The battle lines are being formed for and against a U.S.-Central American free trade treaty even though no text of the document has even been finalized.

Some public employees see any accord with the United States as a danger to the lumbering national telecommunications monopoly. Farmers are not anxious to compete in the world market.

President Abel Pacheco defined the side in favor Tuesday when he said that if Costa Rica is left out of the U.S.-Central American free trade treaty the significance would be total ruin for the country.

The president said that those planning an anti-treaty march for Monday were "like marching so that we all die of hunger." 

Pacheco has been a supporter of the free trade treaty, and it is his appointees who are negotiating the pact on behalf of Costa Rica. But he has not come out as strongly and clearly in the past  as he did Tuesday after the weekly Consejo de Gobierno meeting.

Meanwhile, the Instituto Costarricense de Electricidad probably has picked the wrong time to report that the electrical, power and telecommunications monopoly is going to generate a larger deficit than anticipated.

Alberto Dent, the minister of Hacienda, reported Monday that the monopoly known as ICE would show a 69 billion colon deficit for the fiscal year ending Sept. 30. That’s $169 million.

Pacheco said Tuesday that he wanted to have a meeting with the ICE board of directors and its executive president, Pablo Cob, to get some kind of explanation why the final deficit is so much higher than what ICE promised. The monopoly promised to reduce its deficit Sept. 4 as part of a deal made between it, the government and the Banco Central so ICE could get some $60 million in international bonds it said it needed to complete certain projects.

The company formalized its electrical increase this week. That increase is about 15 percent for residential customers. However, the company said that four cooperatives in the rural areas have not received increases and for that reason cannot reimburse ICE for the power they have purchased.

ICE said it has been seeking the electrical increase since October 2002. If certain telecommunication increases have been approved, the deficit would be even less, said the company.

Costa Rican officials, including Dent and Pacheco, are worried that the big ICE deficit will mean an increase in domestic interest rates and an additional devaluation of the colon in 2004. Pacheco noted that such factors affect the wellbeing and stability of the economy and the country. Pacheco said that he has defended ICE. He stated flatly that any free trade treaty would not bring the privatization of the monopoly. He said that such an issue was not even on the table.

Pacheco was similarly miffed at ICE workers when they went on strike May 16 to force the bond issue. He also expressed hurt when teachers followed three weeks later.

The free trade treaty also includes Guatemala, Honduras, Nicaragua and El Salvador. The Dominican Republic has also been included.  The final draft is supposed to be finished by the end of the year. Approval by all governments is required.

Some farmers probably will join the march Monday because they fear the impact of competition in a wide-open market, particularly with U.S. producers they say are heavily subsidized. Robert Zoellick, the U.S. trade representative, said that some aspects of the treaty would not come into force for 15 years.

Dear A..M. Costa Rica: 

I read your article of Monday, Oct. 13th, in regards to the investigation on fradulent residencies for pensionado and rentista Status.  The article is worded is a way that I feel it is afecting my best interest, because you mentione in it that Mr. Ryan Piercy is involved with this. 

Because lawyers associated with his group are being investigated.  I would like to make clear that the residency process for rentista and pensionado for the association  were only conducted by one lawyer at that moment in time. 

Being that I occupy the same building and that the association and I have just started now a good relation, it is hurting my law firm to mentione 

The reason for this is simple,  99 percent of our residencies are and allways have been presented directly to Immigration and not to the ICT, and in the inmigration office it is and always has been a requirement to present documents authenticated by the consul of Costa Rica of the country of origin. 

This authentication of documents is even offerd for free to our clients in order to help them with their residencies, and thru DHL COURIER, which has been succesfully conducting the authentication of documents of all our clients in all the consulates of Costa Rica that require it. 

Please clarify this point in your next edition. 

Investigators arrested a police official early Tuesday and said he was a drug courier.

The arrested man was identified as Ervin Santana Cortes, 38, an 18-year veteran with the Judicial Investigating Organization. He was based in Liberia in Guanacaste.

Santana was the driver of a rented car that was pulled over by agents a few miles before the Nicaraguan border. Agents said they found 75 kilos (165 pounds) of cocaine in the vehicle.

Investigators suspect that Santana used his position as a police official to transport drugs from Panamá to Nicaragua for eventual delivery to Guatemala and the United States.

