VZCZCXYZ0005
PP RUEHWEB

DE RUEHSJ #1151 1451621
ZNR UUUUU ZZH
P 251621Z MAY 06
FM AMEMBASSY SAN JOSE
TO RUEHC/SECSTATE WASHDC PRIORITY 5174
INFO RUEHZA/WHA CENTRAL AMERICAN COLLECTIVE

UNCLAS SAN JOSE 001151 
 
SIPDIS 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: PINR PGOV PREL CS
SUBJECT: MARCO VARGAS, MINISTER WITHOUT PORTFOLIO 
 
 
¶1.  Marco Antonio VARGAS Diaz will likely play a key role in 
the Arias Administration.  Vargas is part of Oscar Arias's 
innermost circle of advisers.  His stated role is to serve as 
an inter-institutional coordinator and troubleshooter, 
charged with ensuring delivery on Arias's campaign promises. 
Vargas holds the only entirely new cabinet-level position 
created by the Arias Administration (two positions were 
eliminated and two others combined).  He will work out of the 
Casa Presidencial with a small staff from the Ministry of the 
Presidency and will free the Minister of the Presidency to 
serve as more of a Prime Minister, concentrating on 
legislative liaison, than Chief of Staff. 
 
¶2.  Born August 17, 1948, Vargas married Matilde Lorena RUIZ 
Baldioceda in 1970 and graduated from the University of Costa 
Rica with a degree in Economics and Social Science in 1976. 
Vargas, who has 35 years of experience in the industrial 
private sector, began his career in the family printing 
business (Imprenta y Litografia Vargas) where he currently 
serves as president.  Vargas founded his own packaging 
company (Empaques y Envases Centroamericanos) in 1986 and 
still serves as president and CEO.  Also in 1986, Vargas 
began a four-year stint as Vice President of a regional 
fertilizer company (FERTICA).  An active member of the 
Kiwanis Club, Vargas was selected by the Economic and Social 
Sciences Association as the 1993 Distinguished Private Sector 
Professional. 
 
¶3.  Vargas began his political career in earnest in 1991, 
coordinating a committee that explored Jose Maria 
Figueres-Olsen's chances for being elected President of Costa 
Rica.  Vargas then served as Treasurer for the Figueres 
Presidential Campaign.  When Figueres was elected in 1994, he 
named Vargas as Minister of Economy.  In 1995, the Ministry 
of Science and Technology was temporarily combined with the 
Ministry of Economy, and Vargas held both Ministries until 
1996 when he became Minister of the Presidency (similar to 
Chief of Staff) for the remainder of the Figueres 
Administration (1994-1998). 
 
¶4.  At the end of the Figures Administration, Vargas returned 
to private business but remained close to Figures who 
established the Costa Rican Foundation for Sustainable 
Development.  Vargas served as President of the Foundation 
and also served as Figueres's representative and spokesman. 
On October 27, 2004, Vargas publicly resigned both positions 
in disgust over revelations that Figures had received up to 
$900,000 in presumed kickbacks from French Telecom company 
Alcatel.  Around that time, Vargas, who shares a life-long 
National Liberation Party affiliation with Oscar Arias, 
became actively involved in the Arias campaign. 
 
¶5.  PLN insiders and other observers expressed initial 
surprise that Vargas was given an apparently low-profile 
position in the Arias Cabinet.  However, recent signs 
indicate that although Vargas's role is behind the scenes, he 
will be a key adviser.  Recently the head of the 
semi-autonomous Water Administration presented his 
recommendations for legislative reforms to Vargas instead of 
directly to the Legislative Assembly as has been past 
practice.  This is a major change since it implies that even 
the heads of major telecommunications and insurance entities, 
who will play a crucial role in the debate over the Free 
Trade Agreement, will be coordinating their legislative 
proposals through Vargas's office. 
LANGDALE