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(506) 2223-1327               Published Thursday, July 22, 2010,  in Vol. 10, No. 143        E-mail us
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Drug fund flow has likely effect on exchange rate
By the A.M. Costa Rica staff

One of the basics of a free market is a willing seller and a willing buyer but with neither under compulsion to act. An excess of goods or high demand can skew the price.

Such is the case with the delicate balance between the U.S. dollar and the Costa Rican colon.

Those who follow the dollar-colon exchange see a very volatile daily rate. The rate can swing from 506 to 540 in just a few days. Some expats blame conspiracy by bankers or other dark forces.

However, one of the hidden factors that influence the rate is the uneven flow of drug money from the north. The bulk of the dollars being smuggled south ends up in Caracas or Panamá, according to a survey or arrests elsewhere. But some ends up in Costa Rica, despite the risks.

Guatemalan money laundering officials say that the drug cartels have a new wrinkle. Instead of shipping dollars in bulk and risking the confiscation by alert police, the drug lords are thinking small. Just in May nearly $1 million legally came out of Guatemala's La Aurora airport bound for Panamá, Costa Rica and Nicaragua, intelligence sources say. Air passengers carried the money in amounts of from $9,000 to $9,900.

Such amounts are legal under Guatemalan law, although the money has to be reported. The amount does not have to be declared by travelers entering Costa Rica.

Guatemala's  Policía Nacional Civil has become adept at discovering smuggled money. Police there even use body x-rays. The usual smuggling technique is with a suitcase or briefcase with a false bottom. Guatemala's División de Análisis e Información Antinarcótica said that in the last 16 seizures police confiscated $1,989,373. In one week in May police confiscated nearly $2 million at the airport, according to Guatemalan news sources. And Guatemala is just one country where travelers take planes to go south.

Costa Rica has made several confiscations of supposed drug money that came with passengers on flights from México.

These confiscations  create the need for more reliable transportation.
exchange rate

A steady stream of air and bus passengers legally carrying an amount of dollars less than $10,000 avoids the problem of confiscation. The tickets and fees to the mules are not significant because major drug cartels are willing to pay 25 percent of the funds for transportation.

The question that most touches expats is what do the couriers do with their funds when they reach Costa Rica.

In the last few days the dollar has strengthened against the colon. The rate today is that one dollar can buy 517 colons and 526.5 colons are required to buy one dollar. This is about an 11-colon jump from Monday.

It may be a coincidence but Honduran police said Friday that a Panamanian and a Venezuelan were being sought after searchers located 240 plastic packages with about $1 million in their specially designed clothing. The pair tried to head south July 15. That is $1 million that never had an effect on the exchange rate here.

Costa Rica has long been the destination of so-called land banking where illegal funds are invested in real estate or businesses to obscure the origins. Banks have tightened up their regulations, but currency smugglers have a way around such rules, and some of the dollars do enter the local economy.

A stream of individuals carrying up to $10,000 each should not present a banking problem because such amounts do not even rise to the level that must be declared in Costa Rica. The funds can just be deposited in appropriate accounts with the obvious impact on the dollar-colon exchange rate.


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San José, Costa Rica, Thursday, July 22, 2010, Vol. 10, No. 143

Costa Rica Expertise
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140 persons sought shelter
after Tuesday's storm


By the A.M. Costa Rica staff

Another powerful thunderstorm blew through the Central Valley Wednesday afternoon, but the result was minimal compared to the havoc a Tuesday storm caused.

San José got 29.7 millimeters (1.17 inches) in just two hours. In Bagaces, Guanacaste, 42.1 millimeters (1.66 inches) fell. Some city streets were flooded, but the sun was out by 3:30 p.m.

Meanwhile, rescue workers were assessing the problems caused by the Tuesday storm that dumped up to 2.5 inches of rain on the Central Valley.

The Instituto Meteorológico Nacional predicts similar events for today in the Central Valley, the Pacific coast, and in the mountains of the northern zone and Caribbean.

The Comisión Nacional de Prevención de Riesgos y Atención de Emergencias said that 140 persons had sought shelter Tuesday evening. That included the seven families that lost their homes in Barrio Fatima in Santo Domingo de Heredia. Some 43 other homes there were damaged.

The emergency commission said that 20 cantons in the country felt the impact of the storm.