Intel reports hike
in quarterly income

SANTA CLARA, Calif. — Intel Corp. announced third-quarter revenue of $7.8 billion Tuesday. The income was up 15 percent over second quarter and up 20 percent over the same period last year. 

Third-quarter net income was $1.7 billion, up 85 percent. Earnings per share were 25 cents, up 79 percent over second quarter and up 150 percent from 10 cents in the third quarter of 2002. 

The company assembles computer chips in Costa Rica.

Chlorine gas escapes
at water facility

Firemen and police went to a pumping plant of the national water company after chlorine gas escaped from a tank.

The accident took place about 2 a.m. Tuesday at the facility in Dulce Nombre de Tres Rios in Cartgago.

In all eight persons had to be taken to Hospital Caderón Guardia for treatment. Chlorine gas is highly toxic but it is used in the process of purifying water.

The Instituto Costarricense de Acueductos y Alcantarillados maintains the facility that treats water for much of the Central Valley.

U.S. backs president
in Bolivian crisis

The United States is urging Bolivians to support constitutional order and reject confrontation that could lead to more political violence in that country. The appeal followed violent protests against the government of President Gonzalo Sanchez de Lozada Monday that killed at least 14 people. 

The United States is making clear its support for the elected administration of Sanchez de Lozada in the face of increasingly-violent anti-government protests and demands for the resignation of the president, who began a five-year term in office only 14 months ago.

At a news briefing, State Department spokesman Richard Boucher said the United States is "deeply concerned" about events in Bolivia, where anti-government protests under way for several weeks escalated markedly on Sunday and Monday.

"These events are undermining constitutional order and democratic values and have led to a tragic loss of life," he said. "We repeat our call on Bolivians to reject confrontation that could lead to more violence. Respect for constitutional guarantees and the rule of law are fundamental to democracy in government."

Boucher said the United States fully supports a resolution late Monday by the Organization of American States appealing to all political and social sectors in Bolivia to help guarantee the stability of the country through dialogue and negotiation.

The measure, approved unanimously by the Organization of American States Permanent Council, also categorically rejected any action designed to disrupt Bolivia's democratic system. 

In a written statement Monday, the State Department said the United States and the rest of the international community "will not tolerate" any interruption in constitutional order in Bolivia and will not support any regime that results from undemocratic means.

Bolivia, once considered one of Latin America's most politically-unstable countries, has had civilian governments since 1982 after nearly two decades of military regimes.

President Sanchez de Lozada , a U.S.-educated businessman and free market advocate, was confirmed in office by the Bolivian congress last August after winning less than a quarter of the overall vote in a multi-candidate election.

Anti-government protests by labor unions and groups representing the country's indigenous population began in mid-September and escalated in recent days with demonstrations against a government plan to export natural gas to the United States and Mexico via Chile.

The president Monday agreed to postpone the gas-export plan but has refused to step down and says his government will defeat the protesters. 

Editor’s murder called
blow to free press

The Organization for Security and Cooperation in Europe says it is shocked by last week's murder of a Russian newspaper editor. 

The organization’s representative on freedom of the media, Freimut Duve, says this latest attack against press freedom in Russia again raises serious concerns about the state of free media in the country. 

Duve says he agrees with the assessment of Russia's interior minister Boris Gryzlov that the murder of Alexei Sidorov was a deliberate act of terror against the independent mass media. 

Sidorov was knifed to death outside his home in the city of Togliatti, in the Volga River region. He was the editor of the Togliatti Observer, known for its investigations into corruption and organized crime in the city that is home to one of Russia's leading automakers. His predecessor at the paper was murdered less than two years ago.  Authorities say there are no suspects so far in either killing. 
 

The apartment rented for a good price, a bit more than $175, and the location was great — just three blocks south of the Teatro Nacional. But there was something about the feeling you got when you stood alone in the largest of the two rooms.

Still as a newly arrived expat, I needed a cheap place, and the security was good. Two individual keyed doors and a gate separated my new second-floor home from the street. And the manager, an older Gringo, was pleasant.

As the price would suggest, my new home was a little bit of a wreck. The kitchen lacked a stove, the shower was the typical Tico suicide variety with electric current to the showerhead.

