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COSTA RICAN RECENT ECONOMIC DEVELOPMENT: ROLE OF THE US

COSTA RICAN RECENT ECONOMIC DEVELOPMENT: ROLE OF THE US. ND Kellogg Institute , Feb. 7 th , 2011 Otton Solis. WHERE?.

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COSTA RICAN RECENT ECONOMIC DEVELOPMENT: ROLE OF THE US

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  1. COSTA RICAN RECENT ECONOMIC DEVELOPMENT: ROLE OF THE US ND Kellogg Institute, Feb. 7th, 2011 OttonSolis

  2. WHERE? http://maps.google.com/maps?hl=en&sugexp=egsisas&xhr=t&q=map+of+costa+rica&cp=11&um=1&ie=UTF-8&hq=&hnear=Costa+Rica&gl=us&ei=WyNQTZfbNoP88AanxbiyDg&sa=X&oi=geocode_result&ct=image&resnum=1&sqi=2&ved=0CBcQ8gEwAA

  3. CR-US: Econ, Social, Environmental Facts CRUSIndiana Area (sq Kms) 50,900 9,826,630 93,720 Population (millions) 4.5 307 6.5 GDP ($ billions) 35 14,600 240 GDP/Person ($) 7,800 47,500 36,900 Agriculture/GDP 11 % 0.7 % R&D/GDP 0.4 % 2,5 % Productivity 17,500 65,500 Public Debt/GDP 40 % 60 % Illiteracy 3.9 % 3.9 % Life Expectancy 79.1 79.3 Infant Mortality (per thsnd) 11 8 Gini Coefficient 46.6 40.8 Unemployment 9 % 7 % Congresswomen 38.6 % 19.9 % 20 % Carbon Emissions/Person (tons) 1.8 19 Savings/GDP 9.1 % 0.9 %

  4. CR-US: History, Institutionality CRUS Colonial Power Spain GB, Spn, Frnc, Hllnd Independence Peace War Indepdce Year 1821 1774 Democracy 1889 1774 Const. Organiz. Republic Fed. Republic Congress Unicameral Bicameral Civil Wars 2 2 (Indian, South) Intern. Wars: 1 17 -on its territory 1 2 -overseas 0 15 (?) Arm Forces Weakest Mightiest

  5. Direct Programs • Alliance for Progress, 1963 -social development, education, land reform, rural investment -planning • Caribbean Basin Initiative (CBI), 1983 -unilateral trade concessions • Economic Recovery Assistance, AID 1982-1990 -grants, concessional lending • PL480 -Free beans and wheat • Free Trade Agreement CAFTA, 2002 -trade and investment rules • Various programs related to drug trafficking, crime, etc

  6. Indirect Programs • International Monetary Fund (IMF): Stand By Agreements • World Bank (IBRD): Structural Adjustment Programs (SAPs) • Inter American Development Bank (IDB): Lending • Paris Club: Bilateral Debt Rescheduling • World Trade Organization: multilateral trade and investment rules

  7. The Motivations • Geopolitics -countering communism: Alliance for Progress, CBI • Economic Interests –strengthening advantages of MNCs, exports, stability world financial system: Stand By Agreements, SAPs, FTAs. Paris Club debt reschduling, IDB lending • Ideology –market economics: CBI, Stand By Agreements, SAPs, FTAs. Paris Club debt reschduling, IDB lending • Generosity: ???

  8. The Results CR Positive: i) Alliance for Progress: national planning, social development ii) IMF, IBRD: fiscal and monetary discipline, rule of law iii) CBI: exports’ increase and diversification. CR Negative: slow GDP growth, impoverishment of small farming, inequality, less social mobility (impact in middle class), undermined democracy, deepened corruption US Positive: exports, profits, ownership, control agenda US Negative: short run, wrong alliances, image

  9. Reconciling Objectives • The case of Alliance for Progress: fighting communism with social development • The case of CBI: promoting democracy through export growth and diversification

  10. Road Ahead • Look at Long run interests • Strengthen democracy • Promote social development • Be clear-cut anticorruption • Recognize civil society other that top corporate chambers • Work for interests of US people which ≠ its MNCs interests • Forget about trickle down • US not US: by far, main cause of underdevelopment is us Costa Ricans but the US has not been an oblivious passer by

  11. Playing the World Power game AND make more than a few friends • Social Development (vs. trickle down) : education, health, small business • Sustainability • Anti-corruption, transparency, ethics • R&D From feared to respected …. and even admired

  12. ¡Gracias!

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