President Laura Chinchilla
I don’t know if it is just me, but it seems like every time you turn around Costa Rica is having some sort of labor strike.
Last Monday, about 2000 union workers of Instituto Costarricense de Electricidad (ICE) (government monopoly on power and light company) went on strike, and snarled traffic on several major streets in and around San Jose. They were protesting a bill in the Legislative Assembly to privatize the generation of electricity.
And back in July a meeting was held between the union and officials of the Caja Costarricense del Seguro Social (CCSS) over a strike that centered on reduction of benefits.
So … what could this be telling us?
First, let go to the political party of National Liberation Party, in which ex President Óscar Arias (May 2006-2010) and current President Laura Chinchilla are political members. The National Liberation Party supports [to a point] privatization, which has only been tolerable by unions in this small but creditable Central American country. After Arias, many were saying [because of privatization] it would put an end to National Liberation Party’s, needless to say, they were proven wrong when Chinchilla was voted in, keeping the party in power until 2014. Its evident both were voted into power to help reduce government waste and to promote economical growth.
During Arias term and the negotiating of the Free Trade Agreement (signed in 2007) the country experienced massive union protesting that it would deplete many Costa Rica jobs.
Another one of Arias accomplishments was to initiate a plan to attract $860 million in foreign investments, including those “private” investors that would get involved in an “efficient” operation of the Limon port. For years (or decades it seems) Limon’s community leaders had also been seeking money for the redevelopment of the downtown area to help draw more tourist dollars. Anyone that has been to Limon, knows the town is in shambles and has one of the highest crime rates. Any improvement would be a huge bonus to Costa Rica’s economy.
Arias felt investors were the key and local business owners would never fork out money if any of them felt threatened by government red tape and bureaucracy. In a way that made sense; most people agree, ‘anything the government runs usually ends up costing taxpayers money.’
President Oscar Arias
Unfortunately, Atlantic Port Authority’s Workers Union (SINTRAJAP) did not see it that way, instead they claimed the government was trying to break the union with privatization so they sued and also claimed privatization constitute a threat to the nation’s sovereignty.
Chinchilla seems to be following in Arias footsteps by getting the unions pissed. First by granting a contract to the Dutch firm APM Terminals to construct a new port facility in Limon, which has enraged the longshoremen’s union and 2) now faced with major criticism on this privatization of electrical contingency bill which drew over 2000 union protesters last week.
One of the things that Costa Rica unions do have is votes and money. Additional support (and money) comes from the US like the AFL-CIO union in the United States. During the Limon strike, the International Longshore and Warehouse Union (ILWU) called on the U.S. government to take immediate action to stop Costa Rica’s attack on SINTRAJAP, and filed a petition with the Obama Administration against the government of Costa Rica under the Dominican Republic – Central American Free Trade Agreement (DR-CAFTA) for “serious and repeated failures by the government of Costa Rica to effectively enforce its own labor laws.”
Now with the proposed privatization of electrical, again the unions are being threatened but they in a sense are used to it. Back in 2003, ICE workers succeeded in blocking a privatization probe by the government. However, the big difference, the protesters were around 50,000, a far cry from the estimated 2000 people a week ago.
One thing for sure, not one Costa Rican or expats will dispute, the electricity in Costa Rica needs massive improvement – there is not a day goes by where there are power outages. With said, the union workers may have a uphill battle, especially when improvement are being seen everyday in the privatization of internet service.
So if it takes privatization to make life better, is that not a good thing for Costa Rica?
Port privatization should be an absolute NO NO. Recently Hutchison Port Holdings along with a company called The Carlyle Group proposed a deal to privatize the Port of Galveston, Texas (USA) and I for one am happy to hear the deal fell through. Their proposal was withdrawn for reasons unknown.
A port (as well as an airport or a railway system) are SERIOUS strategic areas and if compromised will “constitute a threat to the nation’s sovereignty.” These facilities bring in millions of tons of goods and not all it can be checked. A private operator could allow goods to come through that are in the best interest of the operator and not necessarily the public as a whole, or simply miss something that could be devastating.
With an ever growing threat from terrorist groups and regional drug cartels, it may be in the best interest of the Costa Rican government to abandon the idea.
I’m not so sure privatizing power generation is a good idea for any country. I would think that power generation would be considered a strategic and sensitive area because it provides energy to the masses, and if brought under seige, could bring a country to it’s knees. If the company running the utility doesn’t like the policies of the current administration? Boom boom, out go the lights. Food for thought.