Bridges went down in Tibás and in Lagunilla de Heredia.

The commission logged other incidents in Alajuelita, Moravia, Tibás, Goichoechea and Pérez Zeledón in the province of San José; La Unión, Turrialba and Jiménez in Cartago; Tilarán in Guanacaste, and Buenos Aires in Puntarenas.

The Heredia train line was undermined in one point and a rail bridge was being studied for damage. The line was under water at Santa Rosa de Santo Domingo, and transport engineers were waiting for the water level to subside to see the extent of damage. The train trips form San José ended there Wednesday.

The Cruz Roja had the most dramatic rescue. A 7-year-old girl slipped, fell into a stream and was carried away by the current. Rescue workers saved her and got her to the Hospital Nacional de Niños.

Highway officials opened the Ruta 32 at 7 a.m. after clearing another slide. Officials urged motorists not to use this route at night when it is raining due to the threat of more slides.


Police plan checkpoints
to study bus passengers

By the A.M. Costa Rica staff

Fuerza Pública officers will be stopping buses on two major national highways starting at 6 a.m. today to look for criminals.

The police are being ordered to the checkpoints by José María Tijerino, the security minister, who met with the Cámara Nacional de Transportistas.

Tijerino said that the stops would discomfort bus passengers but the presence of the police is much better than the presence of criminals.

The police have been instructed to look for people compromising the integrity of the bus passengers, said the Ministerio de Gobernación, Policía y Seguridad Pública.

Bus stickups have become routine, and drivers frequently are robbed of their fares and change.


Development bank earmarks
$1.8 billion for Latin lands


Special to A.M. Costa Rica

The president of the Inter-American Development Bank, Luis Alberto Moreno, announced this week that under the framework of the bank’s capital increase, it will allocate about $1.8 billion annually to integration projects for Central America, South America and the Caribbean.

Moreno made the announcement at the Special Summit of Heads of State and Governments of member countries of the Central American Economic Integration System held today in San Salvador.

The Summit takes place at a time when Central America is looking past the economic crisis and exploring ways to extend  its links to the global economy and the Asian emerging markets in particular. The region is also poised to take advantage of trade agreements.

Bank experts point out that Central America is the most integrated developing region. Reciprocal trade levels in Central America are among the highest in the world and the trade liberalization is advanced, with a harmonized common external tariff that already applies to 95 percent of all commerce.


Our reader's opinion
How could U.S. Navy ships
be controversial here?


Dear A.M. Costa Rica:

Found it interesting that somehow a U.S. Navy amphibious ship visiting Costa Rica was somehow new or threatening. Around 1975, as a young lieutenant commander, I was on an amphibious squadron staff. We were on the flagship, a helo carrier, an earlier version of the USS Iwo Jima soon to visit Costa Rica. Part of our deployment was to deliver the Marines on board to Panamá where they would undergo extended jungle training.

Waiting for the Marines to finish, the six squadron ships would exercise at sea for a week and then be distributed to individual ports for R and R. Cartagena and Barbados were two of my favorites. Each ship did a post-visit report. Amazingly, the sleepy Costa Rica kept getting very high scores. Being staff, logistics got myself scheduled into Costa Rica.  Talked with the crew, why were they so happy in Costa Rica. They explained, they went ashore and no one cheated them or robbed them. The people looked after them and kept them out of trouble. The easy ways of the ladies I'm sure also helped. They really liked the people. The commanding officers were happy because they didn't have incidents ashore.

Move ahead 25 years.  Looking for a second home, the first place that came to mind was Costa Rica, visited and built a house. Now 10 years later still enthusiastic about my decision resulting from my Navy amphibious forces visit to Costa Rica. Also have no idea how U.S. Naval amphibious ship visiting Costa Rica ports could be controversial.
Steve Hovany
Playa Hermosa and Chicago, Illinois

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A.M. Costa Rica guide

This is a brief users guide to A.M. Costa Rica.

Old pages
Each day someone complains via e-mail that the newspages are from yesterday or the day before. A.M. Costa Rica staffers check every page and every link when the newspaper is made available at 2 a.m. each weekday.

So the problem is with the browser in each reader's computer. Particularly when the connection with the  server is slow, a computer will look to the latest page in its internal memory and serve up that page.

Readers should refresh the page and, if necessary, dump the cache of their computer, if this problem persists. Readers in Costa Rica have this problem frequently because the local Internet provider has continual problems.

