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These stories were published Thursday, Nov. 11, 2004, Vol. 4, No. 224
Jo Stuart
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Antigua and Barbuda controversy
U.S. rejects World Trade gambling report
Special to A.M. Costa Rica

The United States says it fundamentally rejects a World Trade Organization report, released Wednesday, that found the United States' ban on international Internet gambling represents a violation of U.S. trade commitments, according to the Office of the U.S. Trade Representative.

Antigua and Barbuda filed a case before the World Trade Organization in 2003, contending that the U.S. restrictions on Internet gambling violated U.S. trade commitments. The 287-page report issued Wednesday confirmed a preliminary ruling in the Caribbean nation's favor.

U.S. trade officials rejected the report as "deeply flawed," and contend that the United States clearly intended to exclude gambling from the services commitments it made in 1995 trade negotiations.

The case revolves, in part, around which services the United States intended to commit in 1995 under the auspices of "other recreational activities."

In a briefing Wednesday, a senior U.S. trade official said that it is "inconceivable" to assert 

that U.S. negotiators in 1995 intended to enter into commitments in violation of U.S. federal and state laws.

A trade spokesman, Richard Mills, echoed the sentiments of the senior U.S. trade official in a separate statement: "Throughout our history, the United States has had restrictions on gambling, like many other countries," he explained. "Given these restrictions, it defies common sense that the United States would make a commitment to let international gambling operate within our borders."

Both Mills and the senior trade official indicated that the United States will appeal the report, and they expressed confidence that the World Trade Organization appellate body will appreciate the concerns and reverse the ruling.

Antigua and Barbuda have argued that Internet gambling and sportsbooks are part of its 1990 development plan.

The trade panel said that 49 of 50 U.S. states maintain lotteries and that many other gambling outlets exist there. It also said that the intent of the United States in 1995 did not matter. What counted was the wording of the trade agreement. 

Elca creditors hear of mystery bank buyout plan
By the A.M. Costa Rica staff

Banco Elca depositors heard Wednesday night that an unidentified U.S. institution wants to purchase the troubled company.

This was revealed at an evening meeting at the Hotel Ambassador by representatives of B y L Asesores, a consulting firm operating here on behalf of the unidentified bank.

Costa Rican officials closed down Banco Elca, which carried deposits from a number of expats, June 29 when, they said, the bank had less reserves than the law allowed.

The meeting Wednesday night attracted from 80 to 120 persons according to individuals who attended. The U.S. bank would pay about $9 million to obtain the license, the assets and liabilities of Elca. It was unclear who would get the money.

Elca itself has limited long-term assets, the crowd was told, because the bulk, some 80 percent, of its mortgages and obligations from customers has been sold off to Banco Promerica.

The consulting firm has set up an e-mail address,, and a phone numbers, 301-2349, for depositors who want more information. The person who will answer the questions was identified as Ana Gutiérrez.

The bank appears to have nearly $10 million in debts and obligations, but some 75 percent of the depositors have been paid off, the group was told.

The Asociación Bancaria Costarricense used an 

emergency fund to pay off most of the depositors who had $10,000 or less in the bank.

Subsequent to the closure of Corporación Elca S.A., investigators of the Ministerio Público detained bank president Carlos Alvarado Moya. He still is jailed for investigation.

The regulator agency, the Superintendencia de Entidades Financieras, did not appear to be represented at the meeting Wednesday. The agency has been shy about making public statements, and rumors are rife.

Elca has a bigger image among expats than its size would suggest because employees frequently attended seminars for persons thinking of moving to Costa Rica.

Most of the depositors were not at the meeting Wednesday. One source estimated that there are about 1,400 depositors still with claims against the bank.

The consulting firm said it would like depositors to set up a committee for negotiations. Several persons at the meeting said that the key point was the identity and the stability of the unidentified U.S. institution.

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Vargas gets out of jail
but ex-presidents stay

By the A.M. Costa Rica staff

The former director of the Caja Costarricense de Seguro Social got out of jail Wednesday, but two former presidents were not as lucky.

