San José, Costa Rica, since 1956

Airports Gear Up for Season Despite Obstacles

Construction workers in the nation’s two biggest airports are rushing to put together long-awaited improvements in time for the one million tourists expected to fly into the two airports between now and April, high season for Costa Rica’s tourism industry.

The government also plans to send in extra Immigration and police officials to help reduce tourist-crammed lines in the airports and at the country’s borders.

At JuanSantamaríaInternationalAirport just outside of San José, airport administrator Alterra Partners is pushing workers to finish bathrooms and ceilings in time to open two long-overdue boarding areas by December.

The improvements, which were supposed to be completed two years ago, have been the casualties of a three-year-old financial debacle.

Head-butting between Alterra and the government has put the contract for the first two stages of a $290 million modernization project in a state of legal limbo, leaving the administrator to break open its piggy bank to fund what few improvements it can.

This season’s result – two carpetless, half-lit boarding areas Alterra promises to deliver by Dec. 8 – is a reminder that when it comes to opening up public works projects to private concessionaires, Costa Rica is still learning.

“In Costa Rica, it’s one of our idiosyncrasies that when there is some new project, it takes a big effort to put it into practice,” Alterra’s Corporate Affairs Director Monica Nagel told The Tico Times.

The plan to modernize the airport – Costa Rica’s first major attempt to contract out public infrastructure – has been a rock in the shoe for the Arias administration as it moves forward with previous administrations’ plans to privatize the nation’s sea ports, roads and other infrastructure.

Some 280 kilometers to the northwest, workers are building a new $1 million departure terminal for the DanielOduberInternationalAirport in Liberia, the capital of Guanacaste, according to Public Works and Transport Ministry (MOPT) spokesman Omar Segura.

Contracted workers started last month on the new terminal that will have a boarding area for 450 passengers, and is expected to help decongest the hub of the booming Guanacaste tourism industry. That airport project is being funded with a mix of private and government investment, Segura said.

Officials say the Liberia terminal should be done sometime early next year.

Privatization Predicament

The Juan Santamaría airport fiasco has become a public thorn in the side for the government’s plans to concession out public works to private companies. However, administration officials say the Alterra calamity is its own monster.

Viviana Martín, Vice-Minister of Public Works and Transport, said Costa Rica is “absolutely ready” to privatize construction and management of public works.

“Don’t confuse the problem with this specific contract with the idea that contracting (in general) has been a failure,” she told The Tico Times, saying further privatization of public works is an “ideal” plan.

“Costa Rica doesn’t have the money to provide for all its infrastructure needs,” added Martín, who is also president of the Technical Council of the Civil Aviation Authority (CETAC).

Martín said MOPT asked Alterra to do what it could to prepare Juan Santamaría for the tourism season.

The Juan Santamaría contract dispute saga began in 2003 as a disagreement over the amount Alterra is allowed to charge airlines and companies operating in the airport.

These fees are often passed on to the public through plane ticket prices. In March 2003, a scathing report by the Comptroller General’s Office raised questions about many of these fees (TT, March 28, 2003).

Alterra officials said the contract’s financial equilibrium was in jeopardy if the company was not allowed to charge the fees they said were previously agreed on with the government.

Construction was halted after international banks funding the airport’s renovation suspended the final $30 million of Alterra’s $120 million loan for the project’s first two phases until the dispute was resolved (TT, June 10, 2005).

The comptroller’s decision stood and the disputing parties have spent two years trying to find a new, fair route to financial equilibrium.

Alterra and its partners have put up more than $40 million to keep the longdelayed construction projects moving ahead, according to Nagel.

The Comptroller’s Office rejected an addendum to the contract in August, saying the addendum didn’t fix the airport’s financial imbalance (TT, Aug. 25). Banks and associates are now looking at extending the debt payment deadline as a possible solution to Alterra’s financial woes, according to Alfredo Aguileta, the company’s Financial Manager in Costa Rica.

Numbers Questioned

Public Security Vice-Minister Ana Durán said the government plans to send 25 additional immigration and police officials to Juan Santamaría to help the 33 officials who currently work at the 11 Immigration counters that process tourists there. She said there are no plans to send extra officials to Daniel Oduber in Liberia, however.

Customs officials were expected to meet late this week to discuss beefing up for high season, but at press time had not announced their plans.

The government also continued to work on $230,000 worth of improvements and repairs at eight rural airports throughout the country, according to MOPT.

As the government made a push to better facilitate more tourists coming into the country, the airports released discouraging tourism statistics.

From October 2005 to September 2006, 75,000 fewer tourists arrived to Costa Rica by plane than during the previous year, according to statistics the two airports keep.

The National Tourism Chamber (CANATUR) told the daily La Nación this decrease has cost the tourism sector $100 million.

CANATUR director Alberto López said poor roads and airports and passport theft are internal causes for fewer tourists coming here. Internationally, he said high gas prices and the World Cup in Germany earlier this year kept potential tourists away from Costa Rica.

However, the Costa Rican Tourism Institute (ICT) rebutted this claim the following day.

ICT officials argued in a statement prepared for The Tico Times that these numbers are “not official” and do not provide an accurate assessment of the state of Costa Rica’s tourism because they include only tourists entering via airports, not those entering by land or sea.

The statement offered statistics on the number of tourists who came to the country in June 2006. During that month, 0.5% fewer tourists entered Costa Rica through Juan Santamaría because of high gas prices forcing airlines to cancel flights.

However, the airport in Liberia saw 17% more visitors, and 930,680 visitors came to Costa Rica in June through all ports of entry, marking 3.8% growth over June 2005, the statement said.

Still, Tourism Minister Carlos Benavides “has seen the unofficial numbers” and is examining them, according to the statement.


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