During the 18th Century the country finally began to produce some agricultural surplus, enough to maintain trade with Nicaragua, Panama and Cartagena, Colombia. Exports of wheat, tobacco and mules put the economy on a sounder basis, encouraging population growth and more intensive settlement, especially across the Central Valley region. A more urban culture began to develop as settlers migrated from dispersed rural communities to re-settle near churches and commercial centers. In 1717 the town of Heredia was established, followed by San Jose in 1737, Alajuela in 1782 and Escazú in 1793. San Jose, particularly, prospered from trade in both tobacco and mules, becoming the agrarian capital.
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By the beginning of the 19th Century, just prior to Independence, the overwhelming majority of Costa Rica’s 60,000 people resided in the Central Valley, which had become firmly established as the social and political center.
The economy was still driven by a largely egalitarian, peasant farming population; although a small merchant elite had developed in conjunction with the export industry.
However, despite economic and social development, Costa Rica still remained so remote from Central America’s political and commercial centers as to be practically self-governing. Although the country’s leadership was aware of the independence movement in neighboring colonies, they had not been actively involved and were somewhat surprised to hear that independence from Spain had been declared in Guatemala on 15th September, 1821. In fact, such was Costa Rica’s isolation that the news took almost a month to arrive!
At the moment of independence, the country’s political organization consisted of a fragmented sovereignty dispersed through separate town councils, giving each of the four major towns significant, regional power. Each had distinct ideas about how to meet the challenges of this newly independent society, and all claimed equal right to be the capital city.
The conservative and aristocratic towns of Cartago and Heredia favored accession to the Mexican Empire, while the more progressive liberals of San Jose and Alajuela preferred to become part of federalist attempts to unite the states of Central America. This initiated a period of conflict and unrest, resulting in a series of skirmishes over the next twenty years. In 1823, after a battle in the Ochomongo Hills near Cartago, the republicans were victorious and San Jose was declared the capital. Mexico was rejected and Costa Rica joined the Republic of Central America, participating in this ‘federalist experiment’ until its collapse in 1840.
San Jose’s right to power was again questioned in 1835, when the ‘War of the League’ broke out, and all three cities attacked it. However the Republicans emerged victorious for a second time, confirming San Jose as the seat of government and liberalism as the prevalent ideology.
Costa Rica’s great achievement of this time was its diplomatic success in avoiding involvement in the horrendous civil wars dominating the region, where the forces of conservatism linked to the Catholic church were pitted against the liberalism, entrepreneurs and free trade of the ‘new world’.
In Costa Rica, where religious institutions had never been particularly strong or influential, and whose largely rural, agrarian economy had prevented the growth of a bureaucratic conservative elite, liberalism easily took hold.
Rather than turning to war and repression, Costa Rica was able to concentrate on economic expansion, taking advantage of the new opportunities offered by independence; free trade, foreign investment and a wealth of new markets; to propel the economy out of its early poverty.
In 1824 Juan Mora Fernández was elected the country’s first Chief of State. He established a sound judicial system, founded the nation’s first newspaper and expanded public education. He promoted commerce and industry by offering rewards to anyone who would open up roads and ports and encouraged coffee production, giving land grants to small farmers to grow beans and encouraging larger landowners to establish processing plants.
Braulio Carrillo took power as a ‘benevolent dictator’ after the War of the League in 1835. He imposed measures to re-establish national unity after the disagreements of the previous years, establishing an orderly public administration system and replacing antiquated Spanish laws. He also promoted the coffee industry, exempting growers from tithes and giving free plants to would-be producers.
In 1838, with the Federal Republic of Central America still little more than a name, he declared Costa Rica a ‘Sovereign State’, although it would not become a Republic in its own right until 1848, when it was clear that the Central American enterprise had failed.