VZCZCXYZ0006
PP RUEHWEB

DE RUEHSJ #0979/01 1292340
ZNR UUUUU ZZH (CCY ADCA947E MSI7323-695)
P 092340Z MAY 06 ZDS
FM AMEMBASSY SAN JOSE
TO RUEHC/SECSTATE WASHDC PRIORITY 4932
INFO RUEHZA/WHA CENTRAL AMERICAN COLLECTIVE

UNCLAS SAN JOSE 000979 
 
SIPDIS 
 
SIPDIS 
 
(C O R R E C T E D C O P Y - PARAS RENUMBERED) 
 
E.O. 12958: N/A 
TAGS: PGOV PREL CS
SUBJECT: ON INAUGURATION DAY, OSCAR ARIAS PROMISES A 
GOVERNMENT THAT WILL MAKE DECISIONS 
 
REF: A. SAN JOSE 159 
     ¶B. SAN JOSE 204 
     ¶C. SAN JOSE 444 
 
Summary 
-------- 
¶1.  Oscar Arias was sworn in as president for a four-year 
term beginning May 8.  Present at the mid-day ceremony were 
the heads of state of the Central American countries, Mexico, 
Colombia, Ecuador, Haiti, and Taiwan, Prince Felipe of Spain, 
First Lady of the United States Laura Bush, and former Polish 
President Lech Walesa.  Arias gave an inspirational speech 
with a simple line that clearly contrasts his style of 
leadership with that of his predecessor:  "We must make 
decisions."  The full text of the speech in English will 
follow septel.  End summary. 
 
Breaking With the Immediate Past 
-------------------------------- 
¶2.  On May 8, Costa Rica may have entered into a new era. 
The administration of Abel Pacheco (2002-06) was notoriously 
without direction, vision, or discipline.  Pacheco's handling 
of the U.S.-Central America-Dominican Republic Free Trade 
Agreement (CAFTA-DR) was emblematic of a government that was 
fearful of the opposition and therefore refused to take 
action.  Pacheco delayed 14 months before submitting CAFTA-DR 
to the legislature for ratification and then encouraged 
further delay after submission.  He also failed to introduce 
necessary implementing legislation so that CAFTA-DR could 
enter into force.  He constantly made contradictory public 
statements about CAFTA-DR, expressing doubt that the 
agreement would benefit the poor but, more recently, saying, 
"Without CAFTA-DR we will starve." 
 
¶3.  In contrast, Arias and his government team appear to have 
definite ideas on what they hope to accomplish and how to do 
it.  The first positive step was made even before May 8 when 
Arias's National Liberation Party (PLN) forged a legislative 
plan with the smaller Libertarian Movement Party.  This 
informal and ad hoc coalition will work together on CAFTA-DR 
ratification, tax reform, and in other areas with the likely 
support of the five-deputy Social Christian Unity Party 
(PUSC) and that of two other deputies.  All together, this is 
a large enough majority to push through most of Arias's 
ambitious legislative agenda. 
 
A Call For Practicality and Decisiveness 
---------------------------------------- 
¶4.  After being presented the presidential sash, President 
Arias laid out for the nation what he believes to be the 
principle challenges of the next four years.  His speech in 
the National Stadium was of course televised and then 
published in newspapers the following morning.  The daily 
newspaper "La Nacion" captured the most noteworthy line in 
Arias's speech in its May 9 headline:  "We must make 
decisions."  Arias used those exact words twice and repeated 
the idea several times in different ways.  He said that for 
years Costa Ricans have chosen to rest on their laurels and 
chosen "indecision as a method to deal with life...We cannot 
continue to wander without direction, discussing endlessly 
amongst ourselves, chasing the illusion of unanimity, using 
up the best of our days and our efforts as if time did not 
exist and as if the march of history would stop to wait for 
tiny Costa Rica to weigh anchor."  This was perhaps the most 
pointed comment in the speech, a criticism of Costa Rica's 
political culture which is best personified in Arias's 
immediate predecessor, Abel Pacheco. 
 
¶5.  Arias also criticized Latin America politicians and 
intellectuals in general who "continue to chase after utopias 
and then blame others for our failures" and who "have a 
chronic inability to see reality as it is, not as we wish it 
to be, and are unable to read the world in prose and not in 
poetry." 
 
