by Rod Hughes

Costa Ricans feel that next year will be hard economically but half of those answering a Demoscopia poll made for the daily newspaper Al Dia do not feel that their own standard of living will change much. A hair over 50% could foresee little change but 32% said they expected the worst.

Few had any illusions about the effect the world´s economic downturn would have on the country as a whole. A trifle over three-quarters said it would be a bad year while only 18% kept their optimism up for 2009. And with the holidays nearly upon us, as Al Dia notes, the poll struck a harsh note for retailers. Some 81% said it was a bad time to buy things as contracted with the 55% who responded to the question the same way last year.

But Costa Ricans generally maintained some optimism. Nearly 68% expect economic conditions to grow better. Even in the area of crime, one of the chief concerns for the past several years, some 65% expected citizens would be safer next year.

by Rod Hughes

A bill to pardon hardship cases of those who contracted public housing but have fallen far behind in their payments has passed its first reading in the the Legislative Assembly. The current law stipulates that those who do not pay back the extremely soft loans of public housing within 20 years will face foreclosure and, indeed, some legal processes are already in court.

In the 1980s, the Banhvi housing bank was created and Costa Rica, faced with a housing shortage and a population of workers who could not muster the down payments to own their own homes, began an ambitious public housing program that has continued into the present time. The presentation of housing “bonds” became a nearly monthly ceremony.

Many of the original mortgage contractors have disappeared but the debts incurred to BANHVI have lived on. At least 2,100 families were in danger of losing their shelter. Some, who had contracted their homes with such now defunct entities such as Banco Anglo or Mutual Guanacaste, had not idea whom to pay. Others suffered hard luck, such as incapacity of the breadwinner.

In many cases, the legal costs of foreclosure would be larger than anything the bank could recoup. The original debts were incurred in inflation-eroded colones and the tiny houses themselves are in most cases sadly deteriorated. The 35 votes for the bill underscores the general approval the lawmakers felt.

by Rod Hughes

Saprissa regained the lead in its group of First Division soccer Wednesday in a 2-1 defeat of Puntarenas. Ironically, one of its goals was by veteran Ronald Gomez (with an assist by Michael Barrantes) who is scheduled to leave the club when his contract runs out next month. Moreover, he also made the pass to Jairo Arrieta who scored the second, winning marker.

The big purple “S” is weeding out some of its veterans to make way for new blood, not without some misgiving of its fans. Gomez substituted for Alejandro Alpizar at minute 17 after the latter was injured. But Gomez, nicknamed “La Bala,” (the bullet) has been around for a long time and, for the past year, it has been mainly warming the bench. And he isn’t the only veteran being shown the door.

Try Bennett is already gone and goalie Jose Francisco Porras will go early next year at the expiration of his contract. As for Gomez, he will be 34 in January and may not be picked up by any top-level club. But he looked stylish Wednesday as he evaded the expert guard of Kurt Bernard to make his goal against Puntarenas.

Saprissa has a strong Second Division team, which the club uses as a “farm team” to develop talent for the big time–indeed, it was one of the first clubs in Costa Rican soccer to do so.

>by Rod Hughes
(From La Nacion)

Spanish operatic tenor Placido Domingo arrived this morning at 4:28 a.m. in Costa Rica for a concert. After disembarking at Juan Santamaria International Airport in Alajuela from a private jet owned by Banco de Costa Rica, one of his concert’s sponsors, he was whisked away to his hotel, surrounded by National Security agents as if he were a visiting president.

It was Domingo’s first visit to this country and, although his schedule does not include a tour of the country, he asked his escort if there were any beaches nearby. He had taken off from Washington D.C. where he had just finished directing the orchestra for a performance of the opera Lucrecia Borgia.

Senior Citizens Get Own Party for 2010

Senior citizens will get their own political voice in the 2010 national elections and, if the Partido Alianza Mayor (PAM) should win a seat in the Legislative Assembly, a lawmaker to push through legislation to benefit residents over 65 years old. The movement’s president, Jose Miguel Abarca, is only 31, however.

The group’s hope is that it will enjoy the same success as when Oscar Lopez, confined to a wheelchair, won a seat among the lawmakers in 2006, representing the physically handicapped. His party is called in translation the Accessibility without Exclusion party and, with some backing of President Oscar Arias and his National Liberation party, has pushed through some legislation for the handicapped. (Sen. John McCain, do you want to broaden your horizons?)

Long Range Security Cameras to be Installed in Capital

With great fanfare, San Jose Mayor Johnny Araya announced the installation of 15 long range security cameras in the downtown capital to discourage crime. The new generation of video has higher definition and a range of 300 meters as well as 360-degree coverage when controlled by a central monitor. The idea, he said, was to cover 160 blocks of the city so that Municipal Police can respond to evil doers.

