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(506) 223-1327        Published Wednesday, June 28, 2006, in Vol. 6, No. 127        E-mail us    
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Photos courtesy of Sharkwater Productions
Critical moment when Varadero 1 sideswipes the much larger Ocean Warrior
'Fugitive'  Watson says trial was news to him
By the A.M. Cost Rica staff

Environmental activist Paul Watson said Tuesday that he had no knowledge of a trial starting last Monday in San José where he was supposed to appear as a defendant.

He also said that he has no lawyer in Costa Rica and that he thought that the incident was long behind him.

A judge in the Tribunal de Juicio in San José declared him a fugitive Tuesday and issued an international arrest order. Watson, the driving force behind the Sea Shepherd Conservation Society, was to face a charge stemming from a seagoing dispute with a Costa Rican fishing crew in April 2002. He is charged with endangering the craft to the point of almost sinking her.

The case is unusual because an independent documentary filmmaker photographed the confrontation with the Costa Rican crew believed to be fishing illegally for sharks and then taking only their fins.

The case also is unusual because both Watson and the filmmaker, Rob Stewart, said in separate telephone interviews Tuesday that the incident leading to the criminal charges took place in Guatemalan waters. The Poder Judicial said in a summary of the case that the incident took place near the Isla de Coco in Costa Rican waters. The case rests on the allegation that Watson on the steel, 657-ton Ocean Warrior caused the much smaller and wooden  Varadero 1 to lose control and cause a collision.

"We would have cut them in half," Watson said by phone from Los Angles, Calif. as he dismissed the possibility that he deliberately ran into the Costa Rican boat.

Watson is backed up by Stewart's film, "Sharkwater," which will debut next April. The confrontation with the Costa Rican boat is a significant part of the film, Stewart said Tuesday from Toronto, Canada, as he basically supported the recollections of Watson.

Stewart also said that he had not been contacted by prosecutors in Costa Rica. The raw footage was shown to two prosecutors and two judges at the time of the incident in April 2002, Watson said. Both said there was insufficient evidence for a trial, Watson said, but he left Costa Rica then because he was told he would be thrown into jail for a year for investigation. He posted a bail amounting to $800.

A glimpse of the seagoing confrontation is even available by Internet from the Web site of Stewart's company, Sharkwater Productions. The film clip shows a minor collision between the side of the towering Ocean Warrior and the much smaller

Costa Rican boat on homeward course

Varadero 1.  The smaller boat then pulls away with no visible damage.    

Viewers can also see streams from water cannons that Watson's crew used to attempt to flood the engines of the Costa Rican craft. Watson and his crew were trying to bring the smaller craft into the Guatemalan port of San José so the Costa Rican fishermen would face charges of illegal fishing.

The Poder Judicial said that the Varadero 1 and its crew of eight were in international waters and adrift because of engine problems. Stewart said the position of the boat was fixed with GPS devices.

Both Watson and Stewart said that Ocean Warrior had contacted Guatemala authorities who asked that the Costa Rican craft be brought in so the crew could face charges.

The Poder Judicial said specifically that the use of streams of water caused the Costa Rican crew to lose control and collide with Ocean Warrior. It also said that the collision caused grave damages to the boat and physical damages to the crew members. The penalty upon conviction is six to 15 years.

Both Watson and Stewart said they believed that the case is influenced strongly by the shark-finning industry based in Puntarenas. Sharkfin soup is a delicacy in Asia.

Watson and his vessel were on the way to the Isla de Coco with equipment and supplies for a Sea Shepherd team that was working with park rangers there. He said if the incident happened anywhere near the Isla de Coco he would have called on Costa Rican park rangers to assist.

Sharkfinning is illegal in Costa Rica. However, the Taiwanese government has great political influence here and the practice continues with Puntarenas as the commercial hub. Environmentalist are appalled that a shark would be killed for just its fin.

Watson is Canadian with U.S. residency, and his organization is based in Friday Harbor, Wash.  Watson published a book in 1994, "Ocean Warrior: My Battle to End the Illegal Slaughter on the High Seas." He has campaigned against whaling, the slaughter of harp seals and other actions endangering marine animals. Watson said he would be sailing soon to protect whales from the Japanese fishing fleet.