Searching
The A.M. Costa Rica search page has a list of all previous editions by date and a space to search for specific words and phrases. The search will return links to archived pages.

Newspages
A typical edition will consist of a front page and four other newspages. Each of these pages can be reached by links near the top and bottom of the pages.

Classifieds
Five classified pages are updated daily. Employment listings are free, as are listings for accommodations wanted, articles for sale and articles wanted. The tourism page and the real estate sales and real estate rentals are updated daily.

Advertising information
A summary of advertising rates and sizes are available for display and classifieds.

Contacting us
Both the main telephone number and the editor's e-mail address are listed on the front page near the date.

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San José, Costa Rica, Thursday, July 22, 2010, Vol. 10, No. 143

Rapid Respose
Rock n roll

Expat security faults and other woes cited for immigration
By the A.M. Costa Rica staff

The Contraloría de la República said it found weaknesses in the security of the immigration department's computer systems that jeopardize the integrity of the issuance of cédulas.

It also found other problems, including lack of a fire suppression system in the area where the computer servers are kept.

The investigation also determined that the Dirección General de Migración and Extranjería at its main La Uruca headquarters did not have the source code or access to the data base created by the system used to create cédulas. Therefore, the Contraloría said, the department cannot check the accuracy of the system.

Not having the source codes of the computer system is a security measure, but the Contraloría said that the situation makes the immigration department dependent on LaserCard Corp., the Mountain View, California, company which provided the system under a nearly $2 million contract. The system collects data and emits a plastic card.

The card’s optical memory stores cardholder information, including high resolution color facial image, fingerprint images and templates (for automatic one-to-one identity verification), digitized signature and biographic data. The company also produces the computerized machines that process the data and produce the plastic cards.

The cédulas are issued for a variety of residency states, including pensionado, residente sin limite and rentista.

The Contraloría makes similar inspections of public agencies all the time. The period covered in the report made public Wednesday is all of 2009.

In an afternoon response to the report, the immigration department said it had received the source code under seal from LaserCard in December.

The immigration department is viewed by expats to be just a short step from chaos, so the findings of the Contraloría are not unexpected. The immigration department said it was planning to purchase a fire suppression system specific to data centers. And it's said
immigration room
Contraloría photo
Study said that there was a lot of clutter like this at the immigration headquarters. That's no surprise for expats because immigration workers frequntly misplace files

remodeling is in the works.

The Contraloría complained about hallways filled with boxes and an air conditioner placed above a power supply with the potential of dripping water.

The main complaint, however, was that the identification information of foreigners was not as secure as it could be. One problem was a movement detector located at the entrance to the data center. It was out of service, so anyone could enter, the Contraloría said. In response, the immigration department said that the system measured up to international standards.

The department said it would take steps to comply with many of the study's requirements. The Contraloría gave a deadline of Sept. 30.


Accent in a foreign language hurts credibility, study says
By the University of Chicago news service

A foreign accent undermines a person’s credibility in ways that the speaker and the listener don’t consciously realize, new research at the University of Chicago shows.

Because an accent makes a person harder to understand, listeners are less likely to find what the person says as truthful, researchers found. The problem of credibility increases with the severity of the accent.

“The results have important implications for how people perceive non-native speakers of a language, particularly as mobility increases in the modern world, leading millions of people to be non-native speakers of the language they use daily,” said Boaz Keysar, a professor of psychology at the University of Chicago and an expert on communication.

“Accent might reduce the credibility of non-native job seekers, eyewitnesses, reporters or people taking calls in foreign call centers,” said Shiri Lev-Ari, lead author of “Why Don’t We Believe Non-native Speakers? The Influence of Accent on Credibility,” written with Keysar and published in the current issue of the Journal of Experimental Social Psychology. Levi-Ari is a post-doctoral researcher at the University whose work focuses on the interactions between native and non-native speakers.

To test the impact of accent on credibility, American participants were asked to judge the truthfulness of trivia statements by native or non-native speakers of English, such as, “A giraffe can go without water longer than a camel can.”

Simple prejudice could affect ratings of truthfulness, so the researchers tried to minimize that effect by telling participants the information in the statements was prepared for the speakers, and was not based on the speakers’ own knowledge.