Security cameras are already installed in some areas but many doubt their real effectiveness compared with, for example, actual patrolmen pounding a beat. Last year, Tico Times editorial cartoonist Nestor Gonzalez depicted two criminals at work on a street, when one calls attention to the security camera. “Yeah,” responds the other, “we should steal that, too.”

Elections Tribunal Rejects Death Penalty Referendum Bid

The Supreme Elections Tribuna has flatly rejected a nationwide referendum on the death penalty. Costa Rica’s 1949 constitution forbids putting criminals to death, following a tradition begun in 1882 by then-President Tomas Guardia. A Guanacaste resident petitioned the tribunal for a vote on allowing those guilty of murder or sex crimes to be executed.

The election supervisory body ruled that constitutional changes can only be made if the Legislative Assembly first clears the way. Non-constitutional referendums, such as the one that ratified the Central American Free Trade Agreement, can be put to a vote by petition signed by 136,751 citizens over age 18.

by Rod Hughes

The Legislative Assembly’s coalition of 38 deputies voted “yay!” yesterday after the second reading of the final of 13 bills needed to bring Costa Rican laws into accord with provisions of the Central American Free Trade Agreement (CAFTA). Now the country is officially a member of the trade pact on which President Oscar Arias bet so much of his political capital.

The two-thirds majority consisting of the National Liberation, Social Christian Unity and Libertarian Movement contingents in the unicameral congress capped a tough battle and the longest political soap opera in recent memory. The Citizen Action Party (PAC) maintained its opposition to the end after fighting a year and a half rear guard campaign that often held up votes on other issues.

Granted, some housekeeping measures are still to be performed, but the titanic struggle is over and the Executive Branch has until Dec. 31 to accomplish them. Three regulations relating to foreign trade have to be signed by the President and various ministries, including Foreign Trade and the Environmental Ministry, have to reform some rules. No difficulties are expected but, where bureaucracy is concerned, one never knows.

The jubilation on the Assembly floor yesterday may have masked how close run the whole affair had been, with only a bare, delicate coalition of 38 votes staving off the nullification of the plebecite last November, Costa Rica’s first, that approved CAFTA by a narrow margin. PAC’s opposition to the trade pact had made itself felt so definitely that Arias had to plead for two extensions on the deadline to join the other nations.

The final bill to clear the way was one that had not been expected to be especially controversial: the copyright and trademark law. But after it had been passed, just before the first extension deadline was about to run out, a constitutional review of the Supreme court found that on one provision the lawmakers had illegally cut corners.

The other CAFTA member nations graciously granted another three months, a generous concession considering that all of them had quickly ratified the treaty, some within days after signing. In the U.S. Congress, the measure had gone through after little debate despite opposition of the Democrats who were then in the minority.

PAC and a couple of socialist allies mainly objected to two of the laws needed to implement the treaty: one freeing the country from the monopoly of the government insurance company INS and the other opening the telecommunications market and breaking the ICE monopoly over the Internet access. Ironically, they were not the last to be passed, due to the procedural error on the copyright law. But PAC’s obstructionism cost them a lawmaker who withdrew from the party since, she said, the people had spoken in the referendum.

Some observers, especially foreigners, were puzzled by PAC’s fierce opposition and the pro-CAFTA determination to pass it at the expense of often urgent legislation. The English-language weekly The Tico Times editorially scratched its head and said, essentially, “What’s all the hoopla about? It’s just a trade treaty…”

But that ignores the ideological struggle going on between PAC and the President. Arias had taken his left-of-center National Liberation party into the center, even, some dissident members complained, right of center. While traditionally the party had not been hostile to business, it had been definitely socialist. That left the doctrinaire PAC under Otton Solis to fill the vacuum on the left, a place on the political spectrum that would have been, in the 1950-80 era, occupied by a handful of communist lawmakers.

Leglislative Assembly rules do not admit filibustering but PAC used something against the 13 CAFTA laws a tactic nearly as effective. The party whips tried to strangle those bills in their cribs by proposing an avalanche of amendments. Whether this tactic will backfire on the party and its almost inevitable presidential candidate, Otton Solis, in the 2010 elections remains to be seen, but it will likely be an issue to be exploited by their adversaries.

by Rod Hughes

The Interamerican Highway south of Cartago will be closed Wednesday and Thursday to repair a cave-in produced by heavy rains. The damage is located at San Isidro de el Tejar in an area known as Cangrejo but alternate routes can be employed to circumnavigate the closure in order to reach the Southern Zone and the panama border.

Light vehicles departing from the Central Valley may use the Desamparados-Tarabaca-La Fila-Rio Conejo-Frailes-San Cristobal del Sur-La Sierra route to rejoin the main highway south. Another possibility for cars and pickups would be Desamparados-Tarbaca-La Fila-Rio Conejo-Frailes to Los Santos in the area known as El Empalme. Heavy cargo vehicles are advised to take the Costanera Highway.