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San José, Costa Rica, Wednesday, June 28, 2006, Vol. 6, No. 127


Costa Rica Expertise
Costa Rica Expertise Ltd http://crexpertise.com E-mail info@crexpertise.com Tel:506-256-8585 Fax:506-256-7575
 


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Man continues standoff
but without hostages


By Saray Ramírez Vindas
of the A.M. Costa Rica staff

A U.S. expat held his family at gunpoint in Bello Horizonte, Escazú, Tuesday night to demand morphine for his terminal illness. He eventually let them go but the situation still was a standoff early today.

The man was identified by the Fuerza Pública in Escazú as Michael Lewick, 42. He lives in Risco de Guacamaya. The man has a 9-mm. pistol and a 12-gauge shotgun, police said.

The man is angry because the Caja Costarricense de Seguros Social has no morphine to control the pain of his advanced cancer, police said.

A police officer said he thought alcohol was involved in the incident. Police surrounded the house under the command of Roy Segura, police said.

Four persons who were held are a daughter, 13, a domestic employee. a guest identified as Wayne, 59, and Lewick's wife, Patricia Jiménez Rodríguez. They eventually were allowed to leave the home, but the man did not. Negotiators from the Judicial Investigating Organization were on the scene.

U.S. Latin American expert
to visit students here


By the A.M. Costa Rica staff

A U.S. State Department official best known for describing ferment in the Americas as a battle of ideas, will be in Los Yoses to promote his thoughts with Costa Rican English-language students. He is Thomas A. Shannon, Jr., assistant secretary of State for Western Hemisphere affairs. Shannon also was a special assistant to President George Bush.

Shannon is in town to meet with legislative leaders and President Óscar Arias Sánchez to give a little boost to the free trade treaty with the United States that is languishing in the Asamblea Legislativa. He also certainly will be sounding out his hosts on their reactions to the  visit by the Venezuelan foreign minister last week.

Shannon will speak to the students about U.S. relations with Latin American with an emphasis on Costa Rica, said a release from the U.S. Embassy. He also will field questions, the release said. The event will be in the Centro Cultural Costarricense Norteamericano at about 3 p.m.

Shannon is a career diplomat who has reflected in public talks on what he calls the competing visions for the Americas. He contrasts open societies versus those with central control, like Cuba. Central control is also a direction that Hugo Chávez, the president of Venezuela is taking his county and where he would like to lead others, and Shannon is an expert on Venezuela.

"How these competing visions shake out" will depend on which vision shows it can deliver the goods in improving the lives of the 800 million people of the Western Hemisphere, Shannon said in a speech in May. He holds a doctorate from Oxford in political science.

He also has been in the forefront of U.S. efforts to keep  Daniel Ortega, the Sandinista. from becoming president of Nicaragua later this year.

Sustainable development
group will meet here


By the A.M. Costa Rica staff

The council of directors of an international sustainable development group will be meeting in San José starting Monday. It is COM+, Alliance of Communicators for Sustainable Development.

The first session will be opened by Bruno Stagno, the Costa Rican foreign mininster. Com+ says it is a partnership of international organizations and communications professionals from diverse sectors committed to using communications to advance a vision of sustainable development that integrates its three pillars: economic, social and environmental.

It is an initiative of the World Conservation Union. Meetings will be at the Hotel Costa Rica Marriott in Belén.

Moody rating service
gives nation a boost

By the A.M. Costa Rica staff

Moody's Investor Services has changed its mind about Costa Rica and now rates the country as stable instead of negative.

The company issues ratings that reflect the interest rates foreign investors demand for government and commercial bonds all over the world.

Moody's said that the country's debt ratio had improved.  The ratio is the amount of what a country owes compared to its gross domestic product or what it produces.

Costa Rica's internal and external debt continues to grow, but so does its major exports. The Moody rating also probably reflects international investors confidence in Óscar Arias Sánchez, the new president.

Day for collectors of coins

By the A.M. Costa Rica staff

Sunday is the day when tourists and residents can see a large variety of Costa Rican coins, folding money and coffee tokens.

The event is the end of the I Congreso Costarricense de Numismática, which will unite coin collectors from all over the country. The sale begins at 11 a.m. in the lobby of the Museos del Banco Central and is said to be the biggest of the year.
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A.M. Costa Rica's professional directory is where business people who wish to reach the English-speaking community may invite responses. If you are interested in being represented here, please contact the editor.

