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Costa Rica: Corruption and clientilism

Thursday, April 19, 2012

WHAT The resignation in disgrace earlier this month by the Finance Minister, as well as of the Director of Taxation, in both cases for failing to pay taxes, is only part of the country´s problem. Meanwhile, other public officlals, including some at the highest levels of government, helped ensure that friends and relatives received lucrative state contracts.

WHY Corruption and clientilism almost certainly have existed in previous administrations, in a country in which a privileged public sector has over the years become increasingly unaccountable. During the past five years, salaries in the state sector grew by 210%, while economic growth was barely a quarter that amount; meanwhile, luxury pensions for retired bureaucrats cost $1.2 billion a year, of which the pensioners contribute only 10%, leaving taxpayers to subsidize the rest.

WHAT NEXT The problem for Costa Rica is that, at least in the short term, there may not be any next. In advance of national elections, scheduled for 2014, many Costa Ricans will be looking for a candidate, who is fresh, competent, and not linked to tarnished a political system. So far, no one has showed up, who meets the criteria.

For more information, please contact Esteban Alvarez, at [email protected]