One, Rafael Ángel Calderón Fournier, got his preventative detention cut from nine months to two months, expiring Dec. 22. But there is no guarantee he will be home for Christmas. Judge Didier Mora of the II Circuito Judicial de San José said he would take another look at the case then.

The situation looked worse for Miguel Ángel Rodríguez Echeverría. His defense lawyers had entered a habeas corpus action that went directly to the Sala IV constitutional court. Tuesday the court decided unanimously to reject the application, a spokesperson for the Poder Judicial said Wednesday.

What is worse is that although lawyers for Rodríguez argued that there was not sufficient proof linking the former president to crimes, the constitutional court found otherwise and said that elements of proof do exist that link him to allegations of accepting kickbacks.

The former director of the Caja is Eliseo Vargas. He was among the first implicated in the massive corruption scandal. In June La Nación, the newspaper, revealed that he was living in a house that had been purchased by a firm linked to Corporación Fischel, the drug and medical equipment supplier.

One thing led to another, and Vargas and executives of Fischel were quickly accused of accepting a $9 million commission on a $39 million loan made by Finland to promote the sale of medical equipment from that country.

Later, Calderón, among others, was accused of being one of the architects of the commission deal. He served from 1990 to 1994.

Meanwhile, Rodríguez, who served from 1998 to 2002, was accused of getting the lion’s share of a kickback from the French telecommunications firm Alcatel on a major cellular telephone contract. Rodríguez was the former president who served briefly as secretary general of the Organization of American States until the scandal broke in mid-October.

Vargas is not off the hook completely, although he is believed to be cooperating with prosecutors. He must not leave the country. He must sign in with the prosecutor every 15 days. He has to surrender his passports. He may not go near the Caja offices. And he may not have contact with others being investigated in the scandal.

Pacheco urges action
in the face of bribes

By the A.M. Costa Rica staff

President Abel Pacheco told business leaders Wednesday that they should file complaints if they are hit up for bribes.

The president also attacked the subculture of corruption in which every official permit, transaction or license had an illegal price that had to be paid.

Citing Sor Juan Inés de la Cruz, he maintained that the sin of those who seek bribes is equal to the sin of those who pay them.

Pacheco said that a new law against corruption and illegal enrichment favors those who would contract with the state. The only valid consideration, he said is the quality of the offer, the best price, the experience of the contractor and good faith.

Most public employees were honorable, he said.

Pacheco was speaking to a lunch meeting of the Costa Rica-North American Chamber of Commerce, Amcham.

Pacheco said the nation has to protect the favorable climate for investment and that the best climate for investment is one in which there is transparency, legal security, fiscal responsibility, social peace, political stability and quick, complete and objective justice.

He thanked the business people for investing in Costa Rica.

Focus of flood aid
is in southeast

By the A.M. Costa Rica staff

More than 450 persons have been flooded from their homes in the Sixaola and Talamanca areas in southeast Costa Rica.

In all flooding on the Caribbean coast forced out more than 2,000 persons, most of them to public shelters.

Sixaola suffered severe flooding from the swollen Río Sixaola. Also hit were the communities of Catracho, Margarita, Celia, Catalina Bambú and China Ki Cha.

However, the Comisión Nacional de Prevención de Riesgos y Atención de Emergencias noted Wednesday that the weather conditions were moderating and that rainfall has decreased significantly.

A number of business and residential sections of Sixaola were under five feet of water.

The commission warned that care should be taken further north on the Caribbean coast, including Limón centro, Siquirres, Matina and Sarapiquí. All those areas were exposed to Caribbean rainfall. The most recent was brought on by a cold front parked over the Caribbean since Sunday.

Despite the flooding, there have been no reports of serious injury, death or major damage to public facilities.

Limón man jailed
as abuser of boys

By the A.M. Costa Rica staff

 A Limón man has been jailed as a suspect in using Play Station devices to lure boys into sexual abuse. The 28-year-old man, identified by the last names of Aporta Salazar.

