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TODAY'S CONTENTS
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*Feature Article: Pacheco in More Trouble
*News Digest

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FEATURE ARTICLE
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*President Pacheco in More Hot Water

President Abel Pacheco continues to be on the heat seat following several

admitted irregularities over the receipt of a lifetime membership to a luxury

club in the Dominican Republic and free airline tickets by the TACA Group

airline.

Now, there is a question on how, Bernardo Martín Moreno, the president of the

Immobiliaria Somersen, a real estate company in Sevilla, Spain, came to be

Costa Rica's honorary consul in Sevilla. Moreno is also the president of the

Martín Robles foundation that dedicates time and money to art and culture.

In April of 2004, the President, accompanied by his wife and chief protocol

officer at Casa Presidencial, Jorge Arce, and former Tourism Minister, Rubén

Pacheco, travelled to Sevilla for a private vacation where they met with the

businessman.

In July of 2004, Bernardo Martín Moreno founds in Costa Rica the corporation

Somersen Costa Rica SA, of which he is president and Fernando Pablo Méndez,

another foreigner is vice-president.

In less than a month, Bernando sends a letter to director of the Golfo de

Papagayo (Guanacaste) expressing his intention for the Somersen company to

participate as a partner in the Enjoy Hotels and Resorts, who is represented

by former minister Rubén Pacheco.

The project, based on the representation by the former Tourism minister, is

to build a residential community, hotel and an 18 hole golf course.

And it is at this time that Bernardo Martín Moreno is named as honorary

consul in Sevilla, Spain, as it is listed in the Foreign Ministry's website

of official consuls. The naming of Bernardo was confirmed by protocol chief,

Jorge Arce.

Five months later, in December of 2004, President Pacheco decides to visit

Spain again for his holiday vacation to announce the introduction of his new

book "Poemas y cuentos" which was published free of charge by the Martín

Robles foundation, headed by Bernardo Martín Moreno.

So, now, Bernardo is not only a real estate businessman in Spain, but also in

Costa Rica who has expressed an interest for a state owned concession (the

Papagayo project is under strict government control) and is also the honorary

consul for Costa Rica in Sevilla.

Accompanying the president in the December trip is again protocol chief Arce

and former minister Pacheco, who will could soon be Bernardo's partner. And

the former minister, notwithstanding that he had resigned his post at

Tourism, was still participating in government economic consulting sessions

and as an assistant to the president.

The December trip is also when president Pacheco decided to head to the Grand

Cayman islands, where he spent Christmas, following his book launching in

Spain. And it is this trip that raised the question of the TACA flight that

took him from San José to Miami and back that was not paid for by the

president, but donated by the airline to the government.

In mid-January of this year, the powerful public workers union, ANEP, sends

president Pacheco a strong letter asking for explanations on the financing of

his book and the business at Papagayo.

The ANEP letter heavily criticizes the foundation that published the book and

the negotiations of Rubén Pacheco and his role in getting a government

concession at the Papagayo project.

Notwithstanding the letter, and that the ANEP in October of 2004 had charged

that there was influence peddling going on at Papagayo, President Pacheco

only defended his book publication, saying that it was the Ateneo de España

that promoted the book and arranged for the illustrations and the

publications, all at no cost and has said nothing about the rest.

The situation is starting to look bad for the president, because in March of

this year, records show that a new company was formed in Costa Rica -

Somersen Enjoy SA - with lists Rubén Pacheco as president of the corporation

and Bernardo Martín Moreno as chief operating officer.

Making matters even worse is that Jorge Arce, Pacheco's chief protocol

officer, and who accompanied him on both trips to Spain, maintains a

professional connection to Bernardo Martín Moreno.

Arce acts as legal counsel for the Spanish businessman.

Though his protocol chief assures that there is no conflict of interest

offering his legal services to the president of Somersen and the foundation

that published president Pacheco's book.

Arce also insists that he has provided no services with respect to the

Papagayo project and the concession and insists that the professional

relationship is new.

Rubén Pacheco defends the role of Bernardo as a good businessman, meanwhile,

the President Pacheco continues to duck the issue, refusing to make things

clear.

His press secretary, Carolina Murillo, advises that a statement will be made

soon by the president on the matter.


