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These stories were published on Tuesday, March 9, 2004, in Vol. 4, No. 48
Jo Stuart
About us
Community's heritage rooted deep in church
By Laureen Diephof
Special to A.M. Costa Rica

A man, his ox and cart delivered the church two stones at a time from Cartago 35 kms. away, according to local lore.

This is one of the stories passed down through generations, stories that surround the building of the century-old San Joaquin de Flores church in the outskirts of Heredia.

Once the stones were brought to the construction site, the story goes, they were bound together with a mixture of sand, limestone and egg whites.

This historical architectural treasure has given pride to the residents of San Joaquin de Flores, not only for its impressive size and beauty, but for the folklore that bridges the families of years ago with their descendants of today.

The gray stone church, adorned with huge wooden doors, sits solidly on firm ground, as it has for 116 years. Fourteen white Italian sculptures depicting the Stations of the Cross surround the church in the flower gardens, where you can find a place to sit and rest.

San Joaquin de Flores resident Oscar Ramirez, 94, remembers stories from his father and grandfather regarding the triumphs and trials of building the church through community effort. Citizens, Ramirez reports, rallied together to raise money for the church by selling food items at county fairs. Many families, some who became rich through coffee exporting, beginning around 1843, sponsored the construction through generous donations.

The iron gate and fence enveloping the church, donated by Lorenzo Barrantes, came from England. Maria Barrantes contributed the tower bells, and Juan Alfaro Murillo gave the property for the church, soccer field and cemetery. 

One of 14 sculptures depicting the suffering and death of Christ, here being taken down from the cross.

A.M. Costa Rica photos/Laureen Diephof
Built like a fortress two blocks at a time, the San Jaoquin de Flores Church ages well.

Spanish artist Jose Claro Azcarreta painted the walls and ceiling inside the church in 1954, and Joaquina Barrantes donated this work.

Prominent families presented 13 of the Italian sculptures. Their names are inscribed on their piece.  A group raised money for the 14th sculpture and presented it in honor of the builders. There have been some additions to the church in later years, and those were accomplished through the use of modern machinery and materials. The stained glass windows are original.

Every year, according to resident Onofre Hidalgo, the church features Holy Week with the story of Christ’s crucifixion, burial and resurrection acted out by parishioners. On Thursday, he said, of this year’s Holy Week beginning April 4, parishioners from nearby towns meet in the church for an all night prayer vigil. The next day the crucifixion and burial is portrayed through acting, at 11 a.m. and 3 p.m. Sunday, the resurrection will be celebrated in front of the church, with activities throughout the day.

The San Joaquin de Flores church proves to be the religious and social pivotal point for the community. That includes the soccer game in progress nearly everyday, all day, in the field adjoining the church.

The big stone church memorializes a community’s effort to mobilize their talents and hard work to accomplish a collective dream. Their efforts have been enjoyed for over a century. The landmark church is about 200 meters east of the San Joaquin de Flores post office and across the soccer field from the Estados Unidos School.

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Pacheco to sign pact
with Caribbean nations

By the A.M. Costa Rica staff

President Able Pacheco makes a quick half-day trip to Jamaica today to put his name on a trade treaty with the Caribbean community.

He will be accompanied by a trade delegation seeking to increase business there.

Pacheco will arrive in Kingston about 11 a.m. to meet with Percival Patterson, Jamaica’s prime minister and the president of the Caribbean Community of 14 nations.

The principal beneficiaries of the treaty will be agricultural interests in Costa Rica which will be able to export more plants, fruits and other produces, including boned chicken.

The treaty is an extension of an accord signed with Trinidad and Tobago in 2002 under which 94 percent of Costa Rican products enter that island nation free of duty.  Costa Rican trade officials said Monday that in the last three years the nation has shown an average increase of 24 percent in exportations to the region. Last year Costa Rica sold $70 million to the Caribbean nations, according to statistics from the Ministerio de Comercio Exterior.

In exchange, Costa Rica will import liquid gas, certain minerals and some industrial goods.

Pacheco is supposed to sign the agreement at noon and then jet back to Costa Rica by 3 p.m.

Villalobos creditor
will keep on fighting

Dear A.M. Costa Rica:

Apparently, you miss the point. We just wanted the story out to as many people as possible. . . and that it is via this TV show . . .  to millions of viewers. 

As far as sounding "whiny," I was one of those interviewed and know better than that. There was a group of us who are victims of a crime stating the facts:  that the Costa Rican government robbed us of pensions and life savings. They lied on that show (Guillermo [Hernández]) saying they (the government) never knew the Brothers had more than a money-changing business. And Nash (who was trying to get his father's money - without the permission of his father) used the show as a way of trying to make Villalobos look unethical - hmmmm, wonder if he had an agenda? Wasn't he written about extensively in the newspapers in Costa Rica ? Ha! 

The Brothers have been in and out of the news for years, the CR government and Sugef, etc. ALL were aware of the program and turned an eye, welcoming the revenue that many investors put back in the local economies. 

