The stagnation of the refinery project could be the reason for China's loss of interest in Costa Rica, after having stopped the disbursement of a $24 million "freebie", the purchase of $1 billion worth of Costa Rican bonds, the development of an industrial pole, and the extension of a road.
EDITORIAL
The diplomatic shift from Costa Rica which privileged mainland China over Taiwan - in contrast to all of its Central American neighbors- held the promise of an injection of Chinese investment and development in the country, in public infrastructure, energy, and manufacturing centers.
The government is waiting for more technical studies and analyzing the effects it would have on local production if entry of goods and services from Chile, Peru, Mexico and Colombia were fully liberalized .
Although the previous Chinchilla administration had taken firm steps to join the trade bloc, the current President Solis, has cooled down the process, which in order to continue must wait for the Ministry of Foreign Trade to complete further studies on commercial sensitivity, and later present them for public consultation.
Citing the old concepts of food sovereignty, protection is being given to the inefficient production of the few while the consumption capacity of the poorest is punished.
EDITORIAL
As expected, the government of Luis Guillermo Solís has decided to apply the safeguard measure requested by rice farmers, increasing the tax paid on imports of milled rice from 35% to 62%, which in practice only applies to rice bought in Argentina and Uruguay.
Once again conservationism is at the service of sectoral interests, paralyzing investment in infrastructure which is essential for halting the deteriorating competitiveness of the economy.
EDITORIAL
In Costa Rica an investment of billions of dollars to build a container port has been held up by six years of legal proceedings, and added to this will be a further 5 months due to maneuvers made by uncompromising conservationists in league with unionists.
The complaints made by industrialists revolve around informal trade, the fight against smuggling, competitiveness and innovation.
From a statement issued by the Chamber of Commerce of Costa Rica:
At a meeting between the President of the Republic, Luis Guillermo Solís, and representatives of the Chamber of Commerce of Costa Rica several concrete proposals were presented to the Government in four priority areas for the work of the organization, in order to start work together.
Starting October the private sector and government will be working together to implement measures to improve the competitiveness and productivity of the economy.
From a statement issued by the Costa Rican Union of Chambers and Associations of Private Business Sector (UCCAEP):
The Costa Rican Union of Chambers and Associations of Private Enterprises (UCCAEP) and the Executive have agreed to the formation of a council to facilitate the coordination and monitoring of public policies on competitiveness, innovation and employment.
The academic corporatism which has come to power in Costa Rica brings a "vision of the world of the Social Democrats of the sixties and seventies."
An analysis carried out by Juan Carlos Hidalgo on his blog on Elfinancierocr.com on the proposed Costa Rican state budget points to a decalogue of macroeconomic horrors that besides contradicting election promises on cost containment and austerity, show an outdated vision of the new government regarding the alleged benefits of increased public spending in the functioning of a modern economy.
The initiative for a National Strategy for Employment and Production created by the new Solís administration shows that there is still a belief that public officials know how to produce wealth.
EDITORIAL
The Costa Rica entrepreneurs' opinion is convincing: the Union of Chambers states that "employment is not generated by decree, but through policies which improve the business climate" ...
The productive private sector is signalling a lack of dialogue and clarity as well as conflicting messages from the authorities of the new Costa Rican government, which is also proposing laws that discourage investment.
An increase of more than 4% in the salaries of public officials, lack of action over lowering the cost of energy, lifting barriers which generate legal uncertainty, and initiatives to increase the tax burden on the formal productive sectors are the issues concerning entrepreneurs in Costa Rica.
There are concerns related to lack of definition in key areas and the Solis administration's true implementation capacity is being questioned.
The guild of private companies has also criticized the fact that they were not included in the development of the employment strategy to be presented in the next few days by President Solis.
For example, on the subject of electricity tariffs, Mario Montero, vice president of the Costa Rican Chamber of the Food Industry (Cacia), told Crhoy.com that "... 'there are now too many diagnoses and there are issues where political calculations should be left out of the picture, and the industry wants to participate in working groups' ... 'inaction is choking us and postponing decisions for 18 or 24 months is not acceptable.' "
The state run electricity company intends to archive projects in the energy reform sector, while the commission presided over by president Solis is going to take 18 months, just to discuss the country's energy matrix.
After the Solis government having announced the creation of a commission that will take a year and a half just to diagnose the problems of the energy sector in the country, the Instituto Costarricense de Electricidad has made a request for three projects on law reforms being studied in the Legislature, to be archived while the commission seeks these solutions.
The center-right presidential candidate in Costa Rica says he would mantain the extension on the liberation of rice prices.
The presidential candidate of the Citizen Action Party, Luis Guillermo Solis said that a new government would keep the six month extension that has been ordered on the liberation of the price of rice.
"... The Executive deferred the measure until 1 March 2015 after talking with the sector.