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NEWS DIGEST
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*Arias Would Win the Vote But Not the Election, Poll Shows

A recent poll by Borge y Asociados, puts Óscar Arias, presidential candidate

for the Partido Liberación Nacional (PLN) clear ahead of his rivals with a

difference of some 17 percentage points.

The poll was taken between May 13 and May 20 with more than 400 adults from

all over the country interviewed. The results have a margin of error of 5

percentage points.

One of the questions put to the people was: who would you vote for if the

elections where held today? 46.1% said they would decline to cast their vote,

while 25.7% said they would vote for the Liberacionista (Arias).

Partido Acción Ciudadana (PAC), Ottón Solís got a 8.7% response, while

Ricardo Toledo, of the Partido Unidad Social Cristiana (PUSC), a 5.6%.

Antonio Álvarez Desanti, of the Unión para el Cambio (UPC) got 4.1% and Otto

Guevara, of the Movimiento Libertario, was last at only 3.3%.

Notwithstanding that Arias would today win the vote from among those decided

to vote, he would not win the election, not reaching the required 40% of the

majority vote as spelled out in the Código Electoral - Elections Code.

Some experts say this election campaign will be very interesting, as most

candidates have no real identity to their parties.

This election a high number of young voters are expected to participate in

the election, who have no identity to a party or historic grouping of the

traditional politics for the "red" and "green" parties, the two parties that

have exclusively ruled politics in Costa Rica until the 2002 elections.

The scandals and accusations of corruption could also influence the vote, as

two former presidents (Calderón and Rodríguez) are under house arrest and the

current president on the hot seat over irregularities, belong to the same

party - the PUSC - and another former president (Figueres) has refused to

return to Costa Rica is for the PLN. For now, it seems that the Figueres

thing is all forgotten, but it could play a role in the election campaign

against the PLN.


*Buying a Used Car in Costa Rica Can be Tricky Business.

Making sure that the vehicle is mechanically sound, that all the accessories

work, there are no leans registered against the vehicle and that ownership

and registration is good are just part of a sound purchase

However, an additional requirement is needed - driving around to make sure

the vehicle you are intending to purchase is the only one on the road. Uh?

that the vehicle is not "twinned".

Such was the scope of an investigation by the Unidad de Robo de Vehículos del

Organismo de Investigación Judicial (OIJ) that took several months to

complete and came up with 15 "twinned" vehicles, which investigations believe

is only a small amount of the real number of duplicated vehicles circulating

on Costa Rican roads.

The investigation began in December when records show that several different

people were paying for the Marchamo - the he right of vehicle circulation

which is paid annually - for the same car and in more than one case at the

same time, leaving authorities to believe that there were two or more

vehicles circulating with the same license plate and original registration

documents.

"Twinning" is when two or more vehicles are circulating with the original

registration documents issued by the Instituto Nacional de Seguros (INS). The

documentation continues with the RTV, the annual vehicle inspection and the

ownership card issed by the Registro Nacional.

Investigators say that the 15 vehicles confiscate by the OIJ were purchased

by their current owners at a low price from uknowns who'se sales pitch was of

a distress sale. Sellers of "twinned" cars take advantage of those who are

looking for a "deal" on a used car and don't take the time for due diligence.

Authorities advise that before buying a vehicle they should double check the

vehicle's registration and purchase only from known persons (take down the

identification of the person selling the car, phone number, as much

information of the seller as possible) or from registered car lots, to avoid

losing money in possibly buying a "twinned" vehicle.


*Tamarindo Spoils Customers with Bank Offer

Banking, once the bane of every Tamarindo resident and tourist alike, is

about to spoil them with choice.

Four banks are currently fighting for locations in Tamarindo, and the

competition is heating up for offices in completed shopping centers.

BAC San José, Banco de Costa Rica and Banco Cuscatlán will all be moving into

Tamarindo to rival for a share of the financial services market, including

account management, loans and commission-based transactions.

Until now, Tamarindo and area residents have had to make do with a single

branch of the Banco Nacional to service all of their financial transactions,

as well as those of the thousands of tourists the town draws in, often daily.

In January, Banco de Costa Rica announced they would be opening a new branch

in Tamarindo in response to the 'exponential growth' in the volume of

business the town was generating, and following the success of their Flamingo

branch.

