LN WEEKLY REVIEW

Costa Rica, Viernes 10 de octubre de 2008

/WEEKLY REVIEW

Weekly review

Financial crisis

There are no major economic symptoms of contamination in Costa Rica by the international financial crisis affecting world markets, said Central Bank chief executive Francisco Gutierrez. He explained that Costa Rica is little involved in the international securities market, that little stock is traded locally and that the capital resources of banks are healthy, However, he reckons that the country will suffer a deceleration of its exports, but that imports will also decrease as a result, partly, to the lower commodity prices and the smaller demand, resulting from economic restrictions.

Stock exchange

The Costa Rican stock exchange has not recorded major changes as a result of the turbulence affecting world finance markets. The stock exchange chief executive, Jose Brenes, asserted that no major effect has been felt locally. He explained that this is mostly because the local exchange particularly concentrates on fixed-yield securities (debt) and not shares, differently from most markets elsewhere.

15.77 percent inflation

The cumulate inflation in the last 12 months reached 15.77 percent. The prices of beans, rice, eggs, cooking oil and diesel all increased over 50 percent in the year from September 2007 to September 2008. Beans –which together with rice are basic and account for the largest part of the Costa Rican diet—recorded the highest increase: 70 percent, according to the National Statistics and Census Bureau (INEC in Spanish). In general, food has increased 28 percent and the most affected are poor families, who spent almost all of their income on food. Central Bank chief executive Francisco Gutierrez and other economists believe that in the coming months inflation will start decelerating, meaning that the increase in prices will continue, but at slower rate.

Airport management

Houston Airport System Development Company (HASDC) will take over as manager of Juan Santamaria International Airport as of next December. A member of the Houston Airport System corporation, one of the world’s largest in its area, HASDC must first pay around $90 million which the current manager, Alterra, owes banks. The U.S., Canadian, and Brazilian corporation, pledged to have the airport totally refurbished 12 months after taking over.

Vice-President resigns

Laura Chinchilla, 52, a political scientist and lawyer, resigned as Vice-President and Minister of Justice in order to join the 2010 presidential race. Because of the earlier resignation of the other vice president, Kevin Casas, in the case of an absence by President Oscar Arias, by law the office would go to Congress speaker Francisco Pacheco. Regarding Mrs. Chinchilla, Minister of Tourism Carlos Benavides said that she is a top-level politician, who has decision-making capabilities difficult to match in Costa Rica, and that a lot of people will support her aspirations.

$105 million for housing

Overseas Private Investment Corporation (OPIC), a US Government agency, granted $45 million to Bank Lafise Costa Rica and $60 million to BAC San Jose –both of which are private—for these firms to improve their mortgage portfolio through loans for houses destined to people of mid to low income. The loans will enjoy a low fixed interest rate and a 25-year term. The funds are supplied to the BAC on the condition that it grant loans for houses and for the benefit of small and medium firms who need to expand their activities. OPIC chief executive Robert Mosbacher said that these funds are granted as part of the Central America-Dominican Republic-United States Free Trade Agreement (CAFTA).

Chinese President

Congress speaker Francisco Pacheco confirmed that the President of the People’s Republic of China Ju Jintao will visit Costa Rica on November 17. It will be the first time ever that a President of that nation visits Costa Rica, which renewed its diplomatic ties with Beijing in June 2007.

Protection of turtles

The combined efforts of the Worldwide Wildlife Fund (WWF) and a group of volunteers known as the Baula Boys, 886 leatherback turtles were born from nine which came to nest at Junquillal Beach, Guanacaste, in the Costa Rican northwest Pacific. Before this event, no turtles were born at Junquillal because poachers took all of the eggs. The community and the WWF are promoting Junquillal as a wildlife refuge, and expect to enlist the help of the National System of Conservation Areas (SINAC in Spanish) to make the preserve come true.

Enhanced patrolling

In order to protect the vast marine wealth of the Costa Rican south Pacific, the environmentalist organization MarViva launched patrol operations off the Osa Peninsula. The non-profit private organization therefore reinforces the efforts of the National Coast Guard Service and the national park wardens of the Ministry of the Environment, Energy and Telecommunication, both of which ail of very limited resources. The patrols will improve control of the protected marine areas of the South Pacific, including Corcovado National Park, Ballena Marine National Park, and the Caño Island Biological Reserve.

Fugitive arrested

Dean Albert Clark, who was wanted by the FBI for a scam with vacation packs in California, was arrested at Manuel Antonio Beach, Quepos. According to the International Police, Clark and an associate had taken $146,000 which belonged to 46 patrons of the vacation deal they operated.

Amazon center

The world leader in Internet sales, Amazon, will establish in Heredia, Costa Rica, its first customer service center in Latin America. The manager for Costa Rica of the US electronic commerce giant, Alejandro Filloy, said that the center will handle the queries of US customers. He added that before making the decision to establish it here, the firm had thoroughly analyzed the conditions offered by other Latin American countries and by the United States to harbor the center, but that the Costa Rican ones finally prevailed.

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