The Ministry of Public Works and Transport that the exceptionally heavy rains that undermined the highway revealed the necessity to install a drainpipe under the highway at the cave-in site.

by Rod Hughes

The Mexican appliance manufacturer Mabe (pronounced Mah-bay) announced yesterday that it was laying off workers at its Heredia plant. Mabe acquired controlling interest in the Costa Rican Atlas company that made and sold appliances throughout the region last February. The firm did not say how many workers would be affected.

The Heredia plant turns out home appliances such as electric stoves, refrigerators, air conditioners and microwave ovens, employing 1,350 workers. Company spokesman Diego Artinano, blamed world economic uncertainty for a drop in sales that made the cutback necessary. Artinano added that the firm had to adjust its production to conform to a “perceptible contraction” in its export sales.

The announcement comes in stark contrast to another large manufacturer here, Intel. That company announced last month the launching of new products and investments in research in which this country plays a role. But, as a business writer for The Tico Times observed recently, Intel has never been a company to swim with the mainstream.

by Rod Hughes

The Arias Administration has decided to go through the Legislative Assembly to obtain extraordinary funding for the nation´s two largest state-owned banks. President Oscar Arias announced last week that he would use the budget surplus to inject $50 million each into the reserves of Banco de Costa Rica and Banco Nacional to loosen up credit.

The administration had at first contemplated releasing the funds by decree but legal advisors counseled that the Comptroller General’s Office, the budget watchdog agency, would declare that method illegal. The President felt some urgency in getting liquidity to the banks but Finance Minister Guillermo Zuniga told the daily newspaper La Nacion that he expected the special budget measure to speedily pass the Assembly.

He told the paper that the bill would be written Monday and Tuesday and signed today, ready to send over to the lawmakers Wednesday. His Deputy Minister for income, Jenny Phillips, will be the one actually carrying the draft since he leaves for a visit to Honduras Wednesday but promised to return in time to meet with the Financial Affairs Committee to explain the bill next week.

When Arias made his announcement of the credit loosening measure last week, businessmen heaved a long sigh of relief. Many businesses, especially the small ones, often carry on normal operations with borrowed funds. Some export firms complained that they could not fulfill current orders without loans, certainly a serious situation for the overall economy, which has suffered a worsening trade deficit since the beginning of the second trimester this year. Layoffs threatened and are being felt in construction trades.

The credit crunch could not have come at a worse time. The financial woes of the nation’s biggest trading partner, the United States, have affected not only that country’s purchasing of local goods but also worsened the trade climate worldwide, so that opening of alternative markets is increasingly difficult. It has also made negotiations with the European Union more laborious as this country seeks a free trade treaty with that market.

But despite continuing gloomy news from up north, this country finds itself in better shape than many countries in Latin America. First, in the last six years, it retired 43% of its foreign debt. Second, it finished last year with a budget surplus. The Central Bank also began the year with a healthy dollar reserve, enough to keep the country’s currency from being the plaything of money market speculators taking advantage of the unstable world financial climate.

The downside of using the budget surplus to prop up credit, is that it dashes hopes of using those funds next year for social programs. That fond hope earlier this year, coupled with low unemployment, raised hopes that the administration could lower the poverty level, a situation that showed encouraging improvement last year. Now prospects at even maintaining last year’s provery and unemployment levels are grim.

President Arias’s original plan did not include a third state bank, Banco Credito Agricola de Cartago, because close financial advisors deemed that bank sufficiently funded. A development bank, it receives funds already from the regular budget. However, Zuniga told La Nacion, that bank will receive a modest injection of extra funds as well. Wednesday’s edition of La Nacion reported that the administration has $17.5 million earmarked for that bank.

Meanwhile, the Central Bank intends to sell fewer dollars and, indeed, has cut back in the past four weeks. An important factor was the lessening of the drain of dollars due to the decline of world petroleum prices. The skyrocketing fuel price was the main villain in the worrisome trade balance figures earlier this year.

by Rod Hughes

President Oscar Arias’s approval improved markedly over his mid-year ratings, a Demoscopia poll published in today’s daily newspaper Al Dia indicates. Approval of his administration’s performance rose last month to 36.1% from 27.5% last July. The July figure showed a startling 17 point drop from grace earlier this year.

The polls showed a majority (43.1%) think Arias has handled things only so-so while nearly 20% were disenchanted with the government. Still, the poll was taken before the President moved boldly to loosen credit that businessmen complained was strangling the private sector. It may show that citizens are becoming aware that the government is not at fault in the global economic meltdown that is also effecting the nation and that, literally, things are tough all over.

