LABOR MINISTER FRANCISCO MORALES

UNCLAS SAN JOSE 000971

SIPDIS

SIPDIS

DEPARTMENT FOR WHA/CEN JASON MACK

E.O. 12958: N/A
TAGS: PINR PINS PGOV CS
SUBJECT: LABOR MINISTER FRANCISCO MORALES



1. Summary: President Oscar Arias has named 65-year-old
Francisco Morales to be Minister of Labor in his
administration. Morales has a long history of government
service, having previously served as Minister of Labor from
1972 to 1977, and as Minister of Agriculture from 1982 to

1986. With his strong ties to organized labor, Morales
appears to be a concession pick by Arias, aimed at drawing
labor unions into a social dialog, and to soften their
resistance to the U.S.-Central America-Dominican Republic
Free Trade Agreement (CAFTA-DR). Morales has stated his
intention to strengthen and modernize the country's workforce
through education, and has already reached out to labor
leaders who have previously refused to meet with Arias. End
summary.


2. President Oscar Arias recently announced his choice of
Francisco Morales Hernandez as Minister of Labor in the new
administration, which took office May 8. A long-time leader
within the National Liberation Party (PLN),Morales has
served as minister in three previous administrations. After
being elected as a deputy to the Legislative Assembly in
1970, Morales cut short his legislative tenure to serve as
Minister of Labor for President Jose Figueres from 1972 to

1974. He continued his tenure as Labor Minister into the
next administration, that of President Daniel Oduber, where
he stayed until 1977. After his departure from the Oduber
administration, Morales began teaching labor law at National
University, but returned to government service from 1982 to
1986, as Minister of Agriculture for President Luis Alberto
Monge.


3. With a long history of government service and strong ties
to organized labor, Morales appears to be a concession pick
by Arias, calculated to draw labor leaders into a dialog with
the new administration and to ease implementation of the
U.S-Central America-Dominican Republic Free Trade Agreement
(CAFTA-DR). Despite their long-standing relationship with
Morales, however, labor leaders are approaching his
nomination cautiously. Gilbert Brown, Secretary General of
the Rerum Novarum union, told Poloff that Morales will only
be as effective as Arias allows him to be. Albino Vargas,
Secretary of the National Public and Private Employees

SIPDIS
Association (ANEP) and one of CAFTA-DR's most vocal critics,
in calling for a meeting with Morales, stated his belief that
Morales is "humble" enough to meet in a "neutral" location.
(This is a reference to the refusal of President Arias to
accede to Vargas's earlier demand to meet at a venue other
than the President's house.) In fact, Morales subsequently
met with Vargas to discuss the various concerns of labor
organizations.


4. In a recent interview, Morales stated that, while working
with labor leaders opposed to CAFTA-DR will be important,
these leaders must understand that in order to increase
salaries, grow the economy and improve education, health care
and quality of life, Costa Rica will need the foreign
investment that can only come with CAFTA-DR approval. When
asked about his specific plans to improve the work
environment in Costa Rica and to modernize the workforce,
Morales emphasized education. He stated that the country's
network of technical schools must change its admission
standards to allow students without a high school diploma to
receive occupational training. In addition, he hopes to
introduce a system wherein workers can get educational credit
for on-the-job training. In response to concerns that public
sector salary increases have failed to keep pace with
inflation, Morales said that workers will have to be patient
while the Arias administration attempts to right the economy.
He cited Arias's warning that his first year in office will
be one of governmental austerity, and indicated that workers
will necessarily be affected by the belt-tightening.


5. Born in 1940, Morales is married, with 3 children. He
received a bachelor's degree in political science from the
University of Chile, and a law degree from the University of
Costa Rica.
LANGDALE