Officials said he was turned in by a 12-year-old victim.

Aporta used to travel to San José as well as Limón to locate youngsters he could influence, officials said.

He was given three months preventative detention.

Film festival in full swing

By the A.M. Costa Rica staff

The Muestra de Cine y Video Costarricense began Wednesday at the Cine Varidades in San José. The opening night featured 10 short films directed by Costa Ricans.

The festival is composed of eight segments. Each segment contains several short films. All of the films are in Spanish and depict Latin American life. 

The festival has two showings today and again on Friday at 4 p.m. and 7 p.m. The final segment will be Saturday at 4 p.m.

The festival is now in its eighth year and is considered a very important part of Costa Rica’s artistic and cultural development.

The Cine Varidades is the oldest movie house in Costa Rica. It is downtown, on Calle 5, between Avenida Central and Avenida 1. 
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By the A.M. Costa Rica staff

Those in the Castro Mora Family are typical Desamparadeños, who like to start the Christmas season Nov. 1.

The family is the first in Desamparados to decorate the house with the representations of the birth of Jesus. They use images from México.

The statutes are huge and occupy all the family’s front yard. Family members took about 21 days to put about 1,500 lights up. They haven't finished yet. Everyone participates.

The idea, says José Castro, the father, is to remember as early as possible the real meaning of Christmas before the season knocks out everyone. The nativity scene is called a portal, or, as Costa Ricans say, a pasito.

Wise Men are off searching for Baby Jesus

PriceSmart will construct a fourth store here on land near Moravia
By the A.M. Costa Rica staff

PriceSmart said this week it had acquired land in San José. The firm plans to use the land to open a fourth store. The store will open during the second half of 2005. 

The acquired land is near Moravia. PriceSmart recently began cleaning out the land and will begin construction soon. Edgar Zurcher, a member of the PriceSmart board, said, "Based on the history of the company, it will take nine months to finish the construction."

PriceSmart operates U.S.-style membership 

shopping clubs in Central America, the Caribbean, and Asia. The firm currently has three stores in operation in Costa Rica, in Heredia, Zapote, and Escazú. 

PriceSmart officials hope that the new location in Moravia will broaden its geographic base. Jose Luis Laparte, the president of PriceSmart, said "A fourth location will provide us with geographic coverage in an area of the city that is not well served by our other three locations." 

PriceSmart also reported that the company’s October net sales were up 10.5 percent from the same period last year.

Peruvian airline designated as a drug trafficking organization
Special to A.M. Costa Rica

WASHINGTON, D.C. — The U.S. Office of Foreign Assets Control (OFAC) has formally added Aero Continente, a passenger and cargo airline based in Lima, Peru, to its list of entities involved in drug trafficking. In addition, the Treasury Department agency designated Nuevo Continente as another name for Aero Continente. 

"The drug trade is driven, first and foremost, by financial greed and the desire for profit. Aero Continente is a financial facade controlled by the notorious Peruvian drug kingpin, Fernando Zevallos Gonzales," said Robert Werner, director of the asset control office. "The Bush Administration continues to unravel drug trafficking operations and their illicit financial infrastructures by taking actions like today's, which deprive narcotics traffickers of illegal profits funneled through companies . . . ."

The airline has been blocked by the Treasury pending further investigation since June 1  following President Bush's decision to identify Zevallos Gonzales, the airline's founder, as a trafficker under the Foreign Narcotics Kingpin Act. 

Zevallos Gonzales has been a major figure in Peruvian narcotics trafficking for more than two decades. The action reaffirms that U.S. entities and citizens are prohibited from conducting business with Aero Continente, and continues the blocking of assets of Aero Continente in U.S. jurisdiction. 

After June 1, the airline underwent various alleged changes in ownership and changed its name to Nuevo Continente. Despite the ostensible ownership change, the airline was unable to demonstrate to the satisfaction of the Treasury Department that all ties with the airline's former owners had been severed. 