This week Edelberto Leal, Regional Chief for the Banco de Costa Rica (BCR),

confirmed the Tamarindo branch would open in August.

"We have the personnel but we want to do some further training," he says.

"They are qualified and bi-lingual and are mostly from Santa Cruz. We also

have a girl from Nicoya."

Mr Leal also confirmed BCR had found a location, but not the one it had

wanted.

BAC San José, the second largest private bank in Costa Rica and a subsidiary

of BAC International Bank, apparently beat them to the punch, recently

unveiling a branch in the newly-built Plaza Conchal in Tamarindo, much to the

chagrin of Mr Leal.

"I had been negotiating that space for a long time and it is the one we

wanted," he said. "Being a State bank we have to go through a process, but

private banks can make this decision quicker."

He confirmed that BCR will occupy another, larger space towards the back of

the shopping plaza.

BAC San José currently has 31 branches in Costa Rica. The Tamarindo branch

will be its second in Guanacaste, after Liberia.

The privately-owned Banco Cuscatlán has also confirmed that they will be

opening a new branch in Tamarindo, but would not reveal the location, nor a

scheduled opening date.

Regardless, the news of four banks where there used to be one, is likely to

come as good news for much of Tamarindo�s population.

In the past, even simple transactions such as cashing a check could take up

to an hour, with only three tellers to process the volume of customers filing

into the branch. Since Internet banking in Costa Rica is not yet equipped to

allow transfers between different banks, businesses were often forced to open

a second bank account, with the second branch up to 30 minutes away.

"We will have to wait and see," says Jorge Contreras of Client Services for

Banco Nacional in Tamarindo, in response to questions of the fresh

competition. " I am sure some people will go and experiment in other banks."

Banco Nacional, which since its arrival into Tamarindo in 1999 has had a

monopoly on the banking services in the area, is examining ways of

maintaining its share of business in the face of new competition, including

reinstating their loans service, which had ceased eight months ago.

"We have re-introduced loans for small businesses, for housing," confirmed Mr

Contreras. "This includes foreigners if they have residency, and can

demonstrate they are living here."

"Banco Nacional continues with the idea of expanding its services," he added.

"There was the possibility that we would move to a bigger space, but the

negotiations fell through. For the time being we are staying where we are."


*Pressured, Bolivian President Refuses to Resign

The administration of Bolivian President Carlos Mesa asserted he would

continue in his post, despite entrepreneurs, politicians, radical leaders and

even two insubordinate officers have asked him to resign.

Demands are ironically multiplying following two months of Mesa´s resignation

request to the Congress, which did not accept it.

Thus, he proposed to hold elections in advance to try to leave the

presidency, but once more, the entity turned down his decision.

On the issue, Presidency Minister Jose Galindo made it cleared that Mesa

would remain in the post until his mandate ends.

The president is governing and will govern until August 6 2007, as stipulated

by the Constitution, noted Jose Galindo in response to assessments by the

Bolivian Business Confederation and the Industry and Trade Chamber of the

city of Santa Cruz, which said Mesa should resign and call for advanced

elections if he is not unable to govern and re-establish order.

Members of the Nationalist Democratic Action Party, of former dictator Hugo

Banzer, and the National Union, of wealthy entrepreneur Samuel Doria Medina

considered Mesa´s resignation would resolve the situation.

On Wednesday, two officers who were expelled from the army for

insubordination also asked the current statesman to resign.

Congress President Hormando Vaca Diez (Social Democracy Party) only said Mesa

had to use his powers because the country faced a chaos.

Amid this panorama, the Revolutionary Nationalist Movement, of ex president

Gonzalo Sanchez de Lozada, urged Mesa to call a state of siege, while

Movimiento al Socialismo (Movement to Socialism) leader Evo Morales expressed

his concern about stepped-up pressures for Mesa´s resignation, which he

considered that would not resolve the crisis.

Morales said the crisis could only be solved through a constituent assembly.

Meanwhile, people´s organizations informed their protests, which started on

May 16, would continue until next Monday, when more people will incorporate

to them.

Bolivians have been demanding to call to a constituent assembly and

nationalize or regain the hydrocarbon control.



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