San José, Costa Rica, since 1956

Ambassador Dueñas: One Year in Washington

WASHINGTON – What an irony itwould be if Central America rings in NewYear’s Day 2006 with the birth CAFTAand Tomás Dueñas isn’t invited to theparty.Dueñas, after all, is Costa Rica’sambassador to the United States, a successfulbusinessman and one of the mostardent supporters of the Central AmericanFree-Trade Agreement with the UnitedStates inside the Beltway. He told TheTico Times last year before taking officethat the passage of CAFTA was his mostimportant goal as ambassador (TT, Sept.17, 2004). But although Dueñas has beenlobbying for the agreement for nearly ayear as ambassador, and set the stage for ityears ago as Costa Rica’s Foreign TradeMinister, Costa Rica – the only signatorycountry that has not ratified the agreement– faces the prospect of being left out in thecold when CAFTA takes effect among theother signatory nations on Jan. 1, 2006(see separate story).This possibility concerns Dueñas, whonever held any diplomatic position beforebeing appointed to replace Costa Rica’sprevious ambassador in Washington,Jaime Daremblum.“I think CAFTA can help Costa Ricanot only consolidate a market we’ve beenable to develop, but also take a leap forwardand become even more competitive,”he told The Tico Times. “The UnitedStates stands for democracy, liberty, tradeand stability. By providing the regionopportunities to enter its market, theUnited States is giving our region themeans to become more democratic andmore stable through trade. That is good forall of us.”DUEÑAS, 56, sat down with The TicoTimes for an interview last month over acup of strong Tarrazú coffee, in a sparselydecorated office void of the clutter ofmedallions, framed photographs and souvenirsusually found in Washingtonembassies.“I visit other ambassadors often, andthey always have all types of mementoesreminding themselves who they are,” hesaid. “I’m a businessman. I don’t believein that.”The child of a Costa Rican mother andan Ecuadorian father, he was born in theUnited States and raised in both LosAngeles and Costa Rica. He has a businessdegree from the University of Miami andhas taken graduate courses at Columbia,Stanford and the University of Pennsylvania’sWharton School.Dueñas served as Minister of Economy,Industry and Commerce (1998-2000) and later as Foreign Trade Minister(2000-2002), a position in which he participatedin the launching of the currentround of trade talks for the World TradeOrganization (WTO), the Doha Round,and helped lay the groundwork forCAFTA. Dueñas has also served as presidentof the Costa Rican Investment Board(CINDE) and on the board of directors ofCosta Rica’s Foreign Trade PromotionOffice (PROCOMER).He owns Esco S.A., a Costa Ricabasedengineering services company withoffices in Panama, Nicaragua, PuertoRico, Trinidad and El Salvador, and ismarried to Diana Chavarría.DUEÑAS oversees the tiny CostaRican Embassy on S Street, right offWashington’s Dupont Circle. He says theembassy employs only 10 people “includingthe gardener.“At first, it was awkward to representmy country, having never been an ambassadorbefore,” he conceded, though hecites his appointment as a sign of CostaRica’s dedication to CAFTA.“When I took the job (of Foreign TradeMinister), we only had two trade agreementsin place, with Central America andMexico. By the time I left, we had six:those plus agreements with Chile, theDominican Republic, Canada and theCaribbean Community (CARICOM),” hesaid proudly. “Eventually, on my watch,we came to Washington to propose whatbecame CAFTA. The fact that I’m hereshows Costa Rica’s commitment to thisprocess. They sent the person who is probablyone of CAFTA’s most importantadvocates.”Once CAFTA takes effect, 95% of theproducts that Central American membercountries export will immediately beallowed to enter the United States dutyfree.Likewise, about 80% of U.S. productswill enter Central America duty-free.In Costa Rica’s case, exemptions include“sensitive” products such as potatoes,onions and rice.DUEÑAS said certain industries inCosta Rica will particularly benefit fromCAFTA. One is the microchip sector,dominated by high-tech multinationalIntel, which has a plant northwest of SanJosé. Other sectors likely to get a boostfrom CAFTA are textiles, apparel, medicaldevices, ornamental plants