His government also concentrated on and promoted the country's petrochemical industry and even began exploration and digging near the Talamanca Mountain Ridge in search for petroleum.

On the international front, Carazo had to deal mainly with the radical changes in the neighboring country of Nicaragua, which had been under the control of the Somoza dictatorship for decades, whose rule Costa Rica had always opposed.

The government also started planning for the creation of a defence force to fight off any Somoza attempt to attack Costa Rican territory.

The government received a strong backlash from the public, and the opposition claimed that Carazo had failed to protect Costa Rica's sovereignty.

Furthermore, Carazo's government allowed three US helicopters to touch down on national soil to facilitate Somoza's escape from Nicaragua.

Against the advice of his Minister of Finance, Hernán Sáenz Jiménez, and the International Monetary Fund (IMF), Carazo instructed the Central Bank of Costa Rica to borrow heavily to maintain the value of the colón, the local currency, in the hope that an economic recovery was close at hand.

The heavy load of debt that the central bank acquired contributed to the highest rates of inflation that Costa Rica has endured ever since.

[4] He was survived by his wife, former First Lady Estrella Zeledón Lizano, and four of their five children: Rodrigo Alberto, Mario Ernesto, Jorge Manuel and Álvaro.