If you want to express your views, fine. However, it would be nice if you really took a less than biased view all the time. You tend to treat us (the investors) like a group of malcontents. We are victims of Costa Rican government greed. 

The show was very edited and in reality just left the question "will we ever know" as the final note. Yes, we will. We will fight in an international court. We did nothing wrong but invest in a country that was more than aware, actually that helped, seduce foreign investors WITHOUT protecting them. Even the show stated that all the RCMP asked for was help in getting the men they were pursuing. 

The CR government stole the funds and began using them before the investigation (another ha!) has even concluded. On a final note: rehash??? This is just the same CRIME that occurred to thousands of people, ruining many lives, and you act like we just don't want to let it die. 

Of course not. Then we would be the fools you all love to claim us to be. This investor is going to keep on fighting - in spite of the jealousy and spite and pettiness of many people not even involved - who just like to make judgments. 

Susan Raines 
New York
EDITOR’S NOTE; Ms. Raines is replying to the story Monday about a Canadian television show profiling the Luis Enrique and Oswaldo Villalobos Camacho high-interest investment operations that closed down Oct. 14, 2002.
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Many expats will not notice new value added tax
By the A.M. Costa Rica staff

A new value added tax working its way through the Costa Rican legislature will be mostly hidden from foreign residents here. For many, the effect will be about the same as the current 13 per cent sales tax.

One exception will be the plan to tax residential rents at 6 percent. Residential rents are not taxed now. The plan calls for taxing rents that are more than about $390 a month.

The value added tax is a concept being pushed at the international level by a number of organizations, including the Organisation for Economic Co-operation and Development. Only the United States of the organization’s 30 first-world members does not have a value added tax.

The rate here on most products will be 13 percent. The highest such tax, based on the most recent available statistics is 25 percent in Sweden, Hungary and Denmark to a low of 5 percent in Japan.

Under the Costa Rican proposal, certain basic foodstuffs, public transportation, private education and events like soccer games will be exempt from taxation. This is an effort to offset one of the disadvantages of the value added tax: that it is regressive and has a greater impact among the less well-off who spend most of their income for goods and services. The rich invest much of their income, and banking services would be exempt under the Costa Rican proposal.

Another disadvantage of value added taxes worldwide is the great temptations that nations have to raise the rate once the tax is on the books.

Said columnist Bruce Bartlett of the conservative National Center for Policy Analysis in the United States in a 2002 report:

"It has proven too easy for governments to piggyback on inflation and raise VAT rates as prices were rising anyway. People did not notice the tax increases because they were hidden in the prices of goods and services. Consequently, the VAT proved to be a massive money machine that fueled a vast increase in taxation in every country that has adopted it."

The exact nature of the value added tax will not be known until and if the Asamblea Nacional passes the measure. Amendments are still possible to the nearly 500-page tax package. However, estimates are that the value added tax will raise an additional $500 million a year.

In general, value added taxes extract money from goods as they move from raw materials to finished product. At every step in the chain a tax is levied on the increase in value. A timber salesman would pay a tax on the value of the wood sold to a 

Paperwork will be more complex

carpenter. The carpenter would pay a tax based on the difference between what he paid for the wood and the money a distributor pays him for the furniture he makes. The distributor would pay a tax on the difference between what he paid for the furniture and his selling price. The retail purchaser would pay all these taxes in the increased price paid for the furniture.

With all the taxes being levied at every stage of production, another well-documented disadvantage of a value added tax is the amount of paperwork businesses have to keep. The Costa Rican tax authorities are paperwork crazy as it is, but to actually determine the amount of "value added" is a tricky accounting problem.

In addition, the actual tax burden on any product will vary based on how many hands it passes through on the way to market.

There also is a danger that the retail customer will be paying tax on taxes.

The Internet is a challenge to the value added tax. Certain music and software can be downloaded directly by computer regardless of the location of the sending computer. European governments have been trying to figure out a way to charge tax on such transactions that have their origin in the United States. But there is no way for the Europeans to force companies to collect tax when the companies have no physical presence when they are making the sale.

A distinct advantage to a value added tax will be that exports are shipped out tax-free. That is an encouragement for exportation.

Costa Rican lawmakers have a much more pressing reason for passing the value added tax. The current budget is more than 50 percent borrowed money. In order to continue the kind of social welfare state most Costa Ricans accept, the government needs to generate more income.

In addition to a value added tax, the package in the legislature taxes casinos, offshore betting enterprises, luxury vehicles, offshore banks and corporate and individual income.

Aristide calls for resistence to invading forces
By the A.M. Costa Rica wire services

Ousted Haitian president Jean-Bertrand Aristide insisted Monday he is still the leader of Haiti, and called for peaceful resistance against what he described as occupation of his homeland. 

One week after arriving in Bangui, Central African Republic, Aristide called on Haitians to peacefully resist the foreign occupation of their homeland.

