Coffee production in the country began in 1779 in the Meseta Central which had ideal soil and climate conditions for coffee plantations.
Coffea arabica first imported to Europe through
Arabia, whence it takes its name, was introduced to the country directly from
Ethiopia. In the nineteenth century, the Costa Rican government strongly encouraged coffee production, and the industry fundamentally transformed a
colonial regime and village economy built on direct extraction by a city-based elite towards organized production for export on a larger scale. The government offered farmers plots of land for anybody who wanted to harvest the plants. The coffee plantation system in the country therefore developed in the nineteenth century largely as a result of the government's open policy, although the problem with coffee barons did play a role in internal differentiation and inequality in growth. They invested heavily in the Costa Rican coffee industry, becoming the principal customer for exports until
World War II. This led to the establishment of the Anglo-Costa Rican Bank in 1863, which provided finance to allow the industry to grow. Growers and traders of the coffee industry transformed the Costa Rican economy, and contributed to modernization in the country, which provided funding for young aspiring academics to study in Europe. The revenue generated by the coffee industry in Costa Rica funded the first railroads linking the country to the Atlantic Coast in 1890, the “Ferrocarril al Atlántico”. The
National Theater itself in San José is a product of the first coffee farmers in the country. In 1955 an
export tax was placed on Costa Rican coffee. The current export tax is levied at 1.5%. In 1983, a major blight struck the coffee industry in the country, throwing the industry into a crisis that coincided with falling market prices; world coffee prices plummeted around 40% after the collapse of the world quota cartel system. By the late 1980s and early 1990s, coffee production had increased, from 158,000 tons in 1988 to 168,000 in 1992, but prices had fallen, from $316 million in 1988 to $266 million in 1992. ==Production==