Caribbean & Central America - 16 November 2004
COSTA RICA: Scandals hit the PLN
Costa Rica's largest opposition party, the Partido Liberal Nacional (PLN), is coming to terms with its own public disgrace. The party's hope that the scandals convulsing the ruling Partido Unidad Social Cristiano (PUSC) would boost its standing among the electorate has been dented by accusations levelled at one of the PLN's, and Costa Rica's, former presidents: José María Figueres. On 27 October Figueres admitted receiving US$900,000 from Alcatel, the French telecoms giant at the centre of the scandal that brought down Miguel Angel Rodríguez from his post as secretary-general of the Organization of American States (OAS) to his current position in a cell-block of a San José prison.
Figueres maintains that he did nothing wrong. He claims he earned the money legitimately from 2000-2003 through offering advice on the telecoms industry to H.F. Desarrollos Interdisciplinarios and that he had no idea that this company was contracted by Alcatel. Currently residing in Switzerland, where until these recent revelations he worked as managing director of the World Economic Forum, Figueres gave an interview with Le Temps newspaper on 29 October in which he expressed his willingness to hand over all his bank details to the appropriate authorities. Although he has been forced to quit his job, he has made no mention of returning to Costa Rica, as both his supporters and detractors would like him to do, in order to explain himself. There is no chance that he will be forced to do so either: Costa Rica has no extradition treaty with Switzerland.
In order to appear tough on corruption, the PLN immediately expelled Figueres from the party. The writing was on the wall for Figueres when the party's leader, former president and Nobel peace prize winner Oscar Arias Sanchez, described his actions as 'a betrayal of the ideals and inheritance of Don Pepe [José María Figueres Ferrer]'. 'Don Pepe', the father of Figueres, defeated the father of Rafael Angel Calderón (another former president currently imprisoned on corruption charges) following the civil war of 1948 and later became one of Costa Rica's most influential leaders, as head of the founding junta of the Second Republic of Costa Rica.
On 12 November four PLN members resigned rather than face the party's 'ethical tribunal'. Former general secretary Carmen Valverde, ex-head of the state telecoms firm ICE, Joaquín Fernández, ex-minister Mario Carvajal and businessman José Antonio Herrero quit following allegations of corruption.
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ECONOMIC OVERVIEW: COSTA RICA
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Moody's credit rating agency reaffirmed its Ba1 rating for the country's bonds at the beginning of November. Moody's adds that its rating has a negative outlook. Moody's has held this gloomy view of the country's prospects since April 2003. The government tried to put a positive spin on the rating. The finance minister, Federico Carrillo, said that the review was positive because the government had expected the rating to be downgraded because of its failure to make progress on fiscal reform. The fiscal reform has been stuck in congress for the past two years. Outlook Inflation: Inflation in October was 0.75%, bringing the rate for the first 10 months of 2004 to 10.34%. In the same period of 2003, the rate had been 6.9%. The government will not achieve its inflation target of 10% for the year. Besides fuel and transport prices, food prices rose strongly in October. The price of beans was up by 14%. |