MARCO VARGAS, MINISTER WITHOUT PORTFOLIO

UNCLAS SAN JOSE 001151

SIPDIS

SIPDIS

E.O. 12958: N/A
TAGS: PINR PGOV PREL CS
SUBJECT: MARCO VARGAS, MINISTER WITHOUT PORTFOLIO



1. Marco Antonio VARGAS Diaz will likely play a key role in
the Arias Administration. Vargas is part of Oscar Arias's
innermost circle of advisers. His stated role is to serve as
an inter-institutional coordinator and troubleshooter,
charged with ensuring delivery on Arias's campaign promises.
Vargas holds the only entirely new cabinet-level position
created by the Arias Administration (two positions were
eliminated and two others combined). He will work out of the
Casa Presidencial with a small staff from the Ministry of the
Presidency and will free the Minister of the Presidency to
serve as more of a Prime Minister, concentrating on
legislative liaison, than Chief of Staff.


2. Born August 17, 1948, Vargas married Matilde Lorena RUIZ
Baldioceda in 1970 and graduated from the University of Costa
Rica with a degree in Economics and Social Science in 1976.
Vargas, who has 35 years of experience in the industrial
private sector, began his career in the family printing
business (Imprenta y Litografia Vargas) where he currently
serves as president. Vargas founded his own packaging
company (Empaques y Envases Centroamericanos) in 1986 and
still serves as president and CEO. Also in 1986, Vargas
began a four-year stint as Vice President of a regional
fertilizer company (FERTICA). An active member of the
Kiwanis Club, Vargas was selected by the Economic and Social
Sciences Association as the 1993 Distinguished Private Sector
Professional.


3. Vargas began his political career in earnest in 1991,
coordinating a committee that explored Jose Maria
Figueres-Olsen's chances for being elected President of Costa
Rica. Vargas then served as Treasurer for the Figueres
Presidential Campaign. When Figueres was elected in 1994, he
named Vargas as Minister of Economy. In 1995, the Ministry
of Science and Technology was temporarily combined with the
Ministry of Economy, and Vargas held both Ministries until
1996 when he became Minister of the Presidency (similar to
Chief of Staff) for the remainder of the Figueres
Administration (1994-1998).


4. At the end of the Figures Administration, Vargas returned
to private business but remained close to Figures who
established the Costa Rican Foundation for Sustainable
Development. Vargas served as President of the Foundation
and also served as Figueres's representative and spokesman.
On October 27, 2004, Vargas publicly resigned both positions
in disgust over revelations that Figures had received up to
$900,000 in presumed kickbacks from French Telecom company
Alcatel. Around that time, Vargas, who shares a life-long
National Liberation Party affiliation with Oscar Arias,
became actively involved in the Arias campaign.


5. PLN insiders and other observers expressed initial
surprise that Vargas was given an apparently low-profile
position in the Arias Cabinet. However, recent signs
indicate that although Vargas's role is behind the scenes, he
will be a key adviser. Recently the head of the
semi-autonomous Water Administration presented his
recommendations for legislative reforms to Vargas instead of
directly to the Legislative Assembly as has been past
practice. This is a major change since it implies that even
the heads of major telecommunications and insurance entities,
who will play a crucial role in the debate over the Free
Trade Agreement, will be coordinating their legislative
proposals through Vargas's office.
LANGDALE