Trust and confidence underpin Azerbaijan-Costa Rica relations

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By Elaine Holder

Azeri Observer editor

On his third visit to Azerbaijan late November, Manuel Antonio Gonzalez Sanz, the Costa Rican Minister of Foreign Affairs, spoke to Azeri Observer magazine about the new Costa Rican Embassy, future trade prospects, and the importance of building strong intergovernmental relationships.

Question: What is the purpose of your visit to Azerbaijan?

Answer: The main purpose of this visit is the official inauguration of our embassy. Mr Jairo Lopez is the charge d’affaires. He has been here already for some months, finding us a suitable location. This is a very important step forward for us because Costa Rica, being a small country, has a relatively small diplomatic presence around the world. We have, including the multilateral, only about 52 embassies. So, every time we make the decision to open one, it is with a lot of planning and with a strategic reason, because it has to be for the long term. I am very happy that Azerbaijan is going to reciprocate by opening an embassy in San José.

Q.: What do you hope to achieve from opening an embassy in Baku?

A.: We have established a very fluent and close relationship with Azerbaijan. We want to strengthen this relationship because we see Azerbaijan as a door to access other markets in the region. In the past when people back home have asked me “Why Azerbaijan? What do we have there?”, I have said, “Nothing.” At that time we had nothing, and that is precisely why we should have something. Azerbaijan is an economy in the process of transforming and diversifying. We did that some 30 years ago. As you know we have no natural resources, no minerals, no oil or gas, and we went through difficult times in the early eighties because of the international debt crisis and because at that time we were basically exporters of commodities – bananas, sugar, coffee and meat. Nowadays, because of the transformation we implemented, we are exporting more than 4,500 different products to 160 countries in the world. In terms of exports, I think we have a lot to offer Azerbaijan and we should be considered as a destination for Azeri investments as well.

Costa Rica has a very extensive network of free trade agreements covering more or less half of the world’s population. Most recently we have just finished negotiations of a free trade agreement with South Korea. We’ve had an important presence of multinationals doing business in Costa Rica for quite some time. We have a good free trade zone system that provides tax incentives for companies to come and either manufacture or provide services. Our economy has been growing steadily for the last few years at an average of 4%. We are a very stable country from a political, economic, and social point of view. We are one of longest democracies in Latin America. We abolished the armed forces 70 years ago, and we have used that money for human development, investing in health and education.

 

Q.: What do you see as the main areas of collaboration between Costa Rica and Azerbaijan?

A.: The typical answer would be trade and investment. I was foreign trade minister some 10 years ago. I think differently now compared to back then. In order for trade and investment to be successful among countries there has to be trust and confidence between the governments.  Governments pave the way, open the doors, and then the private sectors can take advantage of that. Yes, it may happen the other way around, just straight to business, but from my perspective if you want to be long term, it is good to have both good relations between the private sectors and good relations at an official level. That is what we have been building during these last three years – trust and confidence between our governments.

 

Q.: What is the trade relationship between Costa Rica and Azerbaijan like at the moment?

A.: It is very limited, non-existent, but if the will is there, it can happen. My presence here for the third time and the permanent presence we are going to have here from now on is a clear indication that will exists.

 

Q.: In what areas should investments be considered?

A.: We are still an agricultural-based economy in many aspects. Agriculture is very important for us, but manufacturing and services are also very important. Half of our exports come out of the free trade zone regime, so it means that manufacturing is growing. Foreign direct investment is also increasing. One factor that I like to highlight is that about 50% of the foreign direct investment that we’ve been receiving in the last 4 years is re-investments by the companies that are already located in Costa Rica. They have confidence in the future of our country, and they want to be there long term. We have a good IT infrastructure. We are the first producer of software in Latin America, not many people know about that. One of our main areas of export are high-end medical devices, heart valves, stents and very sophisticated equipment. We have created a cluster of about 80 multinational companies in that particular sector. Healthcare is another sector that is growing a lot, what we call medical tourism. A lot of people come to Costa Rica because we have very good clinics and doctors. They come for plastic surgery, for dental treatment and for orthopaedic surgery.

The protection of the environment and climate change is key for us. We are creating what we call a green hub. We want Costa Rica to be a sort of lab of good practices that can be shared with other countries in the fight against climate change. Central America is one of the most vulnerable areas in the world in terms of climate change, so renewable energy is something very important for us too. For the past three years we have been 99% renewable in terms of power generation and we hope to continue.

 

Q.: Do you have any plans to collaborate with Azerbaijan in this area?