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San José, Costa Rica, Wednesday, June 28, 2006, Vol. 6, No. 127








Our readers repond
Real estate agents say they do not see market softer

Russ Martin, who works in real estate, wrote the following article as a reply to our report June 19 that said "Costa Rica’s real estate market is slowing. . . . Skyrocketing property values may be a thing of the past. . . ." in the Pacific coast real estate market. Mr. Martin incorporated views of local realtors.

By Russ Martin
Special to A.M. Costa Rica

I disagree strongly with Garland Baker's take on the Costa Rica real estate market in the June 19th edition.  He argues that the market here is about to collapse because:

- Speculators have whipped up a buying frenzy in order to inflate prices and "flip" properties to unsuspecting newcomers. 

- Most people buying real estate here are using cash from 2nd and 3rd mortgages on property in the U.S,. now that the U.S. market is softening they will be unable to pay off the mortgages for some unspecified reason.

- Tourism is on the decline to Costa Rica and the real estate market is closely tied to tourism.

- Nicaragua and Panama have flooded the market with cheap real estate.

Let's look at these premises and we will see why prediction of a crash in Costa Rican real estate  doesn't stand up.

Are prices inflated in Costa Rica?

In the first place, it is impossible to generalize about a "Costa Rica" real estate market.  Each area is completely different regarding infrastructure, development, kinds of properties on the market and demand.  In most areas of Costa Rica prices have risen in direct relation to improvements in the infrastructure.  Whether you are talking about a new international airport, a new hospital, a new school for expat children, high speed Internet or a paved road, improvements to an area create an increase in demand and prices.  There is no way that you can conclude that price increases related to infrastructure improvements are inflated or speculative.

What about markets that have been extremely active in the last few years, places like Tamarindo, Flamingo and Papagayo?  Have speculators succeeded in creating a feeding frenzy and people with property now will be forced to sell in the near future at fire sale prices? 

Larry Albright at Pacific Coast Realty in Flamingo says that "90 percent of my sales are not to speculators but to people who want to live in Guanacaste part-time and rent out the property until they retire and move here full time. The baby boomers are here already looking to get a little piece of paradise before the market gets crazy.  As far as infrastructure, I have never seen or heard of a place that is so disproportionate for property prices to lack of infrastructure (roads).  The roads are in the worst condition that I have seen in the 10 years I have lived in Flamingo, and we are still selling properties at record prices, and we have little inventory. Imagine if you will when the roads are passable and the Flamingo Marina issue gets resolved (if ever)."  

It is a fact that some people have flipped homes in a very short time and made money. Luxury homes that are beachfront or ocean view have appreciated tremendously in a relatively short time period. However the prices have more to do with the laws of supply and demand than with speculation.  The fact of the matter is that a person comparing beach property in northern Guanacaste to that in the California, Florida or the Caribbean islands a few years ago would have found it ridiculously inexpensive.  But they would have also found it remote and undeveloped. 

The new International airport in Liberia and a spurt in development has changed that, and prices have come up to more closely reflect that of competing real estate internationally, more developed countries.  Since these areas are now easily accessible with a three- or four-hour flight from many points in the U.S. and have a strong selection of services and amenities.

Another factor is that in some of the more popular beach towns, there is a natural limit on beach front and ocean view property.  If you want a nice house a few minutes from the beach with a panoramic ocean view somewhere in Costa Rica, then that isn't so hard to find.  But if you want that in Tamarindo or Flamingo, then it is almost impossible to find, and those houses that come on the market are snapped up in a hurry.  In places like Puerto Viejo near Limon, this same scenario will come to pass.  Although demand isn't so strong, yet, there are only a limited number of sites with ocean views and near the beach.  These properties are certain to command premium prices, once demand spikes and the beach front properties are no longer available.

Evidently the appreciation in Costa Rica's more developed areas is NOT due to speculation. 

Do most buyers use 2nd mortgages on U.S. property to buy here?

The fact is that a large percentage of foreigners buying property here are not even from the U.S.  A strong new market is wealthy Colombians and Venezuelans seeking amnesty and a safe place to raise their families.  Traditionally, Italians, Germans, French, British, Canadians and the Swiss have made up a huge percentage of foreign buyers in Costa Rica.  Just take a walk around Tamarindo or Puerto Viejo  
(Limón) and see how much English you hear spoken.