One small balcony overlooked bustling Calle 5. A back window  looked out on a small interior courtyard. A great pastime was to sit on the balcony in the evening and watch city life unfold and pass by.

I was there more than a week before I discovered the weeping wall. The interior stucco wall just was continually damp. Only occasionally would the moisture become heavy enough to be correctly termed a trickle. Yet a hand placed against the wall came away wet and clammy.

To counter this strange situation, I rearranged the furniture so that nothing touched and blocked the air flow to the wall. At night in the dark the water would catch the many reflections from the street outside and appeared to dance and sparkle. Sometimes in your mind you could see what could be a face, a cow or any hundreds of objects that a drowsy mind can project on random points of light.

Strangely, the wall never became mildewed or moldy. The water always seemed fresh. But since this was in the dry season it would seem a structural engineer would be needed to figure out exactly what was the source of the water. Later I realized I would have been better off calling a priest.

One night after having a few beers on the balcony I came inside and noticed a slight change in the weeping wall. There were darker patches becoming visible in the dusty gray stucco. The way the apartment was arranged I could see the wall and its growing pattern from my bed in the smaller of the two rooms.

The old Gringo manager told me he had known about the wall and that other tenants had complained. But he said he thought the dampness 

Then I awoke one night to find the bedclothes wet. All wet as if someone had covered the whole bed with a soppy towel. I, too, was wet with a mixture of sweat and clear water coursing down the contours of my face and chest.

A human being only needs about three or four mornings of waking up sopping wet to generate the urge to find another apartment. And that happened to me. 

I moved to the balcony and slept on a mattress on the floor. I was soaked in the morning. I tried sleeping on the floor of my bedroom. Same result. It was as if a big, sloppy cloud just descended on where I was sleeping. When I was on the balcony, the bed stayed dry. When I was on the bed, the balcony stayed dry.

The manager did not seem surprised when I told him I would be leaving for a slightly more expensive apartment a bit further from the center of town. In all I spent six weeks in the small apartment in downtown San José, and the last week was a wet one.

Four months later in a downtown bar I met a Canadian who told me he remembered the apartment. A young man he knew as Steve lived there several years before.

"Did you see the mural," he asked.

"What mural?"

The guy painted a giant picture of his Tica girlfriend on the inside wall of the living room. I was at the party where he unveiled it. A pretty good likeness."

"I never saw any mural or painting,’ I said.

"Oh, yeah, I remember now," said the Canadian. "They covered it with paint or stucco after he killed her and then killed himself one night."

The apartment still is there. From time to time I see an expat or a student entering the building. But I never see the same person twice.

To break with the long history of inequality in Latin America and the Caribbean, societies need to undertake deep reforms of political, social and economic institutions, improve access by the poor to vital services and assets — especially education — deliver income to poor families, and adopt specific policies to help indigenous people and Afro-descendants, a new World Bank study says.

"Inequality in Latin America and the Caribbean: Breaking with History" is the World Bank’s major annual research study on Latin America and Caribbean. It explores why the region suffers from such persistent inequality, identifies how it hampers development, and suggests ways to achieve greater equity in the distribution of wealth, incomes and opportunities.

"Latin America and the Caribbean is one of the regions of the world with the greatest inequality," said David de Ferranti, World Bank vice president for Latin America and the Caribbean. He along with Guillermo Perry, Francisco H.G. Ferreira and Michael Walton, guided the team that produced the report. "Latin America is highly unequal with respect to incomes, and also exhibits unequal access to education, health, water and electricity, as well as huge disparities in voice, assets and opportunities. This inequality slows the pace of poverty reduction, and undermines the development process itself."

The richest one-tenth of the population of Latin America and the Caribbean earn 48 percent of total income, while the poorest tenth earn only 1.6 percent, the research team found. In industrialized countries, by contrast, the top tenth receive 29.1 percent, while the bottom tenth earn 2.5 percent. 

Using the "Gini Index" of inequality in the distribution of income and consumption, the researchers found that Latin America and the Caribbean, from the 1970s through the 1990s, measured nearly 10 points more unequal than Asia, 17.5 points more unequal than the 30 countries in the Organization for Economic Cooperation and Development, and 20.4 points more unequal than Eastern Europe.