and foodexports like beef, he said.Asked about opposition to CAFTA inCosta Rica, Dueñas said that “people arealways reacting to change, and the oppositionhas been quite vocal. And there willbe change. CAFTA will open up monopoliesthat have been in the hands of the governmentfor 50 years.”As to some CAFTA opponents’ argumentthat the 11-year-old North AmericanFree-Trade Agreement (NAFTA) hasmade things worse for Mexicans, particularlythose living in poverty, Dueñas suggeststhat this effect has more to with theMexican government’s shortcomings thanwith the trade pact itself – echoing theargument of many CAFTA proponents inCosta Rica, who say it’s up to the government,not a trade agreement, to make surewealth is distributed fairly.“You have to compare the standards ofliving of today’s Mexican with the standardsof living in Mexico before NAFTA.There is no question that there’s been quitean advance. That the advance has not coveredeveryone is a different story, but it’snot NAFTA’s fault,” he said. “This is atwo-way relationship, a commitment tosend products but at the same time a commitmentfor institutional reform.”PART of Costa Rica’s slowness to ratifyCAFTA, according to Dueñas, maystem from the country’s uniqueness withinCentral America.“Costa Ricans are highly educated,and our standards are high,” he said.“Fortunately, we don’t have a violent history,so Costa Ricans are quite satisfiedwith what they have.”That’s why many of its people arereluctant to embrace CAFTA, he suggested.After all, Costa Rica enjoys a per-capitaincome of about $4,500, by far the highestin Central America, and an unemploymentrate of only 4% – by far the region’slowest.It is also Washington’s leading tradepartner in the region, with exports to theUnited States coming to nearly $3 billion ayear – most of that in the form of agriculturalgoods like bananas, coffee and melons,as well as medical devices,microchips, shrimp, ornamental plants,flowers and handicrafts.“Costa Rica has a very diversifiedproduct mix,” he said. “We export almost3,500 different products to 125 countries.”CAFTA isn’t the only issue confrontingDueñas. The businessmanturned-diplomat is also continuing hismission to bring more U.S. investment toCosta Rica, particularly manufacturing.But the country is no longer a mecca forthe labor-intensive garment and apparelindustry.“In order to preserve our social structure,we cannot compete with low-wagecountries like Nicaragua, Honduras and ElSalvador. We are moving away from thatand going into highly technical, valueaddedproduction. Costa Rica wants toconcentrate on three areas of foreign directinvestment in which we feel we’re competitivewith the rest of the world,”Dueñas said, naming Ireland, Puerto Ricoand Singapore as some of Costa Rica’sstiffest rivals. “These three areas are hightechproducts like microchips, medicaldevices, and back-office operations likedata entry and call centers.”Dueñas must also contend with theissue of corruption, which struck CostaRica last year when allegations felled formerand current public officials such asex-President Miguel Angel Rodríguez(1998-2002), the man who named DueñasMinister of the Economy and Minister ofForeign Trade. Rodríguez resigned asSecretary General of the Organization ofAmerican States (OAS) last year becauseof the accusations against him and wasonly recently released from house arrestafter nearly a year in preventive detention(TT, Oct. 21).“CORRUPTION is present all overthe place, and finds its environment preciselywhere the institutional structure isweak,” Dueñas noted. “There’s a commondenominator, an umbilical cordbetween corruption and very weak rule oflaw. That’s why the political commitmentof strengthening the structure of ourcountries is going to help eradicate corruption.”Yet Dueñas doesn’t think last year’scorruption scandals, which put Costa Ricain the international spotlight, reflect negativelyon Costa Rica at all.“In general, other countries respectCosta Rica very much for the action thatwas taken, because it sends a very strongsignal that our judicial system is independentof the political and legislative branches– quite contrary to some other LatinAmerican countries where people areclearly above the law,” he said. “In CostaRica, no one is above the law.”

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