Making Costa Rica a Developed Country 
------------------------------------- 
¶6.  Arias said that if there is a consensus in Costa Rica on 
anything, it is that "the status quo is not an option."  He 
said that his first task as president begins today -- "to 
define a direction for Costa Rica and start navigating in 
that direction."  He then laid out a program for his 
government that he admitted was long term and would reach its 
culmination only 15 years hence on the country's bicentennial 
anniversary of independence; by that time, he said, Costa 
Rica will be able to join the ranks of the international 
community as "a developed country."  (Note:  In previous 
speeches and in comments to us, he said that the goal was to 
be the most developed country in Latin America.  Such a 
cocksure statement would have been offensive to the heads of 
state from neighboring countries in attendance.) 
GOVERNMENT THAT WILL MAKE DECISIONS 
 
¶7.  The first agenda item Arias mentioned was "the struggle 
against poverty and inequality."  That could be done, he 
said, only by "stimulating the creation of formal jobs in the 
private sector" and by "reforming and adequately regulating 
telecommunications, energy, and infrastructure so that they 
are competitive internationally."  Though never mentioning 
CAFTA-DR, Arias warned, "To return to protectionism or to be 
disdainful of foreign investment nowadays is the surest path 
to condemning our youth to unemployment and Costa Rica to 
underdevelopment...A country that fears the world and cannot 
adapt itself to outside forces inevitably condemns its young 
people to seek well-being beyond its borders...It will not be 
my government, either out of fear or prejudice, that isolates 
Costa Rica from the international economy." 
 
Need for Public Investment 
-------------------------- 
¶8.  Arias declared, "I want to be emphatic on the following: 
in this administration we will resolve the perennial fiscal 
crisis of the Costa Rican state."  (Note:  He offered no 
details about how he would do it.)  There would be new and 
significant investments in infrastructure so that "never 
again will our roads, ports, and airports be cause for 
national shame; never again will we condemn our producers to 
pass through a nightmare to sell the fruits of their labor." 
Arias promised to strengthen public education and public 
health care, making every effort possible in the next four 
years to increase government spending on education to 8 
percent of GDP.  His government will "universalize" secondary 
education by providing stipends to the poorest families so 
that they can keep adolescents in the classroom.  Arias said 
his government will "fight narcotraffickers without rest, not 
only by patrolling our waters and guarding our airports, but 
especially by dealing with the traffickers on our street 
corners, in our parks, and in front of our schools." 
 
An International Debt-Forgiveness Proposal 
------------------------------------------ 
¶9.  On foreign policy, Arias stressed Costa Rica's 
traditional "defense of democracy, full enforcement and 
promotion of human rights, the struggle for peace and global 
disarmament, and the search for human development."  He said 
his government will be committed to "multilateralism and 
strict adherence to international law."  He warned that the 
big issues of our time, such as "a civilized coexistence 
between peoples constantly buffeted by political and 
religious fundamentalism and by the weakening of 
international law," will not be resolved "automatically." 
 
¶10.  Arias expressed his major international initiative as 
follows:  "As a country without an army, from today we call 
upon the world, especially the industrialized countries, that 
they all give life to the 'Costa Rica consensus.'  With this 
initiative we aspire to establish mechanisms to forgive debts 
and support with financial resources those developing 
countries that every day invest more in health, education, 
and housing for the people and every day less on weapons and 
soldiers.  It is time for the international financial 
community to reward not only orderly spending, as has been 
done until now, but also ethical spending." 
 
Comment 
------- 
¶11.  There were several applause-worthy lines in Arias's 
speech, and Arias in fact received a lot of applause except 
from the 17 deputies of the Citizens' Action Party (PAC), the 
major opposition to the Arias government's agenda for the 
next four years.  (Note:  The PAC deputies' apparent decision 
not to applaud at all is perhaps a sign of what to expect 
from them in the future.)  The speech overall was well 
received; most Costa Ricans we have spoken with were proud of 
their new president whom they believed was eloquent and 
represented their country's most positive values.  Tomas 
Duenas, Costa Rican Ambassador to the U.S., with whom we had 
lunch afterwards, said the speech for him was "like a shot of 
adrenaline," and he couldn't wait to get back to Washington 
and go back to work. 
LANGDALE