A message from the president encouraging foriegn investment

Friday, May 19, 2006

Arias Announces Incentives to Tourism Investors

President Outlines Plans To Shake Up Ministry of Tourism

Without faster growth in tourism, Costa Rica risked losing 300,000 new jobs, President Óscar Arias told the country’s biggest industry gathering this week.

“Our priority must be to channel all our efforts to transform the ICT (Instituto Costarricense de Turismo) into a dynamic institution, aware of its mission as the industry’s voice, and transforming itself into the regulating entity in all that affects the tourism sector,” the President told about 300 professionals at the official opening of the industry trade show, Expotur.

And in further evidence the Arias regime will concentrate on what is effectively the country’s biggest export earner, the President promised tax incentives to foreigners willing to invest in tourism.

“We must introduce tax incentives, but with control,” he told the audience. “We cannot afford not to have a policy of foreign investment incentives. When our competitors are improving daily so that visitors come, it is because they have simplified the process.

“Meanwhile, our investors are subjected to endless nightmares...even just to build a marina,” Dr Arias said. “There have to be changes.

“The private sector must be integrated in the planning and execution of programs that look to fulfill tourism needs,” he added.

The President also made clear that he aims to jealously guard the country’s image abroad as a haven for nature that has no army and no history of war.

“Love of peace, love of nature: that is to be our country brand,” he told the audience.

That support for tourism and the high priority he clearly gives it has been received enthusiastically.

“There have been commitments made to solve various bottlenecks in the industry, like infrastructure, security, a reduction in bureaucracy and the most important, incentives for investment,” said Carlos Lizama, Vice President of ACOPROT, the Asociación Costarricense de Profesionales en Turismo.

Mr Lizama said there were incentives in place but they had been suspended for years.

“There was a very restrictive interpretation of the legislation for incentives because there were some abuses, so the reduction has been gradual, probably starting some ten years ago,

” Mr Lizama said.
“This announcement is very important.”

More than 270 Costa Rican companies, and a number from both Nicaragua and Panama, exhibited during the week of Expotur, which began 22 years ago. About 140 buyers, mostly from the US, registered for the fair.

Dr Arias said up to 300,000 new jobs had to be created, but without what he called “elevated growth” in the industry that would not happen.

He called for more hotel rooms, a more professional police force and more English to be taught to job seekers. He questioned the failing cruise ship market in the country and warned protection of the environment was a priority.

“Costa Rica has positioned itself as a tourism destination of exceptional beauty, but although the number of hotel rooms is almost double that of other Central American countries, we have come up short,” he said.

“We must work on making our police force more professional and on the possibility of creating a corps with greater training in tourism.

“The protection of our environment is a priority abroad. Sustainability has to be the basis for any policy on development,” he added. That is still our priority; we will watch over our national parks and our protected areas.”

But while the President’s new Minister of Tourism, Carlos Ricardo Benavides lauded the country’s conservation efforts, he was also scathing with those who would willfully impair development.

“Our country stands out because of its conservation efforts,
but there is a streak of egoism amongst some people who call themselves environmentalists. It is a sophisticated strategy against the investor. They use blackmail to push forth their agenda.

“We must protect our national resources without allowing abuses against our investors,” he said, calling for an end to the red-tape he said hindered investors and developers.

For the second time in as many weeks and with the clear support of his president, Mr Benavides said his ministry would be at the forefront of government decision-making, adding it would be actively involved in denouncing those issues that threatened tourism, such as bad roads, poor infrastructure at the country’s airports and petty theft and violence.

“It’s impossible to appreciate the natural beauty when the roads are filled with traps,” he said. “It is impossible to grow when the airport infrastructure is years behind, and it is impossible for cruise ships to come to our coasts when the last (labor) strike hinders the few hours the visitors are here.”

And he warned the government would not tolerate the sexual exploitation of children, which he branded “a dirty and repugnant business”.

“The ICT will not stand quiet or still, we must continue with our campaigns against the sexual exploitation of minors,” he said. “The ICT must act so that other ministries fight against that scourge.”