• Costa Rica Real Estate

Political divisions hamper Costa Rica’s reform efforts

December 21, 2011

The Legislative Assembly has been one of 2011’s most active news providers. An unexpected political coalition helped set the tone early for the rest of the year, and made Congress the subject of many headlines this year. 

It was also a historic year for Costa Rica’s legislative branch. On May 2, Costa Rica’s ruling party, the National Liberation Party (PLN), lost majority control of the assembly when opposition parties formed a pact called “Alianza por Costa Rica” (“Alliance for Costa Rica”), and voted in one of their own as assembly president. It was the first time since 1966 that the head of the assembly was not a member of the ruling party. 

After two days of political instability and chaos, Juan Carlos Mendoza from the Citizen Action Party became assembly president, voted in by members of the Libertarian Movement Party, the Citizen Action Party (PAC), the Social Christian Unity Party, the Broad Front Party, the Access Without Exclusion  Party,  and  the N ational Renovation Party. 

But the behind-the-scenes antics caused many Costa Ricans to become dismayed at the process, and average citizens began calling the assembly a circus. President Laura Chinchilla did not deliver the president’s annual state of the nation speech, a traditional May 1 activity. 

In September, the alliance suffered a setback. Ottón Solís, a presidential candidate from PAC, broke from the opposition bloc and began negotiating a fiscal reform bill with Chinchilla’s administration. PAC and PLN lawmakers voted to put a modified version of the bill on a fast track for approval. 

Divisions over the reform bill continued to the end of the year. 

Meanwhile, voters quickly became disenchanted with lawmakers. When the opposition alliance was formed, 57 percent of Costa Ricans said they supported it, according to the daily La Nación. By October, 70 percent of Costa Ricans said the legislative opposition group had done nothing to improve the assembly’s productivity.

Although lawmakers have been working on several pieces of legislation, including a transit bill, an anti-smoking bill, a medical research bill, a liquor license bill and a tourism bill, none of them were called up for a vote this year. 

The transit and anti-smoking bills were discussed in full sessions of Congress, but progress was stopped short as focus shifted to tax reform and the government’s 2012 budget, which was approved at the end of November. 

Chinchilla pressed lawmakers to vote on tax reform by the end of the year, but political divisions have stalled negotiations, making a deal unlikely until at least early 2012.

The Legislative Assembly was also hit by scandal this year, as PLN lawmaker Jorge Angulo faces charges of fraud, extortion and influence peddling in an investigation by the Chief Prosecutor’s Office. Angulo is accused of allegedly extorting a kickback from construction company COINKRJ, S.A., which had been granted a concession to build the Italian-Costa Rican High School in San Vito de Coto Brus, in southern Costa Rica. 

As the year came to an end, lawmakers discussed removing Angulo from his seat in the assembly pending an outcome in the case. 

Chinchilla has also had a difficult year, changing the composition of her Cabinet five times in the first 15 months of her administration. In July, Health Minister María Luisa Ávila – the country’s most popular minister, according to polls – resigned over disagreements with how the crisis in Costa Rica’s Social Security System (Caja) was handled. Daisy Corrales became the new health minister. 

Eduardo Doryan also resigned as executive president of the Costa Rican Electricity Institute (ICE), after public criticism of his past management of the Caja. After Doryan’s resignation, former Environment Minister Teófilo de la Torre was shifted to ICE. 

René Castro, who was Costa Rica’s foreign minister at the time, was reassigned to the Environment Ministry, and Enrique Castillo became the country’s foreign minister. 

President Chinchilla, elected in 2010 on a platform of improving public security, has made only limited gains on the issue this year. In a May speech, the president said that implementing her administration’s strategy to fight crime would depend on the assembly’s ability to generate more government revenue through tax reform. 

At the 100-day mark of her administration on Aug. 19, Chinchilla had a 40 percent approval rating, down from 76 percent in September 2010. The president’s poll numbers have continued to drop through the end of the year.

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