The slowdown in the U.S. doesn't affect these buyers in any way whatsoever, and if the Euro gets stronger that makes Costa Rican real estate even more attractive to them.  The Canadian dollar is at a 28-year high right now, based against the U.S. dollar.   More and more Canadians are coming to Costa Rica now. According to the Canadian Broadcasting Corp the loonie has gained 40 percent against the U.S. dollar since 2002, and many analysts predict that it will reach par.

Of the U.S.-based investors and individuals, how many of them are buying their property here with a 2nd or 3rd mortgage for speculative purposes?  A little investigation shows very few: 

Manuel Pinto at Caribe Sur Real Estate in Puerto Viejo states that "in our case, many of our buyers from the U.S. (and some other countries such as France!) are those that are fed up with their ever more restrictive governments — since the ‘war on terrorism’ began.  We have a significant number of buyers coming down who are getting out of the U.S. to get away.  I cannot imagine that this factor is about to decrease — quite the contrary — we see them coming down in larger numbers and faster!!!!

Betsy Waddington at ABC Real Estate in Samara says "I have a client from Arizona who is a realtor and because the real estate market is slowing down in the U.S., he has recently decided to liquidate about half of his holding properties in the U.S. and bring his investment to Costa Rica. He fell in love with CR on his last visit and bought a house and a lot in the same week.  He´s presently looking for more properties to buy. "

Albright in Flamingo: "I do not know of one of my clients that have borrowed money to buy property in Costa Rica.  While there are some that I am aware of,  they are the ones who may speculate with mortgage money and have to sell because the mortgage is due. Cash buyers are not under this pressure to get rid of their property at a loss."  

This shows that a large percentage of foreign buyers here are not even from the U.S., and that even most US buyers are paying cash for property they are investing in for the long term.
 
Is tourism on the decline in Costa Rica?

According to Instituto Costarricence de Turismo: "The Costa Rican tourism sector generated an income of $1.6 billion in 2005.  This amount represents an increase of 17 percent — $300 million more — compared to the figure in 2004, $1.3 billion, as informed by Rodrigo Castro, tourism minister.

". . . It is estimated that at the close of 2005 1,671,000 visitors will have come. That is an increase of 15%, . . .   Tourists visiting Costa Rica this year, rated Costa Ricans’ manners, its beaches and other protected areas as excellent, according to a survey conducted by the Costa Rican Tourist Board done to people exiting the country." 

According to Organization of American States statistics, the number of tourists arriving in Costa Rica has risen for the past 15 years consecutively:  Sample years - 1991 - 504,649;  1993 - 684,005;  1995 - 784,610;  1997 - 811,490.

In 1999 Costa Rica welcomed its 1 millionth tourist for the first time, which means that in the last five years tourism has risen nearly 60 percent. 

Apparently tourism is NOT on the decline in Costa Rica.

Is Nicaragua and Panama real estate less expensive or more attractive than Costa Rica?

A quick search on the Internet shows that real estate isn't all that cheap anymore:

Nicaragua
Mountain farm one hour from Managua - $200,000; 170m2 townhouse Apoyo Laguna - $175,000;  400m2 Colonial in historic Granada - $315,000; San Juan del Sur 100m2 in town $199,000; Coco Beach Tourist Development 190m2 home on 130m- 500m2 lot $190,000 to $390,000 on beach with "future" access. .

Panama
700 m2 Mini-estate home in Boquete with panoramic views - $695,000; 220m2 Boquete Charmer on 1/4 acre lot - $159,000;  Multifamily apartments (3 units) in Bocas Town - $450,000; New 2 story townhouse in Bocas Town - $195,000;

This isn't to say that there aren't any bargains in those countries, or that no one will move there.  Each country has its advantages and disadvantages, but it is impossible to predict that Costa Rica will experience some kind of home buying drought due to exceedingly inexpensive values in these countries.  But Nicaragua and Panama have NOT flooded the market with cheap real estate.

Conclusion

Now if you have read this far, you can see that arguments for the coming crash in Costa Rica real estate don't make sense, either in specific locations or in general terms. Apparently we can all invest profitably in Costa Rican real estate for many years to come. 

*Martin is the marketing coordinator for the American-European Real Estate Group and has written numerous articles on Costa Rica real estate for both local and international media.  



