Port Authority Under Pressure
Joaquín Vargas sits at his desk in his Atlantic Port Authority (JAPDEVA) office, where he has worked for the past 34 years. Despite his desire to continue managing the Atlantic port of Moín for another 30-odd years, his believes the outlook for JAPDEVA as the manager and operator of the Caribbean ports of Moín and Limón is grim.
I think most of us have come to realize that the ports will end up being privatized, now it s more a question of when and under what circumstances, said Vargas.
Eighty percent of Costa Rica s foreign trade passes through Limón and Moín, and over the past few years, national pressure to develop and modernize the ports has intensified. Plans for the creating the necessary infrastructure have been drawn up, and are about to get underway. At bottom, these plans will require inviting the participation of foreign investors and operators, placing the role of JAPDEVA in doubt.
Foreign Investors Listen In
At a meeting on Jan. 27, the Public Works and Transport Ministry (MOPT) hosted interested parties to propose terms for building and operating the port facilities at Limón and Moín.
The terms called for the specialization of the operation of each port, with Limón serving as a hub for cruise ships, while Moín would be dedicated to handling cargo. Both would require substantial construction and investment, and with activities planned for as far ahead as 2030.
The price tag on the project is estimated at $800 million over the span of the project. Companies from Holland, Chile, China, Singapore and the United States were among those who attended the conference. And despite obvious interest from numerous parties the potential investors appear likewise unwilling share control of the project or its profits with JAPDEVA, which has operated the port since 1963.
Joaquín Vargas is a principal supervisor for the Moín port. He was born in Limón, has lived there all his life and intends to stay there until the end of his days. He realizes the complexity of the privatization issue and admits if the port was privatized, it probably would run more efficiently.
Sure it might be a bit more efficient, that s what private industries do they look to be more efficient for a lesser cost, implement regulations to attain their goal, and anyone or anything in their way is disposable. Vargas said it s too bad it s come to this point.
Any project we want to accomplish in this country needs the lending hand of outside countries, that s what it comes down to, said Vargas.
He said he was surprised none of the foreign investors accepted the offer to work in conjunction with JAPDEVA. They said … if they were going to invest so much they didn t need any obstacles, said Vargas. Basically, they wanted all or nothing.
City-Port of Limón Project
While no one as yet has offered the financing for the $800 million port renovation project, other, less expensive, projects could be underway within the next month.
The City-Port of Limón project aims to revitalize the city of Limón and help the community prepare for the modernization of the port. The World Bank has offered a $72.5 million loan towards the project s $ 80 million price tag, while the Costa Rican government has agreed to cover the rest.
The project will be presented in the legislative assembly on March 10 for first debate, and according to legislator José Luis Vásquez from Limón, the law will certainly pass, as only a handful of legislators are opposing it.
Limón needs this, said Vásquez, it would be the second most important development in Limón after the creation of JAPDEVA.
The project s four components include the revitalization of the urban area, local economic development, strengthening the municipality and supporting the development of the two ports. Despite the magnitude of the project and Costa Rica s dire need for new port infrastructure, there is no direct aid for improving the infrastructure of the port in the loan package.
According to the Global Competitiveness Report 2007-2008 of the World Economic Forum, Costa Rica ranks 125 out of 131 countries in terms of port infrastructure, lagging behind Panama, Honduras, Guatemala, Dominican Republic, El Salvador, Mexico, and Trinidad and Tobago.
JAPDEVA s Conflict
The Costa Rican government has been in negotiations with JAPDEVA s union since August 2008. The latest attempt was a severance package for all the employees offered in October 2008, which was unanimously rejected.
JAPDEVA has 1,400 full-time and 600 part-time employees, and according to their union representative Leroy Perez, employs approximately 10,000 indirectly.
I don t know what would happen to all the JAPDEVA employees if they privatize, said Vargas. A lot of these people have been doing these jobs their whole life, and they don t have the skills to just switch to another job domain.
When three JAPDEVA engineers were asked whether they thought there was potential for a positive outcome concerning the conflict over the privatization of the Limón ports, they simultaneously rolled their eyes.
One of the engineers, Greivin Villegas, said that aside from obvious job losses, he s worried about the consequences for Limón if a foreign investor comes in.
We here at JAPDEVA are all part of the Limón community, so we obviously want what s best for our families and neighbors, said Villegas. But when foreign investors come in, they don t have that connection with the area and might not feel as accountable for their actions.
Villegas emphasized that they were not at all against the betterment of the port, just the privatization factor, but he doesn t feel there s much hope.
They are determined to buy us off, said Luis Vargas, another engineer, but there s a lot invested in this company, and putting a price on us would be like hiring a really expensive prostitute.
Compensation Last Resort
According to Perez, that very high price would be half a million dollars per employee, but only as a last resort.
We are still defending JAPDEVA and we will fight for it, said Perez. At this point, after so many years, we are a part of Limón, not just a business.
The JAPDEVA union held a meeting on Feb. 19 with at least 60 different unions nationwide to discuss options for preventing the privatization of the port. They are also looking to international union organizations and have already had responses from the International Transport Workers Federation and the International Dockworkers Council.
Vasquéz believes there is a better solution for everyone involved, and instead of accepting and declining offers, the workers and the government need to actually sit down at a meeting and discuss possibilities.
It s for the sake of everyone in Costa Rica, said Vasquéz. The only loser in this type of conflict is the country itself, because if the port stops working, so does the economy.
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