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Diplomat says life is tougher for those in Cuba
By the A.M. Costa Rica wire services

HAVANA, Cuba — The senior U.S. diplomat in Cuba says life for ordinary Cubans is becoming more difficult by the day, prompting more of them to try to leave their country. 

James Cason, the chief of mission of the U.S. Interests Section in Havana says the recent elimination of the use of the U.S. dollar as a hard currency in Cuba, and the rollback of modest economic reform measures, such as self-employment opportunities, is making life more difficult by the day for ordinary Cubans. 

"Many Cubans without access to hard currency do not regularly get three square meals a day," he said. "The ration card only provides about 10-days sustenance, and the rationed food supply is erratic. One ration-store shopkeeper took to referring to eggs as 'Americanos.' Why? Because the government always says the Americans are coming, but they never do."

Cason says in the countryside, most Cubans eat once a day and he quotes U.N. reports as saying there is substantial under-nourishment and malnutrition.

The U.S. diplomat spoke at a conference in Miami examining a transition to a democratic Cuba. 

Cuban authorities banned the use of the U.S. dollar last month, ending a 10-year period in which it served as the de-facto currency on the Communist-run island.

From now on, Cuban-exiles sending money to relatives must also pay a 10 percent commission when exchanging dollars for so-called "convertible" pesos, which are pegged one-to-one to the U.S. dollar. 

Analysts say the Cuban action is, in part, an effort to obtain scarce hard currency reserves. 

Cason says more Cubans are trying to leave their island. He says the U.S. issues 20,000 visas a year to Cubans, but those who choose to leave illegally, are often the talented young professionals that any country needs for its future. 

"We discovered an interesting demographic among those who choose to leave illegally," he said. "It is not the youngest Cubans who despair of making a life for themselves, but those in the late 20s or early 30s. Educated with no job prospects. Married and living at home." 

The U.S. diplomat says many Cubans are waiting for a so-called "biological solution" to their misery — the death of Cuban leader Fidel Castro. He says Castro's recent fall in which he fractured his knee and arm has only heightened anticipation of a post-Castro Cuba, even among the Cuban leaders' followers. 

"The lonely voices in the opposition are getting less lonely by the day," he said. "Fed up by food and power shortages, and the latest government-
imposed crises, Cubans are increasingly losing patience with Castro. In the weeks since Castro's well-publicized fall, more and more regime supporters are now saying it is time for Castro to step down." 

Cason says it is unlikely that Cuba will transform itself into a democracy the day Castro dies. He says Cuban authorities have already planned a transition aimed at perpetuating Communist rule. The U.S. diplomat says a generation-long effort will be needed to bring democracy to an island that for nearly 50 years has known nothing but communism.

Newswoman murdered covering Nicaraguan municipal elections
By the A.M. Costa Rica wire services

JUIGALPA, Nicaragua — A Nicaraguan journalist has died after being shot in the chest in a dispute outside a polling center where votes from Sunday's municipal elections were being counted.

María José Bravo, a correspondent of the newspaper La Prensa, was killed Tuesday after leaving the center here, some 140 kms. (87 miles) southeast of Managua, and wandering into a fight between 

followers of rival political parties. She leaves a child, 3.

A former mayor of the city of El Ayote was among three suspects taken into custody in the shooting, which authorities say was the only violent incident. 

Although a final vote count has not yet been released, the leftist Sandinista National Liberation Front appears to have won the majority of the 152 mayoral seats at stake.

Japan's Parliament ratifies free trade treaty negotiated with México
By the A.M. Costa Rica wire services

TOKOYO, Japan — The  parliament has ratified a free trade agreement with Mexico. The accord, which was signed last September by Japanese Prime Minister Junichiro Koizumi and Mexican President Vicente Fox, must still be ratified by Mexico's 

legislature. The measure is in the hopper now.

The trade accord promises to widen Japanese export opportunities in Mexico and the United States, and aims to reduce Mexican dependence on the United States for export sales.  About 90 percent of Mexico's exports go to the United States.

Jo Stuart
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