Despite knowing the speakers were reciting from a script, the participants judged as less truthful the statements coming from people with foreign accents. On a truthfulness scale prepared for the experiment, the participants gave native speakers a score of 7.5, people with mild accents a score of 6.95 and people with heavy accents  6.84.

“The accent makes it harder for people to understand what the non-native speaker is saying,” Keysar said. “They misattribute the difficulty of understanding the speech to the truthfulness of the statements.”

In a second experiment, researchers tested whether awareness reduces the impact of accent on perceived truthfulness. Researchers told participants that they were being tested to see if accents undermine credibility.

That experiment was conducted with identical recorded statements, but with different results. While participants rated statements with mild accent just as truthful as statements by native speakers, they rated heavily accented statements as less truthful, Lev-Ari said.

Accent is one of the factors that influences people’s perception of foreigners in a society, Keysar pointed out. But its insidious impact on credibility is something researchers had not previously known, he added.


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San José, Costa Rica, Thursday, July 22, 2010, Vol. 10, No. 143

Escazú Christian Fellowship
xx
Guoadalupe Missionary Baptist Church


Latin recovery is reported to be faster than expected

Special to A.M. Costa Rica

Latin America and the Caribbean is consolidating its recovery from the global economic slowdown, posting higher-than-expected growth in recent months, although some countries in the region face serious pitfalls, according to a new United Nations report.

The 2009-2010 regional economic survey, conducted by the U.N. Economic Commission for Latin America and the Caribbean and released Wednesday, forecasts that the region will expand by 5.2 per cent this year after the recovery began in the second half of last year. Overall unemployment rates are likely to ease from 8.2 per cent to 7.8 per cent.

But growth is forecast to slow to 3.8 per cent next year because of continued uncertainty about global economic prospects, especially in Europe, a potential fall in remittances to some countries and the risk posed by the high debts of some Caribbean countries.

Alicia Bárcena, the commision's executive secretary, told a meeting for the report’s launch in Santiago, Chile, that this year’s growth rate is higher than expected.

“What stands out are the members of Mercosur and countries with greater capacity to implement public policies, as well as those with strong domestic markets spurred by regional activity and their exports to Asia,” she said. Mercosur is a South American trade grouping.

Some of the region’s largest economies are driving the
 revival, according to the commission. Brazil is expected to record a growth rate of 7.6 per cent this year, while Uruguay (7.0 per cent), Paraguay (7.0 per cent), Argentina (6.8 per cent) and Peru (6.7 per cent) also showing gains.

Private consumption is on the rise again following the slight improvement in employment, while lending has also increased, as have investment and export revenue, said the report.

In its survey the commission found that macroeconomic policies by some governments in the region in the years before the global economic crisis have also assisted, ensuring that those countries have better public accounts, reduced debts and increased international reserves.

Yet other countries are continuing to struggle. Venezuela’s economy is forecast to contract by 3 per cent, there will be negative growth in several Caribbean nations as well and Haiti will endure a fall of as much as 8.5 per cent because of the catastrophic earthquake in January.

The commission warned that the patchiness of the economic recovery in other regions, particularly Europe, dampens the prospects of strong growth next year. The amount of remittances – which comprise a significant segment of the gross domestic product of countries such as Ecuador – are likely to fall. These are monies sent home by citizens working elsewhere.

Many Caribbean nations also have high debt burdens which leave them vulnerable to economic problems in the months ahead, said the commmission.


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San José, Costa Rica, Thursday, July 22, 2010, Vol. 10, No. 143

Medical vacations in Costa Rica

Spanish leader sees shift
coming in U.S.-Cuba ties


By the A.M. Costa Rica wire services

Spain says Cuba's release of dozens of political prisoners would improve its relations with the European Union and the United States and could eventually lead to the lifting of the long-standing U.S. embargo against the Communist-led island.

Speaking Wednesday in Madrid, Spanish Foreign Minister Miguel Ángel Moratinos told Parliament that the releases would have "political consequences" in U.S. relations with Cuba and prompt a shift in EU policy toward the island.

Moratinos' remarks coincided with the arrival of a 12th freed political prisoner in Madrid.  Another eight are expected in the Spanish capital this week.  Cuba has agreed to release 52 political prisoners in a deal involving Madrid and the Roman Catholic Church.