The poll, taken between Oct. 20 and Nov. 2, indicates that Arias personally maintains a high regard in the eyes of his countrymen. Some 72% say they have no doubt he is a capable person and even slightly more told pollsters that he has a handle on what is going on in his country. More than half said they had confidence in the President and his cabinet, at 59%, a seven point rise from July.

Chinchilla Responds to Rival’s Accusation

Meanwhile, Arias’s former vice president and the person most observers think is his favorite to succeed him in office, Laura Chinchilla, challenged her rival for the National Liberation party nomination, Johnny Araya, to name the party members he says were pressured to support her. The San Jose mayor said last month that he had received complaints that central government officials were putting the thumbscrews on provincial Liberation officials to support Chinchilla.

Chinchilla, former Public Security minister, was an early favorite even before she resigned tne vice presidency to run for the presidential nomination in the 2010 national elections. Araya is her only credible rival, although former Security Minister Fernando Berrocal is also aspiring to the top spot on the ticket.

But Berrocal resigned under pressure or was fired (depending on the source of the story) from his cabinet post earlier this year after angering the President with an incautious statement in March. He said that he expected captured Colombian FARC guerrilla computer files to reveal that FARC influence had penetrated into the nation’s highest “political circles.” Subsequent questioning by a Legislative Assembly special investigating committee failed to reveal any confirmation of Berrocal’s claim.

by Rod Hughes

The First Division soccer standings tell it all–No one has a clear shot at the title in the first half of the 2008-9 season. Group B is tighter than a frozen muscle with Alajuela in the lead over Perez Zeledon by two points and Alajuela barely advancing due to its desperation 1-1 tie Sunday with an astounding University of Costa Rica. Of all people!

Meanwhile, Saprissa is in second place in Group A by a point under Brujas, despite Saprissa’s giving a convincing imitation of a machine gun in a 5-0 massacre of Liberia Sunday. Brujas is leading but the first three clubs are separated by three points. Group B is even tougher with the first four divided by four points.

Blood on the Turf: Saprissa 5, Liberia 0

Still smarting at being knocked out of the regional Concacaf “Champions’ League” tourney by Marathon of Honduras, the big purple “S” took it out on Guanacaste province’s capital. Liberia club owner Mario Sotela is probably wondering why his fat checkbook hasn’t bought him at least the group leadership after he bought the contracts of so many veterans during the off season. Jairo Arrieta scored first after only three minutes of play, follwed by Celso Borges.

But it was Armando Alonso who did the most damage, blasting in three big ones past stylish veteran goalie Alvaro Mesen. Al Dia sportswriters are wondering what steps entrepreneur Sotela, not the most patient of owners, will take to remedy the ailing club.

Alajuela 1, University of Costa Rica 1

Playing on its own home turf, Alajuela had to scramble for a desperation 1-1 tie with a resurgent UCR. Marvin Chinchilla scored for UCR after a bare two minutes and it was not until the mid-second half that Jean Carlos Solorzano managed to tie it up. And that was only on a penalty that fooled UCR goalie Alfonso Quesada, the only time that a ball got past him in an otherwise brilliant afternoon.

Heredia Edges Cartago 1-0 in a Ho-hummer

Slipping Heredia caught itself with a 1-0 victory over Cartago in a bright morning of yawn-provoking soccer that showed why neither side is a hot contender for the Champions’ League. Omar Brisceno finally scored at minute 41. Enough said.

Puntarenas Upsets San Ramon, 2-0

Puntarenas’s much-injured veteran Kurt Bernard celebrated his 100th First Division career goal late in the first half to give the home club’s fans something to cheer about. Ricardo Garcia added the insurance on Bernard’s pass.

Brujas in Group Lead with 4-2 Win over Carmelita

Brujas tromped Carmelita, everyone’s favorite to descend into the Second Division next year, in a match that revealed some problems in defense on the Brujas club. (While the leaders in both groups are up in the 20+ point area, Carmelita has but seven. That they managed two goals against Brujas is either a miracle or a lax defense.) Scoring for Brujas were Brenes, Gomez, Soto and Mora’s autogoal. For Carmelita, Cunningham and Vargas.

Perez Zeledon 2, San Carlos 1

Perez Zeledon has been having a marvelous early season and gives one hope that two clubs that are not Saprissa and Alajuela will play each other for the national championship. That’s what makes soccer the world’s number one sport. Maybe one of these years, Brazil will be knocked out of the first round of the World Cup. (It costs nothing to dream and in soccer, all things are possible.)

The southern club increased its prestige Sunday at the expense of San Ramon in a well-earned 2-1 victory. After 20 minutes of sparring, P-Z’s Colombian Luis Lara opened scoring at minute 20 and Juan Gabriel Guzman put victory out of reach in the second half with 2-0. Carlos Clark contributed a narrowing of the gap for the 2-1 count but the ‘Bulls of the North” were able to do no more against P-Z’s defense.