These featured an imprint reading B.I.C.R. The National Bank of Costa Rica issued its coins in 1937, with a B.N.C.R. imprint. In 1951, the Central Bank of Costa Rica (BCCR), assumed responsibility for all currency issues. The bank expanded the range of denominations to include 20, 100, and 500 colones coins.
A handful of other financial institutions issued banknotes over the first half of the 20th Century until the BCCR became the sole issuer of the national currency. Banknotes, as with coins, saw the range of denominations grow, and eventually, include 10,000 notes by 1997. Banknotes display the portrait of a prominent Costa Ricans on the front with the reverse showing the natural beauty of the country.
Costa Rican Economy
The Central Bank of Costa Rica (BCCR) also has the task of managing national inflation and the colón's relationship to the U.S. dollar. In 2006, the BCCR established a crawling peg system under which the exchange rate would remain within an upper and lower limit deemed acceptable by the central bankers. In January 2015, the bank announced the CRC would be allowed to float against the dollar and that the bank would only intervene in extraordinary circumstances.
Along with the country's stable democracy, they also have a stable economy. However, Costa Rica has a growing foreign debt and budget deficit. The Republic also deals with issues of growing dollarization as the amount of bank-held national currency is replaced with foreign money.
Costa Rica has a Free Trade Zone (FTZ) which houses many foreign companies. This tax-free area plays host to many businesses in the technology sector, including Dell, IBM, Intel, and HP. According to the 2017 World Bank data, the Republic of Costa Rica experiences a 3.2% annual gross domestic product growth and has a 2% yearly inflation deflator.