For a long time, Costa Ricans have been wishing for the advanced infrastructure that could allow access to the farther sectors of our population, promote productivity and exports, attract foreign investment to create employment, grant the adequate conditions for better and sustainable utilization of urban spaces, and in consequence, reach a better quality of life for our citizens, which is the final goal of any country.
Reality makes us recognize that many of our problems and needs in Costa Rica are caused by the lack of infrastructure that allows the creation of opportunities for all and the elimination of obstacles that avoid us from reaching the solutions the country claims.
In this scenario, we have a National Plan for Development and Investments that creates the guiding framework for the government, lead by MIDEPLAN (Ministry of Planification) in coordination with the authorities of the National Planification System, which includes a series of projects that have been established and considered essential in order to achieve the proposed goals, yet have not been materialized due to the lack of effectiveness in decision making.
The State of the Nation Report for 2018 has revealed some relevant facts regarding transport and mobility. For example, a 50% of the workers in the Metropolitan Great Area has to move because they work at a different place from their residence whilst out of the MGA the percentage is of 18%; the economic costs derived from the traffic congestion represent approximately a 3,8% of the BIP; the negative impact of transport is estimated at an annual cost of 3.146 million dollars; Costa Rica is the third country regarding vehicle density, exceeded only by Argentina in the first and México in the second places; the transport sector is responsible of a 66% of fossil fuel consumption and a 54% of the carbon emissions in the country; bus (34%) and private vehicles (33%), are the principal means of transportation used to go to work; 90% of the High Capacity Network is considered in non-conformance according to the Transport National Plan with regards to the number of lanes; it has been estimated that the percentage of problematic routes will raise from 48% in 2017 to 86% in 2025 if nothing is done.
This data should generate a preoccupation and commitment to promote progress in all the sectors involved, from where each one is meant to act, and particularly, to generate and support the long term plans for development that should help us achieve the solutions to the aforementioned problems, which have been highlighted by the World Economic Forum Report in various occasions as the elements that jeopardize our competitiveness, and as challenges to improve by the OECD.
The same report from the State of the Nation indicates that if we were to complete the sectorization of the bus lines, we would save approximately 3.305 million colones, an increase of 61% in the velocity of trips, and a reduction of 506 tons of fuel emissions per year; besides, a fast train to transport passengers between Alajuela and Cartago would reduce the travel time from 80 to 42 minutes and the daily amount of persons transported would increase from 16.000 to 250.000.
It is clear that we are in an urgent need to promote the solutions to reach a positive impact over human development, and even if there are some projects that have been shyly assumed by various governments, these have not been completed due to the lack of long term commitment, the absence of a grand national vision and the lack of commitment beyond the 4-year presidential period. This problem, as well as the distrust that exists between the parties involved: government, private corporations, financial institutions and users, have made it difficult to actually solve and successfully attack the problems that were diagnosed a long time ago. Some examples of successful projects are the Ruta 27, Aeropuerto Daniel Oduber Quirós, Terminal de Contenedores de Moín, Terminal Granelera de Puntarenas, all of which have been assigned by concession and are currently operating.
We are capable of building the projects we need, but in order to accomplish that, we need to be open to options that are adequate for our reality, and understand that concessions, projects that come from private initiative, and Public – Private Partnerships are an important and a valuable alternative to develop the required infrastructure, given the financial situation and the incapability from the government’s side to develop these independently. We have the right human resources in the public sector to build high end infrastructure, it is all about working with those who put their private interests aside and take the national interests as their priority and their goal.
During the second half of the last century and until 1990, MOPT worked as a key figure for the Government regarding infrastructure development, it built important highway projects, new roads and expanded the ones that required expansion. The capital to build execute these projects came from taxes and international loans, and a smaller portion of said capital was obtained through tolls and the emission of government bonds, this put Costa Rica on the map as one of the most well-connected countries in the region. After 1990 a group of independent institutions were created and the outstanding ability of the MOPT to function properly was injured. These institutions depend on MOPT but work independently, amongst them are CONAVI, CTP, COSEVI.
Since 1994, with the General Law of Concession of Public Work and Services Concession, the law-making body tried to strengthen a new procedure that, despite of its legal existance, lacked of an appropriate structure and a specific legal framework. This, plus the country’s economic situation and the political decisions taken by different governments throughout history, made the appearance of new financial modalities, such as trusts, rates and tolls necessary, and have created the right environment to achieve political and social agreements with regards to the acceptance of the public concession figure as one of the most appropriate ways to solve the indicated problems. Admitting the fact that private funds and capital are needed to promote development is of vital importance. A recent reform to this law was approved by Congress, in order to make private financing a stronger factor in this equation, with the hopes of promoting public concessions as a successful way to develop the country, as well as granting all the parts involved legal certainty will be a vital tool to promote this type of initiaves.