He spoke at a news conference in Bangui at which he repeated statements aired earlier in the day on RTL French radio. He said in both he is still the elected president of Haiti, and called for the restoration of democracy in his country. 

His lawyer, Gilbert Collard, said earlier the exiled Haitian leader was not free to move or speak publicly. He said Aristide has been held as a 

prisoner at a villa on the grounds of the 
presidential palace in Bangui and is not allowed to leave the grounds or talk with anyone.

The lawyer also said Aristide continues to insist that he did not step down as president of Haiti. He said that Aristide did not resign, but only gave a note stating that, if his departure would avoid a bloodbath then he was willing to leave, but that he did not intend to hand power to a foreign force.

The lawyer said Aristide intends to return to Haiti and to the presidential palace.  It is unclear whether Aristide will be allowed to remain in the Central African Republic permanently. 

The United States denies that Aristide was removed by force.  U.S. troops invaded Haiti in 1994 to restore Aristide to the presidency after a coup.

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U.S., Dominican Republic ready to wrap up pact
Special to A.M. Costa Rica 

WASHINGTON, D.C. — The third and final round of negotiations aimed at integrating the Dominican Republic into the U.S.-Central American Free Trade Agreement (CAFTA) began here Monday.

The trade talks with the Dominican Republic were launched in that country's capital city of Santo Domingo in January, and a subsequent round of negotiations in San Juan, Puerto Rico, followed in February.

U.S. and Dominican officials hope to conclude negotiations this week to add the Dominican Republic to the free trade accord reached between the United States and the Central American nations of Costa Rica, El Salvador, Guatemala, Honduras, and Nicaragua.

Speaking to the U.S. Chamber of Commerce in Washington Monday Assistant U.S. Trade Representative Regina Vargo said that the integration of the Dominican Republic into the trade pact will allow all nations involved to build on already "quite considerable" commercial relationships.

Vargo noted that U.S. trade with the free-trade countries and the Dominican Republic is currently $8.7 billion annually, representing the United States' second-largest market in Latin America after Mexico. The conclusion of the current talks, she said, should expand these trade ties.

"We expect CAFTA to offer significant opportunities for the United States and the Dominican Republic to grow and deepen this relationship," Vargo said.

Beyond bolstering trade ties, she said, the accord reached between the United States and the Dominican Republic will aim to ease poverty, foster development, and strengthen democracy and the rule of law in the Caribbean nation. To further these ends, Vargo added, the United States seeks a comprehensive accord with the Dominican Republic that includes what she described as "state-of-the-art" rules and "21st-century" disciplines.

As she outlined the course of the current bilateral talks, Vargo said that one recurring theme has been regulatory transparency. She explained that the free trade treaty has "particularly strong" anti-corruption provisions and is the first trade agreement to criminalize the bribery of government officials in matters relating to international trade and investment.

Vargo pointed to textile and apparel issues as among the "handful or less" of issues that U.S. and Dominican trade officials will have to work through this week in Washington. 

Dominican Secretary of Industry and Commerce Sonia Guzman Monday that she is "very pleased" with the dynamic of the talks and "very optimistic" that an agreement will be reached.

U.S. beefs up Treasury's efforts against terrorist financing 
Special to A.M. Costa Rica

WASHINGTON, D.C. — The U.S. Department of the Treasury has announced creation of a new office to coordinate efforts to stop the flow of money to terrorists.

The department said Monday that its Office of Terrorism and Financial Intelligence will lead the efforts to cut the lines of financial support to international terrorists, a critical component of the Bush administration's overall effort to keep the United States safe from terrorist plots.

Treasury said the office will be led by a new under secretary and two assistant secretaries, and will coordinate the activities of the department's Executive Office of Terrorist Financing and Financial Crimes, the Financial Crimes Enforcement

Network and the Office of Foreign Assets Control.

"The new office will not only focus on the financial war on terror, but also protect the integrity of the financial system, fight financial crime, enforce economic sanctions against rogue nations and assist in the ongoing hunt for Iraqi assets," the department said.

The new posts would require nomination by President Bush and confirmation by the Senate.

In the Western Hemisphere, the Bush administration has designated a handful of rebel groups in Colombia and Perú as terrorist organizations. Therefore, anyone dealing with those groups or accepting money for transfer would be considered involved in terrorism by U.S. officials. 

Spanish firm buys out BellSouth's Latin American holdings
By the A.M. Costa Rica wire services

Spain's telecommunications giant Telefonica has purchased the Latin American assets of U.S.-based BellSouth to become the leading mobile phone company in Latin America. 

The $5.85 billion cash and assumed debt deal will give Telefonica another 10.5 million subscribers in 10 nations. 

BellSouth's holdings span the continent from Guatemala to Chile, with the main units in Venezuela, Colombia and Argentina.  The sale was made public Monday, and analysts say it allows BellSouth to better focus on the rapidly changing U.S. domestic market. 

The deal still needs government approval and is expected to be completed by the second half of this year. 

Jo Stuart
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