Most writers seem to live
outside of Costa Rica

Dear A.M. Costa Rica:

Did you ever notice how many "letters to the editor" are from people who do not live in Costa Rica?

Of the last seven regarding crime and real estate, six are from people who live the United States. And, one is from a man who lives in Acosta (A lovely out of the city area) who personally attacks a Mr. Bibb for generalizing his dislike and fear for living in the city of San José. (A love-it or leave-it type letter left over from the 70s, no doubt.)

But that same writer, John Rubida, wrote another letter a few years ago bemoaning how he got shafted in a real estate deal and thanked George Lundquist for giving him some good tips to avoid getting screwed a second time around. I guess fraud is not a crime in Texas?

"Yes", John, before you go there, we have been victimized and we do not hide our desire to effect much needed change in a country were we do live. It's nice to try and make it a better place.

Please do not embarrass yourself by attacking someone who is not happy living here or any other place and does not have the wealth to return home where he/she can retire in peace.

I do not know Mr. Bibb, and I do not know you, but if you were trapped in unhappiness, perceived or real, at minimum you would have my sympathy and best wishes. Try a little tenderness towards your fellow man or at least pick on someone your own size.

John Holtz
Escazú


Americans get blame
for worldwide gun flood


Dear A.M. Costa Rica:

Re your article "world is awash with illegal small arms," ex-pat readers may be interested to note that although small arm gun violence kills 1,000 people a day worldwide and leaves another 3,000 wounded (which by any definition is mass destruction), the main obstacle to ending this daily carnage is the good old U.S.A., with support of lovely places like China, Russia, Saudia Arabia and worse.

The U.S. rejects any measures that prohibit civilian possession of guns or sales of weapons to armed groups operating outside of government forces. In this it is backed by the U.S. National Rifle Association, which has accused the U.N. of conspiracy to outlaw the "constitutional right to bear arms" in America. What is the world supposed to concude — that of course guns don't kill people, Americans do? No wonder the war on terror is being lost!

R. Martin
Toronto/Quepos



Three time in a week

Dear A.M. Costa Rica:

Jim Folds and I could tell the same story. I stay months in Costa Rica every year and have done so for 12 years. My house will be done by July 07.

However, my last trip I was mugged for a cell phone, burglarized in a Gypsie-style raid at a B+B, and involved in a cat burglery all in one week. This is not
negative thinking but the truth about what is happening in Costa Rica.

Timatteo Gordo
Escobal.
Woman's viewpoint
on crime in streets


Dear A.M. Costa Rica:

Please tell Jim Folds who wrote about Costa Rica today in A.M. Costa Rica, the following:

He is a man. I am a woman, almost 60, here very bravely in Costa Rica completely alone, about ready to apply for pensionada. 

In my nine months here so far I have been robbed twice.  The first time was a young man who gained my trust and stole my wallet from within my house behind my back on a day when I was extremely ill. 

The second time was in broad daylight in front of hundreds of people and witnesses in the central market of downtown Ciudad Quesada, right after I left the bank with plenty of cash for going on my required every three-month trip to Nicaragua.  It was a very expensive lesson of $500 lost on how to better protect my money and myself, even in broad daylight. 

In these terms, in my opinion, Mr. Folds is talking through rose-colored glasses, and I think it would be a good thing if he reconsidered his thoughts and wrote another letter as perhaps an addendum to explain his circumstances and how perhaps he has even simply had good luck, or perhaps he already knew how to better protect himself--I don't know. 

But I think it would be a good thing for brave women, few as there might be, to have less rose-colored glasses information should they be seriously thinking about coming to Costa Rica for any amount of time. 

Donna Norton
Northern zone

Dodging tourism tax
is well-documented

Dear A.M. Costa Rica:

Well, Mr. Tourism Minister seems a bit unfit for his
job here. If he moans about short payments regarding the 3 percent tax, he should take countermeasures. But are there any? No. Costa Rica still lets expats (mainly U.S., but Europeans as well) screw the institutions, be it INS, CCSS, ICT.

Expats do think of themselves as smart guys when they manage to cheat. But on the other hand complaints about broken roads, a buggy tourism advertising campaign are blindingly fast at hand.
This doesn't really match.