A.: Absolutely! That’s a sector this country finds attractive, no doubt. Unfortunately, or fortunately – depends on how you see it – we do not have oil and gas that would be a natural aspect to partner with Azerbaijan. But like I said, this country is transforming their economy and in that part we can also help. I come from the private sector, so I am a great believer in the innovations and opportunities that can be created by the private sector. This is why it is so important now to open an embassy here and to have our people together. I have a lot of hope in regards to this relationship, and I have a lot of hope in our diplomat here. He’s a hard-working person. He has a lot of responsibilities to deliver. It’s going to be a very small embassy, so he has a lot of work to do, but having a permanent presence is important. We also recognise the hard work done by Azerbaijan and the former ambassador to Mexico who was concurrent to Costa Rica. He was very active in promoting his country. He, and of course the Minister of Foreign Affairs, were instrumental in developing this relationship.

 

Q.: Costa Rica is known for being a very peaceful country, which doesn’t have an army. Nevertheless, Costa Rica faces a variety of security threats that test the country’s security capacity. The country is in a dangerous neighborhood along a key drug-smuggling route, and it also has a long-standing border dispute with its northern neighbor Nicaragua. In your opinion, can a country survive without armed forces?

A.: We are a clear example that it is possible. Nowadays if you ask my children’s generation and even my generation, nobody would think about the possibility of having an army. It’s not within our DNA. If you put yourself in the context of Latin America 70 years ago, it was a very difficult and very bold decision. The pattern in Latin American at that time and for many years after, until recently, was dictatorship all over the place. Central America was not an exception. We had the Somoza family in Nicaragua to the north who didn’t like Costa Rica and tried to invade us several times. We had dictatorships and civil wars in El Salvador and Guatemala. In the 80s and 90s we had Noriega in the south in Panama. So it was very turbulent and not an easy neighbourhood. When the Sandinistas were back in Nicaragua, we had a litigation in the International Court of Justice in The Hague because they invaded a small portion of our territory. The court ruled in our favour, and they respected the ruling. So that’s the way we defend ourselves. It may sound a bit naïve, but it has worked out well for us. Of course, we have national security. We have police, and we have to improve not just the quality of our police officers, but also the equipment they have. Unfortunately, not only in Costa Rica, but also in the Central American region and in Mexico, we are deeply affected by drug trafficking – basically cocaine coming from Colombia. We are countries of transit, and we want to be effective in that fight. This is why we work very closely with the United States. We have a patrol agreement in the Pacific with the US. Costa Rica is ten times bigger in the Pacific than in the continental mass because of the Cocos Island. It expands our territory in the Pacific. It requires a lot of surveillance, not just for drug traffic, but also because of illegal fishing and preservation of our natural resources there. So we have a lot of challenges, but we are trying to address them in a positive way.

 

What is Costa Rica’s position on the Nagorno-Karabakh conflict?

A.: That is obviously a very sensitive issue. Because of our experience in terms of conflict with other countries, we aim for a peaceful solution. As matter of principle we hope for the peaceful resolution of any conflict. We already have enough conflicts in the world, and in that regard the international community has to help more and be more effective. I don’t think there is much that Costa Rica on its own can do. The UN has a very important role to play, and the countries who are facilitating the process as well. They have a responsibility to deliver, and that’s what we would like to see in this case and in all cases because of the multilateral aspect. If the international communities are effective in providing solutions and safeguarding those solutions, it works in our favour being so dependent on multilateralism and international law. We don’t feel any threat now. Even though we have a tense relationship with Nicaragua – we still have two cases in the International Court of Justice – our people-to-people relationship is good. We have a lot of Nicaraguans living in Costa Rica, about 12 to 13% of our population. The government-to-government relations are not as fluent. It’s probably the only country we have a tense relationship with, but this is something that repeats itself in many areas of the world. Countries have some sort of problems with their neighbours from time to time.

BIO

Degree in Law, Universidad de Costa Rica; Master’s in Law, Columbia University Law School. Formerly, Professor, Corporate Law and Securities, Universidad de Costa Rica. Ambassador of Costa Rica to UN and its specialized organizations in Geneva; 2003, Coordinator, Caribbean and Latin America Group; 2004, Vice-President, Human Rights Commission; 2004-06, Minister of Foreign Trade. Adviser to corporations and financial institutions on project finance, corporate finance, reorganizations, acquisitions, foreign investment and trade. Formerly, Board Member, International Bank of Costa.

 

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