Nowadays, the transport and infrastructure sector is composed by MOPT, 3 independent institutions: Instituto Costarricense de Ferrocarriles, Junta de Administración portuaria de la Vertiente del Atlántico, Instituto Costarricense de Puertos del Pacífico and 7 decentralized entities: Consejo de Seguridad Vial, Consejo de Transporte Público, Consejo Nacional de Vialidad, Consejo Nacional de Concesiones, Consejo Técnico de Aviación Civil, Consejo Portuario Nacional, Tribunal Administrativo de Transportes. (ref: Informe del Estado de la Nación 2018, figure 6.1 page 251.) Many of these have the same tasks and responsibilities regarding their specific objectives and scope of work, this makes it difficult for them to coordinate and share opinions in order to move forward with projects that concern national development and infrastructure. Apart from that, there are many laws that create confusion in this topic and make the procedures and regulations harder to understand. This has been pointed at as weakness by the World Economico Forum, and as an aspect that needs improvement from the OECD’s side, for that reason it is important to modify and simplify, if necessary, the existing laws and regulations. One of the key factors of success in this matter is a clear and adequate legal framework, the right application of laws is highly important and this depends on the involved workers.
There is a discussion around the new alternative mentioned in the legal project of the PPP Law under file number 20916, which has as it´s main objective to allow and regulate the alliances between public sector and private corportations, so that the society and the State together can jointly develop and promote projects that will benefit the country. This way, given the amount of social interests playing their part, projects of greater magnitude will be taken more serioursly and be executed using other financial options that can generate income from the operation of the project itself, different than the government’s capital. This way, the State will accomplish its mission and its purpose, without compromising its funds for other social investment that might be equally important and necessary. Another benefit of this modality is the investment opportunities that appear and the economic activation of private sector. This project contains valuable regulations regarding this type of alliances, but these regulations could well be captured in an additional chapter to the General Law for Concession of Public Work and Services, similar to the one of private initiative, included in this law, without the need to create a new institution such as the Technical Commission proposed to be created and integrated in a very similar way to the National Concession Counsel, with the diffence that the first one is governed by the Treasure Department while the latter is governed by the Ministry of Public Work and Transportation. This modification could make the National Concession Counsel a singular institution (National Public Work and Services Counsel) in charge of concessions, private initiative projects and the PPPs, turning the Concession Law into a Public Work and Services Law, and instead of creating new organisms and institutions that compete among them, improved and propell the existing ones, so that the funds that would be used for this new institution could be assigned to this “National Public Work and Services Counsel” to bring new highly qualified workers and train the ones they already have so they can study the projects properly, make decisions based on their knowledge, and execute those that comply with the National Plan for Development and are good for the country, either through concession, private initiative or public-private alliance. That budget assignment would help coordinate and interrelate all the institutions involved in authorizing and granting the necessary permits for the realization of the project, as well as those in charge of expropriations needed. It would be good to promote a similar organization to Procomer in the centralization and simplification of the paperwork and formalities regarding import and export adapted for this subject.
A more clear and uniform framework as well as the responsible action of trained workers willing to make this country a more developed one will be of the essence to improve and move forward.
To achieve progress, we must make good use of the resources in hand, building a scheme that correctly assigns each independent and decentralized institution its responsibilities and functions in order to grant the possibility of complying formalities and paperwork for projects that concern national interests, we must make sure that the institutions are working properly, following the legal procedure and working efficiently towards the realization of the project, so that the needed documents and requirements for any project will be easier and faster to get, in a more agile way.
Every sector in the country must join in strength and efforts to promote the programs that will allow us to move forward. It is clear that there is a need, it is clear that the government cannot face these investments by itself, but there are many entities and financial plans that can help the government and the country get to where we want to get. Many corporations have the ability to build important infrastructure projects, and well trained and consciuos personnel can make a big difference in making a better use of the resources for public works. The conditions are there and the circumstances need to change for good, we have no other choice.
The diversity of political parties that represent us in Congress, with congress people commited to making a better country and willing to boost projects that will reinforce our economy and strengthen the conditions to do business with private corportations and other countries must help us move forward; a government where people from different backgrounds join in to cooperate in developing the necessary strategies and projects, which is willing to take advice from very capable people no matter their political parties, a group of professionals working together in the private sector to support the right projects and initiatives, a General Comptroller´s Office that is aware of the importance of auditing the contracts but is also aware of the importance of opening their minds to new ways of concessions, and people who are aware of circumstances is a good sign that we can achieve a common purpose in this process of improving our infrastructure. We are at the ideal political, legal and financial circumstance to make the change towards progress.
It is time to understand and accept the reality, that we are against the wall because of the needs that are not being fulfilled, that we are way behind when it comes to infrastructure and for that reason the traditional belief that the government is the only responsible for solving our society’s demands needs to change. We need to open our minds to new possibilities where the private sector can also take care of what we have called “public needs,” this under a well prepared legal framework that will allow the private sector to grow but most importantly to satisfy the needs that are being left unsolved, in a legally stable and secure framework.
It is clear that the alliances between both sectos as well as the concessions need to be acknowledged as a valuable and important way to achieve projects that can bring back a sense of development and prosperity to our country. Institutions such as CINDE and Chambers, will play an important role in building strong relationships amongst all the actors in society so the interaction and information can be exchanged efficiently between all the parties involved aiming the objectives proposed.