I know for a provable fact that in the Quepos region two out of three hotel/restaurant owners do not pay what they are (by law) obliged to pay.

Tourism tax: People do not document cash payments, only credit card payments are documented for the Instituto Costarricense de Turismo. Some even just pay a certain sum, but do not hand in the documents. I myself have seen ICT declarations of just 10 percent of the monthly income of a hotel.

Countermeasures would be easy:

a) radically check for missing declarations.

b) compare declarations with guest registration forms (which every hotel has to keep for 5 years).

Insurance and Caja: 20 percent of all workers in the tourism industry over here are so-called trainees from abroad (not much different to illegal employment if you ask me). Over 50 percent of all planillas I have seen during the last months do not match reality. Be it lower-than-real wages or hidden employees.

As well this would be easy to detect IF authorities did get their act together — just compare planilla with payslips which every hotel owner keeps as proof of payment. As simple as it can get.

The real crime in Costa Rica is not the occasional drug dealer on the street. It's the business people. And guess what — they are even proud of cheating and boast with their shortcomings at every opportunity. The government and institutions like ICT are just too dumb to take action. As the president said: "We don't
need another tax plan, we just need to collect taxes properly."

Stefan Boehm
Quepos


You need to see Costa Rican tourism information HERE!



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San José, Costa Rica, Wednesday, June 28, 2006, Vol. 6, No. 127




Investment, development
topics for awards dinner


By the A.M. Costa Rica staff

The Cámara de Industrias de Costa Rica will ponder the challenges for competitiveness in the global economy during its annual award of excellence presentations Thursday night.

The main speaker will be Eva Paus, director of the Center for Global Initiatives and Professor of Economics at Mount Holyoke College. She wrote the book "Foreign Investment, Development and Globalization Can Costa Rica become Ireland?"

She has published widely on the impact of foreign investment and trade liberalization on technological change, productivity growth, and wage developments, particularly in Latin America.

The event is at 8 p.m. in the Hotel Real Intercontinental. Reservations are required at 202-5602 or 202-5650 and by e-mail:
camaradeindustrias@gmail.com

Intel will sell com branch
to Marvell Technology


Special to A.M. Costa Rica

Marvell Technology Group, Ltd. and Intel Corp. have announced that they have signed an agreement for Intel to sell its communications and application processor business to Marvell for $600 million plus the assumption by Marvell of certain liabilities.

The planned sale will give Marvell a strong presence in the growing market segment for processors used in smart handheld devices. The sale also will enable Intel to focus its investments on its core businesses, including high-performance, low-power Intel Architecture-based processors and emerging technologies for mobile computing, including Wi-Fi and WiMAX broadband wireless technologies, the company said.

The transaction is expected to close in approximately four to five months and is subject to regulatory review and other normal closing conditions, according to the announcement.

Intel’s communications and application processor business includes approximately 1,400 employees involved in a variety of functions, including engineering, product testing/validation, operations and marketing. It is expected that the vast majority of these employees will become employees of Marvell.

Intel currently intends to receive the entire purchase price in cash.

Newspaper in Venezuela
suffers a blackout


Special to A.M. Costa Rica

The Inter American Press Association said Tuesday it is greatly concerned by an attack on Venezuelan newspaper Correo del Caroní in Ciudad Guayana and demanded that authorities in the South American  country conduct an extensive investigation to determine responsibility for the incident.

Around 10 p.m. Monday the newspaper and a neighboring shopping mall lost power when the electricity lines into the two buildings were  sabotaged. When reconnection was attempted, there was a loud explosion and a larger area of the city blacked out. Power was restored early this morning.

The newspaper’s editor, David Natera, said that the incident was  “a terrorist act that might be linked to other attacks this newspaper has suffered.” Natera
was referring to a decision by pro-government Bolívar state lawmakers to cancel  the newspaper publishing company’s operating license and begin proceedings to  evict it in a move to silence criticism of the city and state administrations.

Traffic judges scammed
in impound lot car thefts


By the A.M. Costa Rica staff

You have to give the guy credit for bravado.

Investigators said that a 30-year-old man used forged papers in presentations to various traffic judges and got the judges to give him orders allowing him to remove vehicles from the Policia de Tránsito impound lot in Pavas.

The man then took the cars and sold them, said investigators who said they traced at least six vehicles to him. They said there may be many more.








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