The 52 were among 75 dissidents arrested and sentenced to lengthy prison terms following a 2003 government crackdown.  Cuba has said it holds no political prisoners, only what it calls mercenaries who Havana claims are working with the United States to undermine Cuban communism.  

U.S. President Barack Obama has said he wants improved relations with Cuba, and his administration has eased travel and money transfer restrictions for Cuban-Americans with relatives on the island.  But Obama has said the embargo will stay in place until Havana takes steps toward democratic reform.

Tuesday, the State Department says diplomats at the U.S. Interests Section in Havana have met with families of remaining political prisoners in Cuba, following the recent release of some prisoners.

State Department spokesman P.J. Crowley said the meetings are part of an ongoing dialogue with families of Cuban political prisoners.  He said the U.S. is stressing in the talks that it hopes Cuba will release all the political prisoners.  But he said how far and how fast the Cuban government will go is a major question.

The United States and Cuba do not have formal diplomatic relations, but have interests sections that are technically part of the Swiss embassies in each other's capitals.

Valenzuela will travel
to Caribbean next week


By the A.M. Costa Rica wire servcies

Arturo Valenzuela, U.S. assistant secretary of State,  travels to the Caribbean next week for talks on security and other issues of mutual interest.

The State Department said Tuesday that Valenzuela will travel to the Bahamas, Jamaica and the twin-island nation of Trinidad and Tobago from Sunday through next Thursday.  Talks are expected to cover a new regional security partnership known as the Caribbean Basin Security Initiative, along with economic opportunity and competitiveness, energy, the environment and health initiatives.

Last month, Secretary of State Hillary Clinton pledged continued U.S. support to fighting drug trafficking and other security problems in the region. 

While in Barbados, Secretary Clinton and members of the Caribbean Community marked the launch of a new regional security partnership known as the Caribbean Basin Security Initiative.  It calls for $124 million to be spent over a two-year period to help countries counter illicit trafficking in drugs and small arms. 


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San José, Costa Rica, Thursday, July 22, 2010, Vol. 10, No. 143



Latin American news
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Press group protesting
Chávez TV stock grab


Special to A.M. Costa Rica

A hemispheric press group, the Inter American Press Association has protested an announcement by Venezuela’s President Hugo Chávez that his government will take over a percentage of the shares in the privately-owned television network Globovisión, calling the action “a flagrant assault upon press freedom and freedom of enterprise in Venezuela.”

Chávez announced Tuesday details on how the government will become part owner of Globovisión, stating that his government will control 45.8 percent of the stock comprised of shares now belonging to Nelson Mezerhane, president of the Federal Bank, which was seized last month, 5.8 percent from another company and a further 20 percent owned by Luis Teófilo Núñez, who died in 2007.

In response, the television network announced that it was reaffirming its editorial independence and that under its statute’s terms individual shareholders do not have a right to name directors. Rather “members of the Board of Directors are appointed by the meeting of shareholders on a vote by more than 55 percent of the capital stock.”

Alejandro Aguirre, editor of the Miami, Florida, Spanish-language newspaper Diario Las Américas, declared, “In view of this new controversy surrounding Globovisión, we strongly reject the authoritarian attitude of the government of President Chávez, who is once again blatantly assaulting press freedom and freedom of enterprise.” He added that this episode is part of a strategy of connected offenses against the privately-owned and independent news media, in place for the past decade, when he has ordered the shutdown of TV and radio stations, and newspapers have been financially strangled merely for criticizing government acts and exercising their right to express an opinion.”  He is president of the Inter American Press Association.

Robert Rivard, chairman of the Association's Committee on Freedom of the Press and Information and editor of the San Antonio Express-News, Texas, recalled that for the past four years the organization has denounced the Venezuelan government’s campaign to malign the television network and its president and owner, Guillermo Zuloaga, who was forced to flee the country under political, presidential and judicial persecution. 

Zuloaga, who was awarded the organization's 2010 Grand Prize for Press Freedom, faces more than 40 lawsuits and administrative actions against Globovisión, as well as a charge brought in April this year of criminal dissemination of false information and offending the head of state, along with another allegation of usury in another, non-journalistic company.

The Inter American Press Association is a not-for-profit organization dedicated to the defense and promotion of freedom of the press and of expression in the Americas. It is made up of more than 1,300 print publications from throughout the Western Hemisphere and is based in Miami, Florida. A.M. Costa Rica is a member.


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