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Corruption Allegations Link Salvadoran Ex 9 December 2016 Volume 4, Issue 22 Click the headlines for full stories. Corruption allegations link Salvadoran ex-President to Odebrecht Brazilian firm Odebrecht, currently on trial for fraud in Brazil, has alleged that part of the money illegally siphoned away from the business was used to fund former President Mauricio Funes’ presidential campaign, according to reports in Brazilian newspaper Folha do São Paolo. Funes’ Brazilian-born wife, Vanda Pignato, is alleged to have acted as an intermediary between Odebrecht and the Brazilian Worker’s Party (PT) in order to access 3.5m reales (US$1.5m) whilst her husband was running for President in 2009. The allegations are denied by the current President of El Salvador, Salvador Sánchez Cerén, who described the claims as “absolutely untrue.” The newspaper nonetheless claimed that sources close to the investigation informed them that the allegations against Funes emerged during Odebrecht’s trial, as part of a plea bargain secured by individuals involved including Marcelo Odebrecht, the head of the company. President Morales: Guatemalan institutions are ready to tackle crime and corruption President Jimmy Morales has stated that Guatemala must prepare itself to take independent responsibility for defeating corruption and organised crime. For nine years the country has been working with the International Commission against Impunity (CICIG), an organisation created by the UN in 2007 to support and supervise the investigation and prosecution of serious crime in Guatemala. Speaking during a visit to Israel, Morales argued that the objective of the CICIG had always been to strengthen the national judiciary in order to ensure that it was able to confront organised crime and gang-related violence independently in future. During the same press conference, the President declined to comment on the ongoing investigation into fraud allegations against his son and brother. Costa Rica and Nicaragua take stock of damages after Hurricane Otto Costa Rica and Nicaragua are working to repair damages caused by Hurricane Otto after it struck both countries between November 25-26. The first recorded hurricane to hit Costa Rica left nine people dead and caused significant damage to the northern Upala and Los Chiles regions. President Luis Guillermo Solís told a press conference that Otto had destroyed roads and damaged homes and electricity supplies. Initial estimates suggested that the total costs of damage to the national road network would amount to some US$8.7m. The hurricane had weakened by the time it reached Nicaragua, where no one was reported dead, although houses were destroyed and some damage to infrastructure was sustained. Mexican airline Volaris to offer new low-cost flights Low-cost airline Volaris has launched a twice-daily flight between Guatemala and Costa Rica as part of its plans to extend its Central American operations. The development by the Mexican airline was described by General Manager for Costa Rica Fernando Naranjo as “a significant step forward for the aviation industry in Central America”. Volaris now hopes to expand further throughout the region, adding new, low-cost routes to improve connectivity. Costa Rican Tourism Minister Mauricio Ventura described the development as a “fantastic opportunity to promote multidestination and intraregional travel.” OAS Secretary General meets with opposition and business figures in Nicaragua The Secretary General of the Organisation of American States (OAS), Luis Almagro, met last week with opposition politicians, as well as representatives from the business sector and civil society, to follow up on the OAS’ earlier observation of the election process in Nicaragua. Shortly before presidential elections took place on November 6, President Daniel Ortega conceded that he would allow electoral observers to supervise the vote, despite having consistently resisted their presence. Those who met with Mr Almagro included José Adán Aguerri, President of the main organisation of private businesses in Nicaragua (COSEP), as well as representatives from SMEs and national development association FUNIDES. Although Mr Almagro took to Twitter to describe the meetings as ‘fruitful’, the visit took place against a backdrop of protests in the capita, Managua. Demonstrators marched through the city to demand changes to the country’s electoral system, concluding their protest outside the main Electoral Council buildings. New figures cast doubt on increased income from Panama Canal Newly released data compiled by Panama’s National Institute of Statistics and Census (INEC) points to a reduction in total income generated by the canal between January and September 2016. The INEC suggested that revenue from tolls in the canal amounted to US$1.43bn during this period, a reduction of 3.7% on last year’s figures, whilst the total merchandise transported via the canal decreased by 3.3%. The figures contradict those already released by the Canal Authority (ACP), which suggested that the canal had registered the third highest annual tonnage of its history in fiscal year 2016 (October 2015-September 2016). The ACP stated that 13,114 ships had passed through the canal during this time, a figure which ACP administrator Jorge Luis Quijano described as an illustration of the continued strategic value of the Panama Canal. Costa Rica to receive compensation from Nicaragua President Daniel Ortega has announced that Nicaragua will pay compensation for environmental damages caused on the Costa Rican territory of Isla Portillo. The Nicaraguan President had previously described Costa Rica’s claims as “exaggerated” and “disproportionate”, but appeared to reverse his position this week, stating that he would comply with a ruling from the International Court of Justice in The Hague requiring compensation to be provided. Nicaraguan officials claimed that negotiations over the total amount to be paid were still ongoing, although Costa Rica has stated that the figure amounts to US$6m. Ortega underlined the importance of upholding good diplomatic relations with Costa Rica, highlighting the close commercial and security links between the two. Integration of Corinto border crossing (Guatemala/Honduras) Guatemalan and Honduran customs procedures at the Corinto border crossing have been fully integrated. Guatemala’s Economic Ministry stressed that the Corinto development was especially significant as it will enable cargo to be transported more directly between Puerto Santo Tomás and Puerto Cortés. Full joint responsibility for customs procedures along the Guatemala-Honduras border is now expected to be completed in July 2017. Eleven injured in clashes over Nicaragua Canal project Eleven people were injured in the Nueva Guinea municipality of Nicaragua as protestors against the planned construction of an inter-oceanic canal clashed with police. Larger-scale protests had been due to take place on Wednesday 30 November in the Nicaraguan capital of Managua, but were cancelled after violence broke out the day before. The proposed canal, which will measure 174 miles (280 km), has encountered opposition amongst citizens (including indigenous peoples) who will be affected, as well as amongst environmental groups. A statement from the Nicaraguan police, however, described those injured as “vandals” who had used sticks and machetes to attack officials. Regulatory environment in Costa Rica evaluated by OECD The OECD has published a report evaluating several aspects of the Costa Rican financial system. The analysis focused on key areas including transparency; alignment with international financial regulations; and the protection of intellectual property rights. The report praised Costa Rica’s successful export-led development over the past 30 years, whilst also pointing to priority areas for improvement. These included the need for increased funding for Research and Development; the development of human capital and a more skilled workforce; and the need to intervene to ensure that Costa Rica progresses in Global Value Chains. It also highlighted inadequate infrastructure and logistics system as a key obstacle to expanding trade and securing greater international investment. Top upcoming projects Costa Rica: Tender for Vehicles: US$5million The Government of Costa Rica is putting out a tender for the purchase of Sedan, Pick Up, Minibus and ‘Rural’ vehicles, with a total value of US$5 million. Bids must be received by December 23, 2016. Panama: Tender for Road Repairs: US$10 million The Ministry of Public Works in Panama has put out a tender for road repair work including the dredging of rivers and the construction of embankments, bracing, and retaining walls. The next issue of Central America Briefing will be sent on 9 January 2017. We wish all of our subscribers a happy Christmas and new year in the meantime. Copyright 2016© Central American Briefing is produced for CABC Members by CentralAmericaData on behalf of the Publications Division of The Caribbean Council, Temple Chambers, 3-7 Temple Avenue, London EC4Y 0HP United Kingdom. No legal responsibility is accepted for any errors or omissions. For more information about the Central American Business Council and membership, contact: Emily Soar Email: [email protected] Tel: +44 (0)20 7583 8739 Web: www.centralamericanbusinesscouncil.org .
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