The data show that inequality in the least unequal Latin country, Uruguay‚ is higher than in the most unequal country in Eastern Europe and the industrialized countries. On average, income inequality has tended to worsen slightly in the region, though experiences have varied. Some relatively equal countries, including Argentina, Uruguay and Venezuela have experienced rises in inequality‚ Argentina dramatically so. By contrast Brazil, historically the most unequal country in the region, experienced a modest, but significant improvement. Mexico may also have enjoyed a small improvement.

The report singles out race and ethnicity as enduring determinants of one’s opportunities and welfare in Latin America. Indigenous and Afro-descended people are "at a considerable disadvantage with respect to whites," the report says, with the latter earning the highest wages in the region. Focusing on seven countries‚  Brazil, Guyana, Guatemala, Bolivia, Chile, Mexico and Peru‚ the study found that indigenous men earn 35-65 percent less than white men. The disparity between white women and non-white women was in the same range.

In contrast to enduring gaps correlated to racial and ethnic differences, Latin America has experienced progress in narrowing gender differentials in income and education. In much of the region, girls and young women are actually overtaking boys and young men in educational attainment.

Inequality is as deeply rooted as it is complex. The World Bank’s research team drew data from 20 countries based on household surveys covering 3.6 million people, and reviewed extensive economic, sociological and political science studies on inequality in Latin America. The team found that the unequal distribution of resources that characterizes the region today follows a pattern set with specific traits of European colonization in the region.

In modern times as in the early colonial periods, elite populations shaped institutions and policies to serve their interests first, the report found. For instance, most Latin countries did not achieve high

In a global economy, where "human capital" is critical to competitiveness, inequalities which result in a failure to develop people’s skills and knowledge to optimum levels, among other factors, can actually slow down the rate of economic growth, and weaken the poverty-reducing impact of the growth that does occur.

To address the deep historical roots of inequality in Latin America, and the powerful contemporary economic, political and social mechanisms that sustain it, the World Bank report outlines four broad areas for action by governments and civil society groups to build coalitions to break this destructive pattern. They are:

• Build more open political and social institutions, that allow the poor and historically subordinate groups, such as Afro-descendants and indigenous people, to gain a greater share of agency, voice and power in society. 

• Ensure that economic institutions and policies seek greater equity, through sound macroeconomic management and equitable, efficient crisis resolution institutions, that avoid the large regressive redistributions that occur during crises, and that allow for saving in good times to enhance access by the poor to social safety nets in bad times. 

• Increase access by the poor to high-quality public services, especially education, health, water and electricity, as well as access to farmland and the rural services the poor need to make it productive. 

• Protect and enforce the property rights of the urban poor. Reform income transfer programs so that they reach the poorest families, including use of measures that are conditional on keeping children in school and attending health services, so as to improve their lifelong income-earning capacity.

"The key to reducing inequality in Latin America is institutional reform," said co-author Perry, the  bank’s chief economist for Latin America and the Caribbean. "To overcome the inequality that undermines their efforts to get out of poverty, poor people must gain influence within political and social institutions, including educational, health and public services institutions. To enable them to achieve such influence, the institutions must be truly open, transparent, democratic, participatory — and strong."

Perry and fellow research team leaders Francisco H. G. Ferreira and Michael Walton concluded that success in "breaking with the long history of inequality in Latin America" depends on "strong leadership and broad coalitions" to achieve progress in the first area for action, namely to mobilize "the political agency of progressive governments and the poor."

As institutional reform proceeds, allowing poor people to gain access to decision-making, policies to reduce inequality are more likely to be adopted. Based on a review of policy experiences in Latin America, the World Bank research team identified three areas where specific reforms would have most impact in reducing inequality: fiscal and financial institutions, public services and the region’s  "truncated, elitist welfare state."

In addressing this complex agenda, the report focuses on a specific set of measures as an illustration of what is possible. For example, targeted income transfers conditioned on keeping children in school and attending health services could be an important part of a more equitable welfare state. In making the case for expanded use of conditional cash transfers, the research team cites examples of success programs such as those underway in Mexico, Brazil and Nicaragua.

These promising results indicate that the long history of inequality in Latin America and the Caribbean can be broken, the report says.